Better buying

Better buying

Wayne Wenzel

Team FIN members share buying tactics. For the fifth year in a row, we asked Team FIN members to share their favorite buying strategies of the past season. Some members explored the Internet, while others found their favorite values closer to home. No matter how they did it, these discerning shoppers showed us that there’s more than one way to skin a greenback when buying for the farm.

Dealer deal Since the summer of 1999, Scott McPheeters has been suffering through some of the driest and hottest years in Nebraska’s history. This spring, a tornado (3 mph short of an F4) blasted flat 80 acres of his corn. He hauled a truckload of debris from the ruined acreage and replanted. Irrigation got his crops growing lush. Then he watched his fields get pulverized in a matter of minutes by a hailstorm 30 miles wide and 300 miles long – one of the worst in Midwest history.

Even after losing about $200,000 in crops in his battle with nature, McPheeters is still upbeat and is buying inputs and supplies for next year.

Recently, the Gothenburg, NE, farmer signed up with a farm supply wholesaler after his Case-IH dealership folded this year (as did the local New Holland dealership).

“As much as we need dealers here in central Nebraska, I always hesitated to do this before; I didn’t want my local dealer to go out of business,” he says.

To sign up with the supply wholesaler, he paid a one-time down payment of $3,500. So far, he’s purchased a water pressure tank and some grain-handling equipment. “I just call the wholesaler with my request. If I want a brand name or a certain model, and they contract with that business, I’ll get that. Otherwise, they’ll research other products and make suggestions,” he says.

All the equipment or parts the wholesaler offers show discounts of 20 to 40%. “During off-season maintenance, when I can wait for delivery, it’s worth the savings I’ll incur on parts,” McPheeters says. Shipping costs depend on the company that is supplying the part; sometimes there is no added cost.

“Anything I can get from this wholesaler, I will, if it doesn’t require warranty and if it’s not time sensitive,” he says. Because he had to sign up as a farmer/dealer, he also can encourage his neighbors to buy through him; but he doesn’t have to resell anything. “The more you buy, the faster you recoup the down payment,” he explains.

“There’s lots of terrible stories around about sending money to a company like this and then have them go bankrupt,” he says. “But, I’ve lost more money than this before I had my breakfast – on numerous occasions.”

Cheaper seed, better placement The Appleby brothers, Jack and Gary, of Atwood, IL, saw a need to buy and plant seed more accurately.

“We buy seed from about five different companies,” Jack says. “When we got done with harvest this year, we compared yields and found some of the less-expensive seed from our local, small seed companies yielded just as good as the seed from the `billion-dollar’ companies.”

Jack says they can save an easy $5,000 just from buying from another company – without sacrificing yield.

“I guess it’s kind of a misconception that bigger companies have the better seed,” he adds. “With this extra money, we can make another planter payment.”

The Applebys also have been scrutinizing their machines. They bought a used Kinze 2600-series corn planter with an interplant system to plant beans. They’d been using a 20-ft. no-till drill on most of their beans and also had two planters to plant corn and some of the beans in 30-in. rows.

“We’ll have just one planter for both corn and beans,” Jack says. “I think we’ll get better seeding control. With the drill, seed just kind of dribbled out and we didn’t have the control we wanted.” He figures they’ll save a couple thousand dollars a year just in seed bean control. “And I’m usually conservative in my numbers.”

Get with the program If you’re thinking of taking out a loan to buy new equipment, you might want to check with your state soil conservation service about possible reduced interest rate programs for conservation-oriented equipment. That’s what Pandora, OH, row crop farmer Daryl Bridenbaugh plans to do in the coming months as he looks to replace his old skid-steer loader and chisel plow. “The Ohio program gives you a 5%discount on any loan taken out for manure handling or soil conservation-oriented equipment,” Bridenbaugh says. “It’s a nice bonus if you are planning to buy the equipment anyway.”

Though Bridenbaugh prides himself in making his old equipment last as long as possible, he admits that sometimes an upgrade can pay off with fewer repair bills and better efficiency. “My fuel bill went down and my engine repair bills went to zero when I bought my Cummins-powered Dodge truck a few years ago,” he says.

Surfing for dollars Charles Myers had been prowling the tractor lots near his Lyons, NE, farm for several months, but he still hadn’t found the tractor he wanted ae a 1990 John Deere 4955 with low hours. “I found the model I wanted, but it had high hours and wasn’t in the greatest condition,” Myers says. “Finally I got on the Internet and found what I wanted on John Deere’s” The Web site led Myers to the Hogan Walker dealership in Dwight, IL, where there was a JD 4955 with low hours. “It was exactly what I wanted, had complete dealer service records and was $8,000 less than the high-hours tractor I had been looking at locally,” Myers says. He figures the savings were well worth a day’s drive and $900 in freight to get the tractor home.

A dollar saved Saving money is second nature to Bob Wietharn. Although none of his buying tactics is particularly new, the Clay Center, KS, hog and grain producer gets maximum mileage out of all the old ones. Wietharn’s motto is “Buy early, with cash, in quantity, where the deals are.” He purchases all his fertilizer, seed and chemicals out of season in the fall. He buys machinery parts that he knows he’s likely to need on a stock order over the winter months. And he buys fertilizer and other large-volume product by the truckload.

“It doesn’t bother me to not buy locally,” Wietharn says. “With today’s tight margins, you have to save every dollar possible. And I’ll buy direct from the manufacturer as much as possible. There seems to be too many middlemen these days.” Wietharn has his eye on the Internet for good deals, too, but so far he hasn’t found a cyber price he’s liked.

Go for service When buying herbicides, Steve Webb says he’s leaning more toward service and less toward product performance.

“If I know the dealer will take care of me on performance issues, I may be inclined to go with a product that isn’t necessarily the best performer,” the Needham, IN, farmer says. “I’m not buying product, I’m buying weed control. I think service is worth paying for.”

Trust in community As an oilseed grower and board member on his local cooperative, Tom Henry of Westhope, ND, places a premium on the value of supporting the local community. And he says that support usually comes back to him in service and product returnability. “What we plant and when we plant depends a lot on the weather, so we’re not always sure how much of any particular input we’ll need. It’s crucial that we have someone local who can take back or exchange seed at a moment’s notice. I’d rather pay 5 to 10% more than use a supplier 60 miles away who won’t take my returns.”

Henry feels the same way about purchasing farm inputs over the Internet. “I’m not technology phobic by any means,” he says. “If I need something that’s not available locally, like computer equipment, I have no qualms about online buying. But if what I need is available locally, I’d prefer to buy from someone I know.”

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