Dealer succession planning is a regular topic in the pages of Farm Equipment; in fact we devoted an entire special report and conference to the topic a few years ago. Progressive dealerships have a plan in place or are working on their plan to prepare the next generation of managers and leaders to move the business forward. But, what are you as the dealer doing to prepare your business for the next generation of customers? Anything?
Statistics Canada’s 2016 Census of Agriculture was released last week, and it showed some notable changes the make up of Canada’s producers — your customers. The census counted 271,935 farm operators — people who make management decisions. That's down from 293, 925 in the previous census in 2011. Of those, while people 55 and older still make up the fastest-growing segments of farmers, StatsCan found operators under 35 years old accounted for an increasing share of total operators, according to the Alberta Farm Express. In this latest census, 24,850 farm operators were 35 years of age or younger, up from 24,120 in 2011 and the first absolute increase in that age bracket since 1991.
The Canadian census also showed the number of women operators is growing as well. Women make up 28.7% of farm operators in the latest census, up from 27.4 in 2011. Of farm operators aged 35-54 years, women made up 30.7%, followed by age 55-plus (27.7%) and under 35 (26.4%).
The Alberta Farm Express article on the census results got me thinking about what, if anything, dealers might be doing to prepare for the changing look of their customer base. I reached out to several dealers and asked, “Do you actively get to know the sons and daughters of your customers, assuming they're involved in the farm operation? If so, what is it you do?” Beyond the typical involvement with 4-H, FFA and high school and post-secondary education, it seems like the answer is “not much.”
“Our sales team informally tries to integrate them into the equipment and farming discussions as they are allowed by the parents to do so. We have not implemented any formal structure around it,” says Clint Schnoor, president of Agri-Service.
Leo Johnson, partner of Johnson Equipment, says: “Even though we support the local 4-Hs, FFAs and local fairs, we don’t do a very good job at getting to know our customer’s kids. Many times, our customers’ kids don’t become decision makers until their 30s, 40s and even some in their 50s when dad finally turns over control. They probably are decision influencers all this time however.”
Agri-Service has been taking some steps to grow its business with women farm operators, though. “We have noticed females being more involved and operating farms and dairies in our region. This is exciting and they do a great job,” Schnoor says. “A few of our female executive team members have attended Women in Agriculture meetings to help support and grow our business in this area.”
It would seem to your benefit to try and build a relationship with that younger generation, but that is likely easier said than done and all depends on their involvement with any decision-making and the older generations willingness to let them in on those decisions. But, Johnson brings ups a good counterpoint — the numbers could likely be down again in the next census. “I believe the high farm profitability in 2011-14 drove many younger people into getting/staying in agriculture. Likewise, I believe that 2016-17 and however long this farm recession lingers on will also drive the youth numbers down in the next census.”
So what do you do? Put the effort in to build relationships with the younger generation before they are the decision makers, or wait and see if they ever become the decision makers? To me, it seems like you’re in a perfect position to help influence them to stay with ag.