Mergers spawn expanded supply network for input dealers

A wholesale buying network set up by and for independent Prairie crop input retailers, against a rising tide of industry consolidation, is now growing through consolidation.

The Prairie retailers, who in 2010 set up Grow Community of Independents to collectively build up their retail and agronomic offerings, are now independent members of a new entity, dubbed WinField United Canada.

Launched Monday in Saskatoon, WinField United Canada will be the Canadian arm of WinField United, formed last year through a merger of WinField, the crop inputs business of Minnesota ag co-operative Land O’Lakes, with Iowa-based crop input firm United Suppliers.

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The Grow Community’s dealerships in 2015 linked up with United Suppliers to form what was subsequently known as United Suppliers Canada, which has now adopted the WinField United Canada name.

The new organization will supply its member/owner retailers with seed, crop protection products and fertilizers along with “market-leading technology tools and customized business and agronomic advice at a local level.”

“Our goal is to support our retail owners in providing their farm customers with customized crop solutions that help promote efficiency and greater return on investment in every single facet of modern farming,” Greg McDonald, the former manager of the Grow Community and now general manager for WinField United Canada, said in a release.

WinField United Canada also plans to launch an owner advisory board, “so we can present opportunities and connect what Land O’Lakes has to offer,” McDonald said in a Land O’Lakes newsletter. “They can help decide what initiatives they believe will be a fit for their businesses.”

WinField United Canada, he said, now partners with about 60 independent retail companies, which between them have “north of 150” outlets.

The new Canadian organization will also now manage WinField United’s existing business in Eastern Canada, where it already markets seed to growers under the Croplan brand and offers “other proprietary products.”

For its part, Land O’Lakes said this arrangement gives the U.S. co-operative access to the Prairies, which it described as “the country’s largest crop production market.”

The WinField United Canada team’s member retailers together have about six per cent of Prairie ag input retail market share and 16 per cent of the total independent (that is, non-chain) market, Land O’Lakes noted.

McDonald, in an interview, said the independents show a “resilience” through waves of acquisitions, in which even some of the company’s own member retailers have been snapped up by line companies or larger chains.

In areas where one retailer is bought out, he said, an independent often starts up or an existing independent expands its catchment into that region. Farmers, who are generally independent businessmen themselves, and independent retailers “really resonate” with each other.

The WinField United model, he said, is more of a “from the ground up” approach, in which the organization takes its cues from its member retailers, as opposed to a “top-down” model in which a retailer follows a parent firm’s policies.

It’s important that its member retailers retain the power to make their own business decisions, he said, and “there’s no official alignment where they’re forced to do anything.

“If they need to bring on some product that best fits southern Saskatchewan, or southern Alberta, or the Red River Valley,” they can do so, whether it comes through the WinField United supply chain or not.

Asked whether member retailers are concerned about future consolidation — for example, the planned merger of PotashCorp with Agrium, owner of the Crop Production Services chain — McDonald said he believes independents will continue to be successful, as they “continue to deliver… and because of that, they will continue to be attractive businesses (for other companies) to buy.”

Speaking in WinField’s release, Brent Manning of GJ Chemical at Arnaud, Man., said his company “look(s) forward to working together” with WinField “to raise the bar in providing our customers with leading-edge service, emerging science and proven technology.” — AGCanada.com Network

 

About the author

Editor, Daily News

Dave Bedard

Editor of Daily News for the Glacier FarmMedia Network. A Saskatchewan transplant in Winnipeg.

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