Titel-Trader 1.2011.indd - Agritechnica Trader

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COMPANIES AND MARKETS CLIMMAR 18 TRADER | 1 | 2011 Service is decisive factor for the sale of new machinery The European farm machinery dealers association, CLIMMAR, concluded yet another successful Congress in Krakow at the end of last year. Members of CLIM- MAR since 2006, Poland played host to the 2010 Congress in the capital Warsaw. Gracing the event was the Polish Minister of Agriculture himself, Marek Sawicki, who delivered an insightful presentation based on current and forecast data of Polish agriculture. This was followed by an open and engaging question-and-answer session from participants, which centred mainly on the latest developments of the Common Agricultural Policy in Poland and Europe. Prior to the presentation, the Congress had opened with the 2.3 2.1 1.9 1.7 1.5 1.3 1.1 0.9 0.7 European Association of Agricultural Machinery Dealers has members in some 17 countries – 2010 Congress was held in Krakow Coarse grains 0.5 1996 2000 2004 2008 2012 2017 chairmen’s traditional address, which openly expressed views from CLIMMAR’s 17 member countries. Common among these views was the consensus among members that the pace of change in Europe and the world necessitated an even stronger and more active CLIMMAR. CLIMMAR members felt that the main objective of such a European organisation was to develop the exchange of information between various member countries, either among organisations themselves or between companies and individuals. This would ensure more effective communication through the sharing of ideas and initiatives among countries. With the current volatility in global markets, a stronger and more united CLIMMAR would be a great boost to its members. Agricultural risks Prices of wheat have recently undergone wild fl uctuations due to a disastrous drought in Russia. A decision to halt grain exports and maintain food security in the country World price developments for crop and animal products up to 2017 Nominal price index, 1996 = 1 Wheat Rice 2.3 2.1 1.9 1.7 1.5 1.3 1.1 0.9 0.7 Beef Poultry Pork 0.5 1996 2000 2004 2008 2012 2017 soon sent alarm bells in world markets, which had expected that ample Russian grain stocks could hold off any supply shock and maintain prices. Added to that, current logistics have been unable to cope with the unexpected surge in export demand for grain in other countries. In France for instance, a shortage of transport and silo capacities at the harbours were simply inadequate for handling the sudden deluge in volumes, holding up grain shipments as a result. In today’s complex world of multilateral exchanges, one glitch in the supply chain is all it takes to paralyse the fl ow of goods and services and cause jitters in the market. The fact that logistical systems rarely tolerate any disruptions in the supply chain is evident in these recent examples. In addition, any medium-term forecast is concerned only with economic fundamentals, and not unknown factors caused by nature which are impossible to predict. Yet agricultural risks stem largely from such unexpected factors. As long as plants are not grown in greenhouses, water levels and the timing of Whole milk powder 2.3 2.1 1.9 1.7 1.5 1.3 1.1 Skimmed milk powder 0.9 0.7 0.5 1996 2000 2004 2008 2012 2017 Source: Secretariats of the OECD and FAO.
Gilbert Daverdisse, Climmar invites dealers to <strong>Agritechnica</strong> in Hanover. seasonal changes will have a huge impact on the output and quality of harvests. The globalisation of trade further increases the overall risks and amplifi es their effects, resulting in major and sudden fl uctuations in raw materials prices, which are themselves subject to much market speculation. Examples of such unpredictability abound in the agricultural market. Barely three months earlier, analysts were predicting that the income of cereal growers, which had fallen in 2009, were unlikely to increase this year. Yet today, we see that their incomes have risen quite substantially, helped by the key factors of quality, quantity and price. On the other hand, milk producers, who have enjoyed a contractual increase in the price of milk, are now complaining that costs have soared due to a rise in cereal prices. This is due to the drought which has cut down available amounts of fodder crop and straw. Clearly, providing an accurate forecast of agricultural markets is an almost impossible task. The future for dealerships Although the fundamentals in agriculture are still synonymous with growth, volatility in prices and agricultural income are now the norm. Agricultural machinery dealerships must learn to cope with these major fl uctuations and work with, rather than against them. Although turnover is highly dependent on distribution, dealerships are mostly regarded as equipment-based companies, with more than half of all employees working in technical services. There is a need to constantly raise the level of human resource expertise and skills in dealerships. Firstly, workshop and store facilities must account for an important part of structural costs if the company is to withstand periods of downturn in sales. There can be no sales without good service, which is why this must be maintained at any cost. By focusing on the cost effectiveness of after-sales service, dealers are offering an additional good with a market value that can be sold. This increases the product’s value and improves the dealer’s bottom-line in the long run. Next, fi rms should tap on prosperous times to optimise their margins as this would help them tide through leaner periods. The dealer should carry out a professional assessment of second-hand items while at the same time checking if it is able to cover any losses should the market value fall below what was paid during trade-in. Trade-in prices have already started to slump, and subsequently, the rate of rejection for second-hand equipment will increase. As both the service and second-hand market form the core of the second-hand trade, the value-add of these activities must be suffi - ciently high so that companies would not just stay afl oat but also thrive. This means that the relationship between dealers and farmers is bound to evolve. And that change has only just begun. Dealer satisfaction CLIMMAR has a dealer satisfaction index set up specifi cally to help dealers. Originally conceptualised in France for manufacturers, the index is now used in six other countries. Specifi c European data based on more than 1000 surveys from all over Europe were collected and used as the database for this index. Apart from its roles as a European toolbox and pool of ideas, CLIMMAR is also a source of information for comparing ratios, markets, economic climates and guarantees. The annual CLIMMAR congress is the key event for the exchange and collection of information. Training is another important aspect of the organisation. The 2nd CLIMMAR Skills, a competition open to mechanics and mechanical engineers, helps assess the various European training systems while promoting the dealership trade. CLIMMAR also encourages all member countries to participate in major events, notably <strong>Agritechnica</strong> which will be held from 13 to 19 November 2011 in Hanover, Germany. Gilbert Daverdisse Double safety! Search online. Purchase on-site. World Trade Fair for Used Technology 6 to 8 April 2011 Cologne, Germany Organisers: Koelnmesse GmbH and Hess GmbH Technical sponsor: FDM e.V. Registration and information: Tel. +49 7244 7075-0 www.usetec.com 2011 | 1 | TRADER 19
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