Structural change in agriculture: Analyzing strategic accounts and retailer relationships
Abstract
Agriculture input suppliers, such as independent retailers and cooperatives, are becoming very interested in understanding large producers' operations in order to improve their strategies and prepare for the future of serving their strategic accounts. As corn and soybean farms are growing and expanding they are becoming a unique group of large producers, and suppliers or others in the agriculture industry do not know much about them. An in-depth understanding of the large producers' competitive advantage, decision making process, organizational structure, and strategy for success will benefit retail suppliers by enhancing their knowledge and ability to effectively serve their strategic accounts. This research sets out to understand the structure of large production agriculture operations and their relationships with retail organizations by directly interviewing corn and soybean producers who are categorized as large producers or strategic accounts. The research analyzes survey data from twelve large producers and eighteen retail employee participants. The perspectives of large producers and retail supplier employees are evaluated and gaps are identified in the following areas: characteristics of a salesperson, activities of a salesperson, drivers of producers' seed decisions, and drivers of producers' crop protection chemical decisions. The research is based on qualitative methods to gather descriptive data from the producer participants. The model developed from grounded theory, identifies the ten principal elements to the large producers' success, the six principal elements to the producers' relationships with retail salespeople, and the ten principal elements to the activities of retail suppliers. Descriptive data from discussions with fifteen large producers is used to develop the principal elements in the model. The components will assist retailers in identifying the important areas in which they can add value to the large producers' operations and their relationship in the future. The research concludes that each large farm has individual unique strategies for growth, expansion, and success. It is important for retailers to understand the wants and needs of each producer to effectively add value to their farm. The research determined that the challenges one operation faces may be opportunities for another farm, and vice versa. Also, the research shows that as agriculture producers grow and expand, they become more focused on price and product performance and less focused on the services that retailers offer. The large producers believe that retailers will have to change the structure of their business, adapt their current service offerings, offer different services, and improve their knowledge of each operation they serve, to be valuable as they move forward.
Degree
M.S.
Advisors
Gloy, Purdue University.
Subject Area
Agriculture|Agricultural economics
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