AGCO Corp. executives invited some 230 dealers from seven states who operate within a 150-mile radius of its Independence, Mo., parts distribution center to a special dealers meeting that also featured a ribbon-cutting and tour to officially open the center as a full stocking depot.
AGCO has invested more than $100 million in additional inventory at the facility and reconfigured existing space in the 900,000 square-foot, underground warehouse to hold 40% more parts than it did originally.
The goal is to provide faster service to the AGCO network of dealerships, allowing them to provide better service to their customers. Hans Lehmann, vice president, AGCO Parts, North America, told members of the farm media invited to the event that the Independence facility will be able to deliver any critical part to dealers by overnight ground transportation.
Farmers as well as dealers also have the option of driving to Independence – or sending their wife – to pick up a part from the depot.
Bob Crain, senior vice president and general manager of AGCO North America said the goal is strengthen the core capability of the company to provide parts and support to dealers and customers, something he believes will encourage more farmers to buy an AGCO brand when they buy new machinery.
"This expansion, just like our investment and research and development and capital outlays to improve manufacturing plants and systems, is part of a grand plan for dramatic growth in the North American market," Crain said. "We are laying the foundation that will let that dramatic growth occur. We have already seen that growth through dealership like Lane Diesel."
Independence becomes the fourth full stocking depot for AGCO and Joe DiPietro, senior manager for strategy and performance improvement for AGCO Parts, said other critical parts depots are being carefully monitored to determine if they, too, should be upgraded.
Crain said a survey of competitors' customers showed that when farmers are considering a change of brands, support from the manufacturer and parts availability from their local is a significant factor for 85% of potential customers.
The immediate goal for the Independence facility is to provide 70% of the parts ordered by any of its local dealers from that center. Once that is achieved, he said, the bar will be raised.
Brian Lang, owner of Lang Diesel Inc. in Hays, operates out of 10 locations. He said the increase of inventory at Independence will be of tremendous benefit to his organization.
While the primary emphasis is on the 230 dealers in proximity of the depot, Lehmann said that parts that only available there, such as those for Sunflower tillage equipment, will ship anywhere in North America.
Jason Marx, vice president of marketing for AGCO North America, said AGCO has a tremendous competitive advantage in its Generation 2 e3 selective catalytic reduction clean-air technology for improved emissions, minimal maintenance and exceptional fuel efficiency.
"Customers are telling us they are getting 30% improvement in fuel efficiency over our competitors' products when you look at the cost of fuel, that is a big advantage. Just ask your custom cutters or custom applicators what efficiency means to their bottom line. Now, you add in how quick we can get parts to field and get the farmer back to work and I think it's a great time to be sitting in my chair."
Marx also said the grand opening on AGCO's new Jackson, Minn. factory will be June 7, adding an ability to promote the company's role in "in-sourcing" rather than "out-sourcing" jobs. The plant will employ 264 workers.