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Behind the scenes: The rise of the super farm machinery dealership

We look behind the scenes of an expanding dealership, charting its rise from humble beginnings to its current grand ambition as it grows to become a multi-branch outfit.

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Behind the scenes: The rise of the super farm machinery dealership

Practically brought up in the workshop of his parents’ Pilling-based John Deere dealership, it was almost a given that Stuart Cornthwaite would end up in the farm machinery business.

 

Fast forward to 2007 and Mr Cornthwaite became the owner of his own dealership, setting him on a path of expansion which would see his business become one of the UK’s top John Deere dealers.

 

Now covering an area from north Shropshire to Dumfries and Galloway, it is fair to say Mr Cornthwaite, 42, has seen some rapid growth with his business, but where did it all start, how did it happen and at what cost?

 

Mr Cornthwaite’s interest in farm machinery started at an early age when he would help out most nights after school at his father’s dealership, eventually leading to a full-time job.

 

He says: “The original idea was to become one of those ‘cool’ technicians, but it turns out fixing things was not my forte.

 

“After three years of this, I moved to the parts department where I learned an appreciation for good customer relations.”

 

Buzz

 

Spurred on by this interest in customer interaction, it was decided Mr Cornthwaite should hit the road and sell some machinery. Armed with a list of contacts and a Peugeot 309, he set about selling.

“I really enjoyed it. Meeting people and getting the deals done was a real buzz.”

 

From here, Mr Cornthwaite continued to take on responsibility in the business and in 2000 he took on the running of the company’s sister branch in Bispham Green, Ormskirk, originally bought by his father John in 1981.

 

Mr Cornthwaite began to push the Bispham business forward, which saw him take on John Ashe in 2003 as finance director.

 

“While I was good at selling, I needed someone to look after the numbers,” says Mr Cornthwaite.

 

But as many people can testify to, relationships can be tested when working with family. And with their opinions increasingly divided over how the company should develop, it was decided the business should be split, with Mr Cornthwaite buying the Bispham Green business in 2007.

 

It is fair to say Stuart Cornthwaite and John Ashe were not short of drive in those early days.

 

Ambition

 

Mr Cornthwaite says: “Our ambition was to have five branches running up the M6 and a turnover of £100 million within 10 years.”

 

Mr Ashe adds: “Shortly after we started out, we travelled to John Deere to present our vision and it is fair to say they were quite shocked.”

 

Mr Cornthwaite says: “It was not about being the biggest dealer, the drive was to develop a business which was large enough to sustain the challenges the industry would face, attract the best people and ultimately have a business model which could offer the best deals and service.”

 

Having seen what was happening in the car business and looking at the direction specialist kit was heading in, Mr Cornthwaite concluded a single branch dealership would not be able to support this.

“It was already happening further south with some John Deere dealers I know well, so I followed their development with interest. I soon realised you need the scale of multiple branches to look after a diverse portfolio of equipment.”

 

The timing of this grand plan could not have been better as it fitted with John Deere’s ‘Dealer of Tomorrow’ strategy. And with consent from the manufacturer to set about expansion, the pair began talks with Nantwich Deere dealer Agricultural Machinery.

 

Founded by the Hughes family 50 years prior, the Cornthwaites bought the company in 2009, retaining Rob Hughes, now the Cornthwaite Group’s after sales director and a key factor in its development.

 

Mr Cornthwaite says: “We learned a lot from that first acquisition. It really opened up our eyes as to how service should be done. Rob had the service department at Nantwich running fantastically well and we were keen to expand this performance across the business.”

 

Following the Nantwich acquisition acquisition, Deere was still keen for the business to expand north, but this was not going to be straightforward.

 

As a result, expansion plans stagnated for the next five to six years.

 

Mr Cornthwaite says: “It was not just us either. I think John Deere hoped its dealers would naturally merge or sell to each other but this proved not to be the case.”

 

In late 2015, John Deere facilitated a visit to the US to demonstrate how dealers could develop into larger scale groups. Following this, a meeting with them led to an agreement to take over the north Lancashire and south Cumbria area.

 

“This was the next step in John Deere’s strategy to strengthen its dealership network and provided us with an opportunity,” says Mr Cornthwaite.

Depot

 

“We did approach the existing John Deere dealer in the area to see if he would sell, but we realised this was not possible, so we decided to go it alone.”

 

The search was now on for a new depot in South Lakes and, within 14 months a brand new facility was built at the J36 auction mart. Having opened in February last year, this would eventually become the Cornthwaite Group’s business centre, taking care of all processing of invoicing, administration and business support.

 

But with volume still required to grow the business, both parties were still keen for further expansion, even before construction had finished on the Kendal depot.

 

“We already had some customers in the north Cumbria area and so we were aware of the potential for JD products north to Carlisle. But on exploration we also saw even more potential in the dairying area of Dumfries,” says Mr Cornthwaite.

 

As before, an approach to the existing dealer did not work, so another plan was needed which resulted in a new Cornthwaite Group site being constructed at Heath Hall, Dumfries, and a temporary support outlet being opened in Carlisle, just off junction 43, to provide back-up.

 

Mr Ashe says: “So far the customer response to the Cornthwaite Group moving into this new area has been positive.

 

“We made a massive effort to introduce ourselves in the new areas, with one guy visiting 600 farms in two months – not to sell, just as a courtesy call.”

 

Spaced roughly 50 miles apart up the M6, the group’s depots will all eventually offer the same capabilities.

 

Mr Ashe says: “Our biggest challenge is that our territory is very linear. Unlike a cluster of depots which can be supported by a central depot, each one of ours needs to be self-sufficient.

 

“It also means we need twice as many demo machines to cover the north and the south.

MORE

“Both routes of expansion come with their own set of pros and cons. Buying a company means you inherit its way of working while building a new branch allows for a fresh start.

 

Expand

 

“In both instances we try and instill the group’s DNA in each depot.”

 

Now a £75m turnover business, is the end game in sight?

 

Mr Cornthwaite says: “We still have a lot to prove and we would like to expand further, possibly in another country. Who says you have to be next door to where you are at?”

 

Bringing it in line with the group’s latest depots, the Nantwich branch is set to receive a £750,000 makeover.

 

“Our outlets need to look the part, not only to sell tractors and machinery, but to attract potential employees. We now have the scale which is eye-catching to potential staff, allowing them to progress through the business.”

 

The firm employs 104 people, with several positions still to be filled.

 

Mr Ashe says: “Despite massive advancements in technology, more than ever it is still a people business. And it takes a lot more than just one person to sell a tractor these days. It has to be demonstrated properly, sold properly, have the finance calculated properly, installed properly and be backed up properly.”

 

Mr Cornthwaite says: “My biggest challenge is learning to let other people get on with things and understand I cannot know everything which is going on in the business any more. I have to say we have only got to this point due to having such a great team.

 

"From our management staff all the way through the business, I am proud of them all. Some of them were even around back in the day when I was in the workshop in Pilling.”

 

With apprenticeships back in fashion, Mr Cornthwaite says there are a lot of opportunities for young people in a dealership.

 

“We need to keep feeding in about half a dozen apprentices per year. I feel dealers, manufacturers and the industry in general are not doing enough to promote apprenticeships and attract more youngsters.”

MACHINERY MARKET

MACHINERY MARKET

ON average, the group sells about 35 new tractors per month. But like many things, you cannot have one without the other and new and used tractor sales are no exception.

 

Mr Cornthwaite says: “Sales of new and used tractors go hand in hand. If you cannot sell your used tractors, it can choke a business.

 

“Before the big crash in 2008/2009, we used to export most of our used tractors. But when this route closed up it made us re-engage very quickly about how to retail used equipment.

 

“Now, we have more of a balance between retail and export of used kit, with quality used tractors now coming into play for customers in the UK not willing to pay the higher prices of new machines.

 

Distribution

 

“We also now have a dedicated team focusing on used machinery always looking for new and developing distribution channels.”

 

But throw in certain political uncertainties, volatile commodity prices and unpredictable weather, and the job of selling kit has the potential to get even harder.

 

Mr Ashe adds: “We have not yet noticed a negative effect of Brexit – sales actually went up after the referendum. Our advantage is we cover a large and diverse area, which evens out any commodity price and weather influences.”

 

Though the Cornthwaite Group has to prioritise John Deere as its main franchise, it is otherwise free to choose any other makes of machinery to sell, as long it does not conflict with a Deere product.

 

Mr Ashe says: “The challenge is to find franchises which complement the John Deere products. Also, finding franchises suitable for the whole group is hard when expanding, as a franchise could already be represented in that area.

 

“And while we can pick and choose certain product lines from manufacturers, it is not always fair on them for us to only offer one or two of their machines.”

PRODUCT EVOLUTION

PRODUCT EVOLUTION

THOUGH he would not recommend it now, Mr Cornthwaite bunked off school to attend the launch of the John Deere 6000 Series tractor in 1992.

 

“As a chassis tractor, this really put Deere on the map in the UK,” he says.

 

“Along with Agco’s acquisitions and Case and New Holland’s merger in the late 1990s, the door was wide open for John Deere to increase market share.”

 

While the 6910 and 6930 remain firm favourites of Mr Cornthwaite, he believes Deere is heading in the right direction with its current and future product developments.

 

Listen

 

“They listen a lot more than they used to, which is reflected in recent products.”

 

However, it is not just the hardware which is popular, so much so it is now often the topic of software which is leading the sales conversations.

 

Telematics is a massive part of the business, says Mr Cornthwaite, with four full-time ag-support specialists dedicated to the tech.

 

“Particularly when it comes to service planning, remote diagnostics, fleet management and product optimisation, it will become even more key in the future.

 

“Guidance and automatic steering technology is also a lot more viable than it used to be, and is increasingly being specified to improve efficiency.”

 

The way people are buying tractors is also evolving.

 

“Product information tools available to the customer are far greater than they ever were, which means our own product knowledge has to be spot on,” he says.

 

“Like the car industry, customers can now configure their tractors online. However, they still need talking through the final package.

 

“Our most popular models are the 6155R, 6130R and the 6250R. To keep lead times short, we keep a large stock of popular models and specs at all times – you need something in your shop window.”

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