Ag equipment dealer consolidation has long been a mainstay of the farm equipment industry, and the recently released 2022 Big Dealer Report published by Lessiter Media suggests consolidation is continuing its rapid pace.
This year’s results show both the total number of big dealers increasing along with the total number of ag stores owned by big dealers. For 2022, the number of big dealers rose to 214 — the highest number of big dealers since the report started in 2011 — from 197 in 2021, an 8.6% increase. Big dealers now own 38% of total ag stores in North America vs. 35% in 2021. The trend is likely to continue in 2022.
There’s been a notable increase in Kubota “big dealers” (those who operate 5 or more ag locations). While speaking with George Russell, who collaborates on the Big Dealer Report, he highlighted the notable push by Kubota for Kubota-only branded stores and for dealership groups with scale.
Kubota big dealers saw the biggest changes year-over-year, totaling 33 in 2022, up from 19 in 2021. Nearly all of Kubota’s big dealers fall in the 5-9 store range, with 30 big dealers. The other 3 Kubota big dealers fall into the 10-14 store group.
Whether or not dealer consolidation is a good thing always depends on who you ask. Consolidation certainly offers dealers the scale to provide enhanced services to both their customers and their employees. However, that’s not to say there aren’t some very strong 1-4 store dealerships out there that are providing excellent customer service and are good employers.
And, without fail, there are comments on the website from customers who are unhappy when their local dealer is acquired by a larger organization. Those complaints often come before the new owners are able to prove that the quality of service will remain.
Editor’s Take:
After spending nearly 22 years of my career working with ag retailers and ag equipment dealers, I can affirm that the consolidation in both of those sectors has been mind-blowing. I am also aware that it is happening in the auto/truck segment as well. It is a fact of life that has been a hot topic of discussion for sometime now. For instance, during the past 20 years, the number of equipment dealers has diminished from approximately 8000 to roughly 3200 today. The number of locations, however, has not shrunk by anywhere near the same proportion. Why? Because farmers want their equipment, parts and service as close to their farm or ranch as possible. In addition, and this is one of the points of discussion with consolidation, farmers/ranchers want to do business with people they know and trust. That is why we encourage CAD members to reach out with things like mobile service or just in time parts delivery. Build communication and trust with the farmers and ranchers in your area. After all, they most likely will end up being your best customer prospects!
