2016 Dynamic Dozen No. 11: S&H Farm Supply Inc.

SBJ: What has the company’s growth enabled you to do?
Eric Schnelle: We continue to expand our marketing and have cool new ways to connect with customers. Last year, we released our own free app for customers to look up equipment, or if a part is bad or they have a service issue. If they don’t want to visit, they can take a picture and send it to our parts or service department. And we can do notifications like any app can to let customers know about a sale.

Internally, the growth has allowed us to hire more specialized people. At the Rogersville store, we’ve been able to expand the lawnmower and power sports parts and service department, and it continues to operate like its own separate business. If you’re coming in and you want a part for your lawnmower, you don’t have to stand in line behind the guy with the round baler ordering parts for 20 minutes. You can go to the lawnmower counter, order blades and go on.

SBJ: Is your fast growth sustainable?
Schnelle: A high amount of growth is not sustainable over time. You can’t just keep growing unless you’re in special circumstances. The last three to four years we’ve added brands like Polaris and continued to grow our lawnmower and ag lines, and that led to some increases in those years. We see the curve flattening out, so we don’t think the growth will continue skyrocketing. But when you’re doing parts and service and support, there are a lot of pieces to the puzzle that greatly increase when your sales increase, too.

SBJ: Where is the tipping point?
Schnelle: Usually sales are easy to grow, but then as a service organization you can’t take care of all the customers you sell to. And we struggle with seasonal business, no matter when we were one store or four stores.

When we’re looking at the ag side with the seasonality of hay harvest, there’s a short window. You sell products all year long but they all need service in the same window. We had that problem when we sold 10 balers; we have that problem when we sell 100 balers a year.

SBJ: What is the worst business advice you’ve received?
Schnelle: A lot of businesses like us, it’s all about market share and market share growth. What that means is that our manufacturers look at how many units you sell in your area versus the competition and and it’s always this race. Is your share growing, are you gaining more customers, are you selling more of brand X than the competitors?

I think that’s important, but we’ve heard people say that you’re to grow market share regardless of anything – regardless of profitability – and that everything depends on it. Market share is important, but it’s not everything. You have to run your business, take care of customers, make enough money to keep the doors open and take care of the core business values first, while keeping an eye on market share and not let it totally dictate everything you do.