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Max Stephans, ag sales manager; Kenny Bergmann, corporate sales manager; Caleb Wehrman, general manager; and Eric Schnelle, president
Max Stephans, ag sales manager; Kenny Bergmann, corporate sales manager; Caleb Wehrman, general manager; and Eric Schnelle, president

2015 Dynamic Dozen No. 6: S&H Farm Supply Inc.

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Once a farmer, always a farmer or so it seems.

The Schnelle family in Lockwood has sold equipment to farmers since 1969. While time has changed the marketplace and technologies, President Eric Schnelle says the business principles for farmers haven’t changed at S&H Farm Supply Inc.

“My father started the business, and he was a farmer,” Schnelle says of his dad, Wayne, who formed the “S and H” with business partner Erwin Hedeman. “His philosophy was to find a good brand and keep a good inventory in stock.”

Couple that with what Schnelle calls reasonable prices and financing partners, and the company formula has brought annual revenue to $71.75 million between four stores last year. Sales ticked up 13 percent in 2014, but growth over the last three years clocked in at 34 percent.

The company exclusively sold and serviced farm equipment in rural Lockwood until the Schnelles branched out to Rogersville in 2005 and Mountain Grove and Joplin in 2008. More recently, they’ve also positioned some products outside of the farming market.

“In 2013, we listened to our customers and brought on a new line of ATVs and UTVs,” Schnelle says of adding the Polaris line.

With leading brands Kioti, New Holland and Bad Boy, S&H stores each sell over $1 million in Polaris products.

A few years ago, S&H experienced a similar sales surge when it added Kioti to tap into the burgeoning rural lifestyle customer – those who typically live in the city but own acreage outside the city.

Schnelle says these business decisions follow a philosophy articulated by Corporate Sales Manager Kenny Bergmann: Focus on what the customers want to buy rather than what they can sell customers.

S&H stores pull from over 200 miscellaneous brands of new equipment, parts, supplies and used items. The company is a dealer for the Alamo Group, with such agricultural brands as Rhino and Bush Hog.

“A lot of times, you sell a tractor, you sell a brush hog along with it,” Schnelle says. “We’ve had  a lot of cross-selling to existing customers.”

With 40 to 50 core brands, Schnelle says 70 percent of sales are in new equipment, pointing to over $10 million in annual New Holland equipment sales, for example.

Two segments with noted comebacks, he says, are lawn and garden and cattle farming.

“Cattle numbers have been down in the U.S. There are a lot of farmers retiring and not a lot of new farmers getting into the market,” Schnelle says.

Cattle prices are up, but so are farmers’ operational costs – and both are affecting his business. Economics play a big part in what’s stocked at the stores. After all, these are farmers who could spend upwards of $100,000 on a tractor to bale hay for, say, 500 to 1,000 head of cattle.

“We’re at a good part of the curve. When farmers make money, they invest in their equipment,” he says, noting the tax advantages from replacing depreciated capital.

To stay ahead of market curves, Schnelle says the corporate management team meets quarterly. His dad, now 83, also is still active.

“These meetings are brainstorming, looking at the past and forecasting the future,” he says. “Whether analyzing ground crops, cattle futures or storm predictions, there are numbers and charts and a lot of discussion.”[[In-content Ad]]

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