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Patrick Sullivan: Digital platform empowers farmers and helps retailers

August 26, 2019

 About 8% of farmers in the U.S. were purchasing crop inputs and services online in 2018. That number is expected to be closer to 15% for 2019.

The following is an edited transcript of Tom Martin’s interview with Patrick Sullivan, partnership manager at AgVend. Click below to hear the full audio.

Tom:            Trying something new doesn't have to be scary; fresh digital platforms open up a world of possibilities. How can new digital platforms empower farmers and help retailers extend their reach? We take that question to Patrick Sullivan.


                     Patrick is a partnership manager at AgVend, where he's responsible for helping many of the top ag retailers in the U.S. grow their e-commerce businesses on the AgVend Marketplace and on their own digital storefronts. Prior to AgVend, Sullivan worked for Alltech Crop Science as the territory sales manager for the northeastern and mid-Atlantic U.S. He received a bachelor's degree in plant sciences from Cornell University and a master's in agriculture from Western Kentucky University. Thanks for joining us, Patrick.


Patrick:         Yeah, happy to be here.


Tom:            So, tell us a little bit about AgVend. How does it help farmers?


Patrick:         AgVend is working to power digital commerce in agriculture. We're working to do that constructively through the existing ag retail channel, and we partner, as you alluded to, with agricultural retailers, selling through our marketplace, which is, where they can come buy from a number of different retailers, shop their options and make their purchases, all in one spot. We also help those retailers with digital storefronts — so, building their own e-commerce presence and bringing them closer to their customers. We help farmers save both time and money. They're empowered with more knowledge. They're easy to look up, what products they want, what the pricing is, what different options are available, so they're able to quickly go make those decisions whenever they want. The e-commerce is open 24/7. There's no cost, there's no membership, so it's easily accessible information for them.


Tom:            And these are all critical purchases. Do you find farmers reluctant to make these kinds of purchases online?


Patrick:         Farmers are more accustomed to making purchases online in their personal lives. That was one of the foundations of our company, is talking to farmers and saying, "Hey, we buy a lot of our home goods online, but these aren't available there." Now, especially connecting with the retailers, once they know that there's a retailer behind it, they're a lot more comfortable. There are some guys that have taken a little time and made calls five or six times before they make a couple-hundred-dollar order, and guys that place a half-a-million-dollar order just by coming and clicking, so it can all vary.


Tom:            How do you go about assuring them of the quality of what they're finding online?


Patrick:         We're working with the top retailers in the industry, so many of the CropLife 100, the biggest retailers, many of their top ones. And these are coming from the approved channels, from the manufacturers that come with the warranties, the rebates, the financing programs that they're all used to. We also back all of our purchases, and we'll close it with the retailer if there ever was an issue for them.


Tom:            So, the retailer is kept hidden until the purchase is made. Why is that?


Patrick:         On our marketplace, they're kept hidden until the purchase is made. That's to protect their pricing power, so it allows them to list all of their products and services at different segments so they can target a more transactional, low-service customer and a full-service customer and not have to worry about explaining the differences out there in the marketplace.


Tom:            And then, at what point in the process do they find out who the vendor is?


Patrick:         On our marketplace, they find out immediately at purchase. So, you click "checkout," and the retailer is shown to you there on the confirmation page. We also send it to you in an email and our retailers contact you within one business day to arrange the pickup or delivery of that product.


Tom:            Okay. Let's talk a little bit about that fear factor and the uncertainty of trying something new. Are there significant numbers of farmers — and retailers, for that matter — out there who still have not warmed up to digital platforms as a means to grow their markets and their reach?


Patrick:         I think that's less and less. In terms of farmers, there were 8 to 10%, in 2018, that were purchasing online; that's expected to be closer to 15% this coming year. Additionally, there are more farmers — I think it's about 45% — saying that they would purchase online. Again, that's in part because they purchase there and because of other components of their lives previously. Additionally, if you look at the purchasing process as more than just that transaction, click and buy, farmers want more of that online interaction. They want to be able to browse at their own convenience, evaluate their options. We are finding that the retailers are quickly warming up to this because there's this demand from their growers for this more convenient experience. Some of our partners in our marketplace decided to create a storefront for their own customers because they were finding that about 10% of their purchases on the marketplace were from their own customers already, so that's quickly changing.


                     We worked with about 40 retailers in our first year at AgVend. I expect, over the next year, there'll probably be three times as many, as we expand into new geographies and into Canada as well.


Tom:            And as you're working with these retailers, what would you say are the most outstanding challenges that you encounter or have to overcome?


Patrick:         It's changing the perception of e-commerce within the organization. Previously, e-commerce was thought of as separate and somewhat as a threat, and this is showing them that it can be an advantage — not just to the leadership of that company, but throughout their entire sales organization.


Tom:            So, Patrick, what trends or innovations are you keeping an eye on now?


Patrick:         I think there's just a host of more digital tools coming to the grower. Being at ONE: The Alltech Ideas Conference last year, (I learned that) agriculture is one of the least digitized industries, and that's quickly changing from the transaction part, but also through all of the tools. We'll be seeing more of those interacting together to bring a better experience to farmers.


Tom:            And, when you see that, you must see enormous growth potential.


Patrick:         Oh yeah, it's a tremendous opportunity for both farmers and retailers.


Tom:            Patrick Sullivan is a partnership manager at AgVend. Thank you so much, Patrick.


Patrick Sullivan spoke at ONE: The Alltech Ideas Conference. Click here for more talks from industry leaders who appeared at ONE19.