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We always have thought of our industry as being dynamic and fast-paced, but the current torrent of change is virtually overwhelming for many.
While most of the publicity on farm and food industry trends focuses on retail mergers and processor restructuring, the change occurring in the farm supply/service sector may be even more significant. This segment's unique institutions and major product lines have evolved over the years to meet the needs of its customer base. But, a wave of powerful new forces affecting the entire industry promises to reshape the inputs sector. Moreover, this fundamental change comes while the customer base is shrinking in numbers and growing in scale. Consider:
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e-Commerce. The combination of growing internet access and powerful information technology is fundamentally revamping supplier-customer relationships, even "eliminating geography," with profound implications for the vast array of dealer networks, local suppliers, and traditional relationships;
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Biotechnology. This new technology alone affects the inputs sector in three key ways: the new plants and animals emerging require a new mix of farm supply/service; new value-enhanced products bring new product storage-handling, transportation and marketing requirements; and the combination is accelerating integration of the farm sector into the food system through contracts, alliances, and other new arrangements altering long-standing customer-input supplier relationships;
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Globalization. A term connoting the wave of competitive forces driving industry restructuring, quite apart from the other forces. New trade agreements, more open economies everywhere, rapid global movement of capital and technology, all are increasing competition and forcing cost reductions in every manner possible including shortening the supply chain, new alliances, consolidation, etc., affecting suppliers and farms alike; and
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Changing Customer Base. Although not widely appreciated, the commercial farm sector is highly concentrated and enormously changed from only a few years ago. The small number (157,000 operations, 8% of the total) of commercial farms that purchase 70% of all inputs and services are becoming far more sophisticated, demanding customers. They require more technical inputs and services in different mixes, new and different services, have far different capital needs and compete in nationwide markets, trends that are changing the entire customer focus for input suppliers.
These forces, as they evolve together, are making much of the existing farm service complex redundant or, at least, are precipitating enormous change. We invite you to join us in a special examination of the future of the North American farm supply/service industry. We have developed very considerable expertise in recent months through detailed evaluations of biotechnology, e-commerce, and globalization. These, combined with our in-depth knowledge of the farm sector and the food industry, provide a strong basis for a careful analysis of likely future impacts on the farm supply/service sector.
I invite you to review the attached prospectus that explains the project in detail. We would welcome an opportunity to work with you on this important topic.
Sincerely,
Bruce A. Scherr
President
Chief Executive Officer
Informa Economics, Inc.
Read the
entire prospectus
or e-mail
info@informaecon.com for more details....
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