TFF Group buys ?

Grass And Grain · Dec 12, 2019

Brisel said:
I'm interested in this but have just read all 8 pages, so apologies if these have been answered already;

Free? In order to get a decent discount someone has to administer the logistics and send a van out with small batches for each farm. What will this offer the manufacturer/wholesaler that would incentivise them to offer a discount to cut out a middleman? For the discount, both parties need to gain something here. I appreciate that IT can replace a lot of people but someone will have to chase up payments or at least set up a card based system, arrange deliveries, sit at the table with suppliers etc. By taking a % instead of a basic membership fee of a couple of hundred quid to pay "fixed" costs plus a % of turnover on top leaves the group organiser seriously exposed. Would it be a not for profit business @Clive ? I would be suspicious is there wasn't something in it for you. If you're adding value to TFF members, why shouldn't you make a quid or tow for your trouble and not inconsiderable risk?

What are the margins on some of these products? IMO the amount varies but I'll bet it's not much on many agchems, especially generics. How much extra value is there to be captured?

As an aside, I'm a member of a very big buying group, who until recently had become rather flabby and inefficient. At the moment they are getting me quality products within a £ or two of FMP prices and they have got me more rebates this year than I've spent on fees and levies. The outgoing CEO has stripped it back to the core buying group it once was. I'd rather pay fees & levies and get the best prices available rather than the smoke-and-mirrors of a reasonable price then a non specific rebate but I'm still happy I'm getting a good deal from a group who sit at the same top table with the manufacturers when buying hundreds of millions of pounds of farm inputs every year. Are there inefficiencies? Yes. Is there a car park by their office with some nice cars parked there? Yep. Pay peanuts, get monkeys.

I presume the current offerings of buying groups just purchase from the distributors (thinking agchems for now).

I presume the Clive/tff idea is to buy direct from manufacturer, but then need to organise warehousing, delivery etc. So basically become a clive/farmer owned distributor.

Question is, can the logistics be done efficiently enough to leave a margin and/or cheaper product. Is there a way to deliver agchems using courier? Or does it require a network of depots and vans?

As I suggested before, the realy big savings would come if it were to become the market leader and get almost 100% control of the purchasing market. No reason why it can't be done with support from farmers.

Why don't buying groups currently buy direct from agchem manufacturers? I guess they are just using the easy route of using distributors to warehouse and deliver.

teslacoils · Dec 12, 2019

500lt of aviator, or 1000ac worth, is £16500. It pretty much fits on a pallet. Logistics of getting that to me can't be overly complicated.

Full pallet prices direct from the producer. Bish bash bosh.

Clive · Dec 12, 2019

teslacoils said:
500lt of aviator, or 1000ac worth, is £16500. It pretty much fits on a pallet. Logistics of getting that to me can't be overly complicated.

Full pallet prices direct from the producer. Bish bash bosh.

Haz chem network = £40 - when do you want it ? tomorrow before 11am ? I can organize that with a few clicks of my mouse now for you without even speaking to anyone

why anyone things the big 5 are better of more efficient at logistics than the HUGE national logistics / hub companies that do millions of deliveries every day I have no idea! There is a cooperative part of that network that does haz chem

the logistics are quite easy to solve in far more efficient (cheaper) ways

Clive · Dec 12, 2019

Grass And Grain said:
Why don't buying groups currently buy direct from agchem manufacturers? I guess they are just using the easy route of using distributors to warehouse and deliver.

The biggest one did try this but they need to maintain relationships with existing distributors so they can supply fee-paying members with a full range. Distributors obviously feel threatened by this so ............... maybe you can guess what "allegedly" happened next ! (note I'm choosing my words quite carefully !)

You do need big volume to talk directly to some manufacturers, however, no so much the case with the many smaller generic cos however

teslacoils · Dec 12, 2019

Clive said:
Haz chem network = £40 - when do you want it ? tomorrow before 11am ? I can organize that with a few clicks of my mouse now for you without even speaking to anyone

why anyone things the big 5 are better of more efficient at logistics than the HUGE national logistics / hub companies that do millions of deliveries every day I have no idea! There is a cooperative part of that network that does haz chem

the logistics are quite easy to solve in far more efficient (cheaper) ways

Indeed. Although £3/4m sounds a lot, it's not really many acres of wheat at 0.6 liberator, 1.25 aviator, and some proline is it....

Suffolk Serf · Dec 12, 2019

DrWazzock said:
Haven't read it all, but we are already a member of huge farming buyers group, so the ship has sailed on that front surely. Are there really any farmers left who don't already benefit from being member of bulk buying group? Not saying it isn't a worthy idea but it's already been done for 40 years by experts, with my own family instrumental in setting it up back in the 1960's.

I would tend to agree.
Group buying takes a particular mindset and nearly everyone with that mindset is already in a buying group and committed to it.

Brisel · Dec 12, 2019

Suffolk Serf said:
I would tend to agree.
Group buying takes a particular mindset and nearly everyone with that mindset is already in a buying group and committed to it.

You've still got to keep an eye on the prices you get from them. They aren't always the cheapest - I've found mine to be useless on utilities and fuel compared to our own big supply contracts (85 mobiles across the company). Fuel was 3 ppl dearer - 1 ppl dearer on price plus their 2p levy, compared to my usual suppliers who just quote on the day I ask.

Brisel · Dec 12, 2019

Grass And Grain said:
I presume the current offerings of buying groups just purchase from the distributors (thinking agchems for now).

I presume the Clive/tff idea is to buy direct from manufacturer, but then need to organise warehousing, delivery etc. So basically become a clive/farmer owned distributor.

Question is, can the logistics be done efficiently enough to leave a margin and/or cheaper product. Is there a way to deliver agchems using courier? Or does it require a network of depots and vans?

As I suggested before, the realy big savings would come if it were to become the market leader and get almost 100% control of the purchasing market. No reason why it can't be done with support from farmers.

Why don't buying groups currently buy direct from agchem manufacturers? I guess they are just using the easy route of using distributors to warehouse and deliver.

I'll find out more about the fate of AF Logic who were building their own stores. No doubt the main distributors pushed back pretty hard against them.

Suffolk Serf · Dec 12, 2019

Brisel said:
You've still got to keep an eye on the prices you get from them. They aren't always the cheapest - I've found mine to be useless on utilities and fuel compared to our own big supply contracts (85 mobiles across the company). Fuel was 3 ppl dearer - 1 ppl dearer on price plus their 2p levy, compared to my usual suppliers who just quote on the day I ask.

I don't use mine (Fram) for mobile phone but do for fuel, just using them to save legwork really.
I my case the really useful savings have come from feed- where we have a committed tonnage in a group, a mill makes the grub for an agreed margin and we pool our main raw material buying.
A serious saving has been made though in pig vaccines, this goes out to tender annually to vet practices and the large volume involved has really shaken up the sector with very significant savings being made.

puntabrava · Dec 12, 2019

Green Giants 750a disc thread needs to be searched and posted here.

juke · Dec 12, 2019

after reading through all this thread, why is it when clive trys to do something to help farmers he is met with hostility, so what if he makes a few quid from it, if infact he would.

its always the same in farming "allways done it this way " or" we don't like change.".

Steevo · Dec 12, 2019

teslacoils said:
No, but if I can buy the same product, like aviator or proline, for whatever the middlemen pay, simply for paying up front or similar then I'm fine with that.

If being a bit organised and taking a bit of risk gets me almost all the markup, and the only downside are a few less of the shiney shoes brigade then that ticks all my boxes.

I'd be very surprised if the distributors pay for the product up front from the manufacturers!

I would not be at all surprised if they have payment terms similar to that of Tesco - 4 payment dates, one each quarter in arrears.

kiwi pom · Dec 12, 2019

teslacoils said:
500lt of aviator, or 1000ac worth, is £16500. It pretty much fits on a pallet. Logistics of getting that to me can't be overly complicated.

Full pallet prices direct from the producer. Bish bash bosh.

The bit I don't get about buying direct is not how the last mile delivery works but what happens to your 'Aviator' the day it leaves the factory?
I thought a lot of chems were delivered on a next day basis depending on agronomist advice?
There's a thread on here somewhere about this years unused seed and chemical, what happens to that if you've bought it direct?

Clive · Dec 12, 2019

juke said:
after reading through all this thread, why is it when clive trys to do something to help farmers he is met with hostility, so what if he makes a few quid from it, if infact he would.

its always the same in farming "allways done it this way " or" we don't like change.".

I don't take it personally - I think it just farmers in general really not being good at change or working together or understanding how they can use cooperation to change their fortunes, they are always looking for the "catch" !

Ultimately that's the big hurdle here and not really any of the other solvable issues raised so far

Farma Parma · Dec 12, 2019

Steevo said:
I'd be very surprised if the distributors pay for the product up front from the manufacturers!

I would not be at all surprised if they have payment terms similar to that of Tesco - 4 payment dates, one each quarter in arrears.

Is that how a certain 5 letter Ag suppler offers me standard 90days credit on Agchems then?

Clive · Dec 12, 2019

Farma Parma said:
Is that how a certain 5 letter Ag suppler offers me standard 90days credit on Agchems then?

that and the fact they have large margins that can absorb the cost of some credit as well yes

Farma Parma · Dec 12, 2019

Clive said:
that and the fact they have large margins that can absorb the cost of some credit as well yes

Its a really helpfull Credit Fac tho there is no denying that
some of us on here & am no diff might struggle to keep the cashflowing without such a thing, then again if you think
there is big savings to be made iam sure we could sort that minor hassle hehee

Clive · Dec 12, 2019

So basically this

Derrick Hughes · Dec 12, 2019

It would be nice to have someone else to find the best possible price as it gets boring if you are buying a lot of one product and you cant trust your supplier to give you the best fairest price as i found out with Fuel today , fuel cards being another con . Who can be bothered to check their weekly price that is ofen higher than pump price
I will be buying more from out machinery ring buying group who i trust to do the work for me
@Clive , did you not have a fuel price tracker on here ?

puntabrava · Dec 12, 2019

Mobile phone contracts would be a start, the Coverage of the masts is all similar, imagine putting a 10000 item contract out to tender. I have been with Vodafone for 32 years and hate the buggers.

TFF Group buys ?

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100% I’ve had enough of farming!

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