Posted by JD Seller on December 09, 2018 at 09:28:56 from (208.126.198.213):
A family member told me that JD equipment, of Ohio/KY/MI, was selling their ten stores to Ag-Pro Companies effective Dec. 12th, 2018. This Ag-pro already has 60 some dealerships. Have any of you dealt with this Ag-Pro any???? I had never heard of them. Look like a southern company that has been buying up JD stores for the last forty years or so.
Looks like JD is stepping up the move to their dream of only having a few dealership chains for the entire US. In the early 1990s JD corporate people almost would cream their jeans, when they would compare JD to Cat. At the time JD had over 2600 dealerships/ownerships in the US. Cat had under 200 and sold twice the dollars of equipment as JD did. That JD corporate attitude was a real kick in the pants to the dealership owners that just had survived the 1980s. With the majority of them taking their own personal money to keep the JD stores open and JD paid. I asked one of these JD fellows at a meeting what he thought of the increase risk by having fewer owners to weather tough times. He looked at me like I was from Mars. JD has been insulated from many down turns by a healthy independent dealer network. JD corporate has been crushing that dealership network into a few owners that have the supposed holy grail of "economics of scale".
What they do not give much thought to is this "economics of scale" works both ways. If a tough time like the 1980s comes along again, it is going to take massive amounts of money to keep stores open. Both dealership owners I worked for told me point blank that they had taken over $250k out of their person wealth, to keep each store open in the 1980s. Adjust that into 2018 dollars and that makes it $577K per store. Take that times 71 stores that A-Pro will now have. That comes out to just under 41 MILLION dollars. Think that Ag-pro has that kind of money laying around????? If they go broke it effects dealerships in multiple states.
Look at how Titan Equipment stock was at junk bond level just a few years ago. CNH was worried that that single entity could torpedo CNH North American.
In a lot of ways I hope JD gets smacked down by some other company. Then a bunch of corporate types get fired. Let them start over like they are forcing many JD dealership owners to do. I know a lot of single store JD dealers got hammered when they sold their stores. JD told them only this store can buy you. Then that store gave pennies on the dollar for the store. Personally I know where one dealer had his store valued by JD, at $2 million. Then two years later when JD forced him out they told him it was only worth $750,000 to the "new" chain store buyer.
The US really needs the monopoly laws applied to great segments of the corporate world in the US. Walmart and JD should be be two of the first ones smacked down. Then Bayer and foreign ownership of these corporations needs looked at hard. I know it will never happen with the best politicians money can buy in Washington. A guy can dream. LOL
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