VIEW FROM THE TOP
BAYER CREATES "BRICKS AND CLICKS" STRATEGY WITH RETAILERS
Editor's Note: Jim DeLong is head of sales and e-solutions for Bayer Corporation and has been instrumental in the development and implementation of BayerValue.com, the new business-to-business e-commerce platform for the Agricultural Division of Bayer that launches this month. In addition, DeLong provides e-business support to the worldwide Crop Protection business group of Bayer. Previously, DeLong was president and CEO of Wilfarm LLC.
AM: Tell us about BayerValue.com.
JD: BayerValue.com is an innovative business strategy to help our customers - agricultural retailers - remain profitable in an ever increasingly complex and competitive crop protection marketplace. It also helps retailers have greater real-time access to inventory, sales, financial data and other business management tools.
In many ways, BayerValue.com marries the strengths of the traditional distribution channel; the relationships, service and knowledge of the local retailer; and the speed and efficiency of the Internet to order, track and ship products. Our goal is to sign on 1,500 retailers, primarily in the 14 Midwestern and Pacific Northwestern states, during the first year.
There are other aspects of BayerValue.com that benefit the industry. This includes the use of RAPID bar coding and NAPD grower ID numbers for product tracking; retained Bayer ownership of product, which frees up retailer capital; and uniform grower pricing. In the future, there will be grower Internet portals that will help drive interested growers to their local dealers for product information and sales.
AM: How will BayerValue.com be different from the numerous direct buying or auction-type sites that already exist?
JD: BayerValue.com is different because it is designed to support the efforts of the local retailer in selling and servicing Bayer products to their customer, the grower. We will not sell direct to growers. We believe the distributor and retailer are critical and essential links in providing growers with both products and services they need to be productive and successful.
Most other Web-based e-commerce sites are for direct selling of seeds, equipment and crop protection products to growers. They bypass traditional channels and retailers. This devalues the products, and reduces channel profitability and the services that local retailers provide. If this continues, it will damage the critical infrastructure that growers must have to continue to be the most productive suppliers of food and fiber in the world.
AM: What has the response been from distributors and retailers?
JD: Since we announced BayerValue.com back in June, the response and signup in the program by retailers has been better than expected. Most retailers have Internet access and see the efficiencies of doing business over the Internet, which gives them more time to provide more customer sales and service.
We know that most growers, given similar prices and choices for products, would prefer to buy locally, even though they may use the Internet for product and pricing information. Retailers say that BayerValue.com helps provide them with a more equal playing field. At the same time, it maintains profitability and helps reduce the under-selling that has plagued the industry.
AM: What percentage of farm commerce will be conducted electronically by the year 2005?
JD: I would dare say that the majority of farm commerce will be conducted, either in whole or in part, via the Internet or other electronic means by 2005. The technology certainly exists to make it so for agriculture, which has lagged behind the consumer markets. Just look at how much consumer commerce is being conducted electronically today. Agriculture has to take advantage of those technologies to become even more efficient, productive and profitable.
AM: Can e-commerce play a positive role and have a significant effect on a farmer's pocketbook?
JD: Absolutely. But the benefits of e-commerce extend way beyond a farmer's pocketbook to making them more efficient, saving them time, and accessing new markets for what they produce. Just as we view BayerValue.com as a way to ensure market access for our products, growers should view the Internet and e-commerce as one tool to help make them more efficient and profitable.
In many rural areas, ag retailers are critical and essential to the farmers that they serve. Helping retailers remain successful during tough times directly impacts the local ag economy and it ensures that farmers have a close and stable place to conduct business well into the future. AM