Kline’s latest agrochemicals report is providing consensus from distributors on program likes, dislikes, and suggestions for the future.
According to the just-published Effectiveness of U.S. Crop Protection Company Channel Incentives, programs and suppliers that are consistent and those that responded quickly and positively to shortages in general earned high marks with distributors. Those interviewed also noted some leading suppliers struggled with shortages in 2021, but many have made improvements in 2022. In addition, some programs were noted as too specific and centered on only one or two brands within a suppliers’ portfolio.
There is some consensus on program attributes distributors like, including when grower programs are coordinated through the channel versus direct with growers, simplified programs, and protection of large price adjustments with channel partners.
Factors that were mentioned as dislikes with programs include hidden rebate programs, the complexity of programs, and payouts tied to “product bundles.”
Other observations and suggestions from distributors include more success when suppliers send more experienced account managers to call on distributor organizations; meanwhile, distributors say technical and marketing support would be appreciated to help them position products for end users.
“The changes in the marketplace have also significantly impacted incentive programs that agricultural chemical suppliers have been able to offer distributors, retailers, and growers in 2021 and 2022,” says Laura Mahecha, director of our Agrochemicals sector. “While it can be overwhelming to stay abreast of the sheer volume of products and variety of incentive programs currently being offered, our report helps save our clients time by synthesizing important information on these programs.”
Effectiveness of U.S. Crop Protection Company Channel Incentives provides a ranking of the top 10 agricultural chemical suppliers based on client input; a full assessment of 2021 incentive programs offered; and highlights of select products in 2022 with significant changes in price, supply, or programs. The report is a good source of intelligence about programs with a summary of incentives to distributors, retailers and growers by product plus a summary of potential payouts by six research, two mid-major, and two generic companies. Each product includes distributor list price, potential programs by group and net price. It also gives distributor management feedback on how each of the suppliers were ranked on their effectives, likes and dislikes and suggestions for future programs.
Our related recently published report Leading Distributors in the U.S. Crop Protection Industry: A Strategic Market Analysis analyzes leading national and regional distributors, larger cooperatives, and buying groups that total 94% of crop protection manufacturer net sales. This study provides detailed profiles of the top 17 distributors, merger and acquisition activity among agricultural retailers, strategic partnerships with ag retailers among distributors, and the role ag retailers play among suppliers and growers.
Kline is currently accepting charter subscriptions for the new editions of both of these studies to be published in 2023. For more information on these reports and how Kline’s Agrochemicals practice can help inform your business decisions, contact us.