The days of running a tab at the local farm equipment dealer have been slowly slipping away for a number of reasons - including the cost of "carrying" customers. However, a rising trend will maintain the flexibility farmers need while enhancing the service a dealer can offer.
The trend is the short-term credit program and the newest player is AGCO with the launch of AGCO Plus+ - yes that's actually AGCO Plus plus. "That was an unintended consequence of the way we named the program," admits Neal Generose, AGCO Plus+ program manager. "We get two pluses in the name, but farmers can ask for ‘AGCO Plus’."
Aside from the name, the idea of a company's credit operation providing parts and service credit may not be new, but is new for AGCO. "We tried another program with an outside partner, but the way it was set up didn't work out well for either of us," Generose explains. That program has now gone away, which gives AGCO the flexibility it needs to create this new service working with AGCO Finance.
Farmers can sign up for the service at their local dealership or at www.agcoparts.com/AGCOplus/ and use it to buy a range of parts and services including genuine AGCO parts, accessories including radios, AG-Cam units, high-intensity LED lighting and more. And the program allows you to "charge" the parts or service at any AGCO dealer, not just your "home" store, which can help in a crunch if a part you need is available at another location.
Why a credit service?
The idea of this kind of service isn't new, and Generose agrees that AGCO is the newest player, but notes this is focused on AGCO dealers and will provide customers special deals and offers tailored to the brand. "For example, right now we're offering two months interest free for $500 in charges, three months free for $1,000 and four months interest free for $2,000 in charges on AGCO parts," he says. "And we'll offer different specials in the future too."
Dealers have moved to these kinds of services in the past so that their accounts receivables move off the books to an outside provider. That frees up needed cash for the dealer, and helps with dealer financial strength. Trouble is the providers aren't AGCO focused and the company sees an opportunity here to better serve its dealer base.
Interest rate for any balance you carry is Prime-plus 10.9%. And while there is a "membership card" for the service, you don't need it to charge to that account at the dealer. Nor does anyone who might go in to pick up parts for your business - it's a handy feature.
The program has been rolling out slowly since October, but is hitting its national "stride" in June. Farmers will hear more about it from their AGCO dealers throughout the summer. You can learn by visiting www.agcoparts.com/AGCOplus/