Story sponsored by Agricultural Equipment Holdings (AEH).
If you talk to most farmers, they'll tell you there is one word that strikes fear in them more than any other: Drought.
It's a tough time. It requires them to rethink their business model, diversify their operation, and come together with others to collectively get through it.
The same is true of small agricultural businesses. Few know this better than Agricultural Equipment Holdings (AEH) Central NSW's Managing Director David Thompson.
After purchasing McPherson Parts and Service in Parkes from his father Barry and one of his business partners in 2014, the young entrepreneur set about diversifying the family's operation so they would be better protected next time drought struck.
McPhersons was predominantly involved in broad acre farming and therefore at the mercy of the gods. When the season was good, they were flush. When it was bad, they were bust.
Six years later, he now oversees a conglomerate which includes six different small agricultural business, whose combined resources helped protect the jobs of more than 80 people during this latest dry spell.
"We've just come through one of the hardest droughts on record and if we'd just had a broad acre dealership, it would've been very hard to keep the doors open," Mr Thompson explained.
"To be honest, I think it would've been hard for any of our individual businesses to survive on their own... but because we've now got branches in towns with irrigation and in a drought people need hay, so, it paid off for us," he continued.
"It also allowed us to be there not just for our employees and their families but also for our customers, so we could support them during a time when they really needed it."
Mr Thompson and his wife Renee first had the idea for expansion long before they had the means of making it a reality.
Not long after they purchased McPherson Parts and Services, the couple began looking around for other businesses to invest in. They came across Forbes Machinery Centre and Cowra Machinery Centre.
The couple approached the owners and chatted to them about the idea of a sale. Both were open to the proposal. The seed, at least, had been planted.
Around the same time Mr Thompson, who had worked at McPhersons since 1986 and had a long standing relationship with New Holland, mentioned to some of their team that he was looking to diversify.
As fate would have it, at roughly the same time, another entrepreneur Adam Kaplan, also spoke to some of their team about potential investment opportunities.
Mr Kaplan owned a number of automotive dealerships in Sydney but was keen to expand into ag. When one of the staffers put the pair in touch they were both impressed with one another.
Thanks to an equity partnership, the newly formed AEH purchased the branches in both Cowra and Forbes.
In the years that followed they also purchased Temora Truck and Tractor as well as West Wylong Machinery Centre. This year, AEH also acquired South West Tractors in Young.
While the six branches now operate under the same umbrella, each is successful, Mr Thompson says, because they have managed to maintain their autonomy and community roots.
All of the branches retained their traditional names. They're all staffed by locals. And, perhaps most importantly, they have continued to support the communities that support them.
"It's very important for us to stay local.... All of our dealerships were long standing and established businesses when we purchased them and all of their staff were retained. Nobody was forced to reapply for their jobs," Mr Thompson explained
"There have also been opportunities for staff within those branches to develop and advance. For example, somebody who was a sales manager, is now a branch manager," he continued.
"As the business has grown over the last few years, we have employed additional staff and we're currently recruiting at the moment."
AEH works closely with the Careers Advisors at each of the local high schools in the communities in which they operate, to help give employment and training opportunities to young people.
With the influx of GPS and digital technologies in agricultural equipment, young tech-savvy employees will be essential in the future, they believe.
AEH also sponsors an array of local sporting teams; local show societies; primary schools and high schools; community events; and kids sports. They're very a family orientated business.
While Mr Thompson oversees all of the operations, he has a philosophe of letting each branch run as efficiently as it can.
Each manager has their own style, each branch its own culture, they all have a way of doing things. When things work well, there's no point interfering.
If anything, Mr Thompson says, AEH has allowed each business to become more efficient because it has allowed them to pool their resources and draw on each other's experience and skillset.
Not only has has it increased their opportunity with sharing inventory, they're able to help each other out and add value for their customers. Collectively, their team has hundreds of years experience between them.
Customer service is everything to them. It is the primary reason AEH Central NSW has been so successful.
In fact, they've been so successful that this year, Forbes Machinery Centre was named New Holland Dealer of the Year.
In addition Mr Kaplan has replicated their business model to establish a second AEH operation in Tasmania and has further plans to expand into other Australian states to provide farming solutions across our country areas.
Story sponsored by Agricultural Equipment Holdings.
The story Agricultural businesses band together through tough seasons first appeared on The Land.