On the Fence About Fencing?

Fencing can be difficult to sell because of a ‘price-match’ competition with big box stores. Expert knowledge can help you win long-term customers.

Cat Poland, Contributing Writer

Some equipment dealerships are seeing an increase in fencing demand as farms are being split up and sold, and rural lifestylers are setting up homesteads on smaller pieces of acreage. Despite the demand, this product isn’t found in every dealership, or even many dealerships, and for good reason: Price. It’s often difficult, if not impossible, for dealerships to compete with big box stores. However, some dealerships have found success with this niche product in spite of the “price-match” mentality.

More Neighbors Make More Fences

Burnips Equipment Co. has 4 locations in western Michigan and serves a wide variety of customers from large equipment buyers to rural lifestylers. They’ve been a family-run business since 1972, but are relatively new as a fencing provider.

“If you’re looking at rural customers, you’ll see two different things. While large-scale farmers are tearing down fences to plant more crops, rural lifestylers, or those doing small-scale farming or agriculture operations, are eager to put more fences up,” says Gail Vanderkolk, Burnips sales manager. “We’re seeing a lot of farms being split up and sold to make smaller homesteads, meaning people have more neighbors than before.”

“We’ve always carried electric fencing and deer fencing, but just started getting into field and equine fencing. We’re getting our toes wet on that now, and can already tell that high tensile fence seems to be most popular in this area,” Vanderkolk says. Burnips doesn’t supply the high tensile wire, which is mainly used for cattle in the area. However, they do carry the insulators and accessories needed to install the product.

So what prompted this addition to their product lineup?

“While we began as a regular farm equipment dealer, we bought out a full-service hardware store, so we’re a little more diverse. Our remote locations mean that we want to be a go-to resource for all the things farmers or rural lifestylers might need.”

This extra attention to customer needs has served Burnips well. They’ve already received positive feedback from their customers about the additional fencing products and the ability to buy fencing locally. Customers are also pleased that they carry the Dare line of fencing products (barbed wire, field wire, netting, etc.), which is manufactured in their own backyard in Michigan.

Burnips is confident this was a move in the right direction, but they are also concerned about the competition. Some shoppers will drive greater distances, seeking lower prices at the bigger chain stores, or simply bring in the competitor’s sales flyers in hopes of receiving the same deals at Burnips.

“We get a lot of requests to price match the big box stores on a year-round basis, while they’re only promoting these prices for a short time frame. While we’re happy to do it during the time-frame of the sale, we’d have to cut down below our cost to do it year-round. And it’s also a matter of not comparing apples to apples. Typically, the products they offer during these deep discounts are of a lower quality, meaning customers don’t always understand why our prices might be higher on what they perceive to be a similar product. It’s a matter of education,” Vanderkolk says.

Education appears to be an important element when it comes to successfully selling fencing products to rural lifestylers. They often need instruction on which products are best to use, which brands will provide the best quality, and which equipment will best meet their installation needs.

“Our main concern is carrying quality products, to give our customers the best value,” says Vanderkolk. “For example, that’s why we carry Tarter and Priefert gates. We only want our customers to have the best.”

Stay Flexible, Knowledgeable

Dealer Takeaways

• Be prepared to combat price shoppers with a personable, expert sales staff who can educate customers on fence quality and help determine their needs.

• Customers turn to the Internet to generate ideas and your dealership needs to be aware of trends. For example, while high tensile may not be selling well now, it is becoming more popular.

•Be aware of economic trends and other opportunities. An oil boom or a renewed interest in gardening, livestock for personal use, or even hobby animals (horses, goats, etc.), may increase product demand.

When it comes to fencing, Cleaver Farm & Home in Chanute, Kan., probably carries it. From Red Brand, they carry barbed wire, staples, woven wire, panels, specialty hardware cloths and poultry nettings, among other accessories. Their Oklahoma brand line features barbed wire, panels, fence stays and woven wire, and they also stock Davis barbed wire. Their fence post selection includes products from Commercial Metals Co. (which also uses the name Sheffield) and Chicago Heights. For gates, they stock B&W and Hutchinson Western. They even have some treated round fence posts in stock and can special order creosote posts.

“You need to have a variety of products, not just what you thought of in the past. You need to be open to change and new product lines. People look stuff up online and see something new and fresh. You need to be familiar with these products,” says Chris Cleaver, president.

Cleaver Farm & Home is no stranger to keeping up with customer needs and demands. It was founded as a livestock and scrap metal company in 1946 and has evolved into a one-stop shopping experience for building, home and farm needs. Their willingness to adapt to the times isn’t the only reason Cleaver’s has done well with fence sales.

To better serve rural lifestylers in remote areas, Burnips Equipment in western Michigan started carrying a comprehensive line of fencing products and accessories.

“Sales are going very well; it’s been a good year. When farmers have a decent year of crops, it seems to lift all economic tides around here,” says Cleaver. “We’re seeing a growing trend in hobby farmers in our area. We’re selling more and more sheep and goat wire. Those livestock markets are going up. Fence for those guys is as important as or even more important than it is for those with large heads of cattle. There’s less space, less head, and these customers are counting on each one.”

Another local development is also fueling the increase in fence sales for Cleaver Farm & Home. Its area in southeast Kansas has seen an increase in out-of-state deer and wildlife hunters leasing land, so deer and wildlife fencing is very popular. Cleaver’s carries Red Brand deer and wildlife fencing, as well as sheep fencing for landowners to contain the wildlife they’re raising.

Always Provide Exceptional Service

Oil Boom Brings Fencing Business

Dealers should keep local economic trends in mind, especially when they can’t compete on price for fencing. The common sentiment may be that rural lifestylers go to big box stores for fencing supplies, but there may be opportunities for dealers to serve their needs better.

“The only way to be a competitive fence provider is price, price and price, unless price isn’t a factor.” These are the sentiments of Steve Schroeder of Stillwater Milling. The company has 4 locations across north central Oklahoma. Stillwater Milling has seen an increase in fence purchases due to a local economic trend: the oil boom.

“We’ve seen a lot of landowners come in to replace the fencing that the oil companies tore up when they placed their wells. The oil companies are paying to replace the fence, so the customers aren’t as concerned about price as they might normally be.”

Scruggs Farm & Home, serving the Tupelo, Miss. area, has found that customer service has helped them increase fencing revenues. Founded in 1973, Scruggs’ early products were farm chemicals, feed, fertilizer, farm equipment and parts, and many items for lawn and garden. In 1990, they added the John Deere line of products under a separate business name, Coley Implements. And in 2005, they moved everything under one roof and one company name to better serve customers, while also adding fencing to their product lineup.

Jennifer Shadburn, department manager with Scruggs, has been assisting rural lifestylers with their fence purchases for more than 8 years.

“From day one, we have seen substantial growth. Our fencing product line has more than doubled in 8 years, and we’re seeing it grow every year,” says Shadburn. “The downshift in the economy has actually meant an increase in business for us. When the price of food shot up, people with a few acres started buying cattle and swine for meat, and even people who live in the middle of the city started buying 4 or 5 chickens for eggs. People need a way to contain these animals.”

The economy hasn’t been the only reason Scruggs has seen fencing sales soar in its area.

“Most rural lifestylers who come in don’t necessarily know as much as they’d like about fencing. They’re not sure where to start. I help them figure out their needs. I’m personable and spend lots of time with the customer. I’ve had many customers come here because the big box store didn’t know enough about the product,” she says.

With knowledgeable, helpful salespeople on the floor like Shadburn, Scruggs has been able to compete in an area where the big box stores sometimes can’t: service.

She also says Scruggs’ customers are buying mostly practical items, like barbed wire and field fence. Scruggs carries Oklahoma and Red Brand barbed wire and field fencing, and Gallagher, Fi-Shock and Patriot electric fencing and supplies, in addition to the line of Tarter gates.

“Most of the people around here are doing 5 or 10 acres. In this economy, they’re looking for the cheapest, easiest and best way to contain their livestock. It really varies from customer to customer, though, based on what type of area they’re in and what kind of livestock they have.”

Don’t Let Price Competition Deter You

Shadburn knows service and quality products come first, but she battles a “price-match” mindset from customers from time to time. But she doesn’t let this deter her.

“People want to price match, and we do what we can, but some are just out of reach. And it’s important to educate customers that they may not be comparing apples to apples. Often, the other product is inferior, so, of course, the price will be less.”

Large orders helps Cleaver Farm & Home, Chanute, Kan., offer competitive pricing. They’re also flexible enough to order small shipments of specialty items.

For example, if a competitor lists its T-posts at $3.99, and Scruggs is $4.99, customers may be confused. But once she explains that Scruggs offers a heavier stock and higher quality, most customers are accepting.

“Don’t let price competition deter you,” Shadburn says. “When you keep your customers happy, they come back again and again. Take care of their needs, and they’ll be return shoppers.”

So how does Scruggs find these customers in the first place? In addition to traditional marketing avenues, such as TV and newspaper advertising, they also take a more non-traditional route. “We’ve found great success with sponsoring cattlemen’s meetings in local surrounding counties. Hobby farmers (or rural lifestylers) are around 80% of our market base here, so we want to be where they are,” says Shadburn.

Keys to Success

Only you can determine if adding fencing to your product lineup is advisable in your particular area, but it’s helpful to know that some dealerships are making it work.

Keys to success include responding to increases or changes in rural lifestyler demand, remaining knowledgeable yet flexible about new products and providing exceptional customer service. These strategies are just some of the ways your dealership can overcome the price-match mentality that many rural lifestyle customers have about fencing products.