‘Digital Ecosystem’ Enables Online Buying of Seed

by | May 10, 2021 | Features, Industry News

Photo: Gerd Altmann from Pixabay

Agro.Club is finding acceptance among seed sellers, but experts says it’s crucial to ensure the platform doesn’t become a price comparison tool.

Winnipeg, Man.-based Canterra Seeds is the first seed company to join what’s being dubbed a “digital ecosystem” which promises to transform the way the Canadian agriculture industry buys, sells and earns.

Agro.Club, a United States-based startup, has established a new Canadian company — Agro.Club Canada. Drawing on the company’s origins in the Black Sea market with over 10,000 farmers using the platform, the Canadian company says it’s committed to creating efficient, inclusive technology solutions for the value chain.

“We want to give the whole industry a more efficient way of doing business digitally,” says Neil Arbuckle, the managing director of Agro.Club Canada. 

Arbuckle has over 30 years of ag business leadership, working across the Canadian value chain. Prior to joining Agro.Club, he served as director of commercial operations for Bayer’s Crop Science division and was national sales lead for Monsanto before that. 

For Arbuckle, building an online ecosystem which includes all the existing partnerships and trusted relationships is key to helping the Canadian ag industry take a digital step forward.

In June 2020, Agro.Club first announced plans to expand into Europe and launch operations in North America following the closure of a $1.5-million seed round led by Speedinvest, with participation from Elevator Ventures, the corporate venture arm of Raiffeisen Bank International. Previously, Agro.Club had a successful launch in Russia, a $20-billion market, where almost 20 per cent of farmers have signed up in the first 18 months and with millions of dollars in monthly business, according to the company.

Via its free platform, which includes a website and telephone ordering service, Agro.Club bills itself as a single place to order inputs from a retailer of choice.

“Farmers have historically been the risk-takers working in a non-transparent market. The Agro.Club mobile app empowers farmers by giving them access to multinational giants, independent manufacturers, trusted retailers, grain exporters and food companies,” the company says in a news release. 

“This opens up new opportunities for players of all sizes, while providing a closer relationship with farmers and platform support across the whole value chain, from seed to grain at the port.”

Looking for Industry Acceptance

The Agro.Club Canada announcement comes two years after Farmers Business Network (FBN) announced its move to Canada, setting up a head office in High River, Alta., and announcing its acquisition of Yorkton Distributors in Saskatchewan — the beginning of what it said would be a distribution network across the West.

FBN allows farmers to anonymously share precision ag data including seed performance, as well as information on what they’re paying for seed and crop protection products. Farmers can also purchase inputs directly online from FBN and its partners.

FBN Canada’s approach to doing business on the seed side is a little different than its U.S. counterpart, however. In the U.S., an individual seed variety can be sold under multiple brand names by different retailers at different price points, and FBN’s data will reveal which seed products from which brands are genetically identical, and at what prices they’re being sold for.

Because Canada’s seed system forbids multiple suppliers from selling the same variety of seed, FBN Canada has instead focused on performance and price analytics.

According to Arbuckle, Agro.Club Canada enables farmers to place orders online for the products of its manufacturer partners. Farmers then select their preferred retailer. Price is negotiated locally, and once a deal is reached, product is delivered and supported by the retailer of the farmer’s choice.

“Online sales in the seed world are relatively new. The problem is designing the system. A supplier can build it themselves, but it’s not their area of expertise. They could contract it out to a third party, but that’s expensive. Or they can do nothing and watch the world go by, which most people understand isn’t really an option for their business,” Arbuckle says.

“Agro.Club gets them digitally enabled in a cost-effective way as this digital ag revolution we’re seeing all over the world takes place.”

Curt Baldwin, director of the Canterra Seeds canola, corn and soybean business unit, says being the first seed company to sign on to the platform made sense because it puts an emphasis on relationships between the grower and retailer, something lacking under other online sales models.

“We know retailers deliver local expertise and have a unique understanding of the customer’s needs, which ensures our products perform on their farm. It was important for us to embrace that and bring it online,” Baldwin explains.

“Rewards programs are a huge part of what we do as well. An early order allows us to plan our supply chain so we can have the right seed with the right treatment available at the right time, and a platform like this allows us to bring that concept online as well.”

Changing Behaviour

Justin Funk, managing partner at Agri Studies in Guelph, Ont. says a platform like Agro.Club is just the latest in a shift to online sales which will likely become more pronounced as time goes on. A major area of interest for Funk is looking at future marketing trends in agri-retail.

The industry has been talking about online buying and direct selling for years, Funk notes. He says there’s often a slow adoption of new ideas in the retail world and among farmers. The speed at which an idea is adopted can be affected by that idea’s compatibility with current thinking, complexity of the idea, skepticism revolving around that idea and how quickly early adopters are able to observe results.

From recent research Agri Studies has carried out in partnership with Purdue University on the purchasing habits of multi-generation farms, one thing is clear — buying online is becoming more popular.

“Every bit of evidence we have suggests a segment of the market wants to buy online. Contrary to popular belief, it’s not always the younger farmer than wants to do that,” Funk says.

However, unlike other industries where physical retailers have been virtually replaced by online retailers, Funk says agriculture is still very much people-oriented and will remain so.

“As long as we have people in the field and there are bricks and mortar retailers, I think online ordering is going to be around but not heavily adopted to the point where it eliminates physical retail outlets. The human interaction part is going to be crucial next year and 10 years from now.”

But he emphasizes that being tech-savvy goes beyond just basic computer literacy and offering online shopping. Retailers perceived as truly tech-savvy use all aspects of technology to make decisions when it comes to farming — from equipment technology, precision agriculture techniques, soil sampling and biotechology.

“I’m a fan of letting people do things they’re really good at doing. If your expertise is not in designing e-commerce systems, maybe it’s not something you should be doing. If your strength is providing agronomic recommendations, you should focus on that. If you can farm out the online platform piece to someone really good at that, then that’s going to enhance the customer experience,” he says.

However, he cautions it’s crucial online platforms like Agro.Club don’t become price-shopping tools.

“We can’t let online buying get in the way of relationships. Retailers can’t become complacent thinking this replaces their role — it doesn’t. It’s another tool in the toolbox to offer a better customer experience,” Funk adds.

For Baldwin, online buying platforms like Agro.Club will help businesses like Canterra Seeds, rather than hinder them.

“There is going to be a huge amount of change in the next five years and to have a partner to help us grow in this space is great. It’s complementary to our current business model — it doesn’t alter it.”

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