Walco Equipment Ltd.
The only way to do business
Business View Magazine interviews Laverne Martin, CEO of Walco Equipment Ltd., as part of our focus on the Canadian farm equipment manufacturing sector.
Walco Equipment Ltd., with headquarters in Elmira, Ontario, is a distributor of short line agricultural, lawn, and garden equipment; industrial products, such as chains, hooks, overhead lifting devices, wire ropes, and other hardware; cargo control, such as heavy duty tie downs, interior straps, and products for interior vans and flatbed trucks; and tire chains for snow blowers, garden and full-size tractors, and truck and forestry equipment. The company sources equipment and products from around the world to provide quality products at competitive prices, marketed through selected dealers.
Walco has been in business since 1972 and was purchased in 1983 by its current owners, including its CEO, Laverne Martin. “It was a very small company,” Martin recounts. “We began to grow it, and move into a variety of different areas. We continued to expand our lines; we went from a straight agricultural equipment distributor to add industrial components as another market segment. One of the reasons that we diversified into the industrial is because we found, a number of years ago, that as a distributor, especially in Canada, your sales are down in the winter time. So, as one market is down, the other one helps to support you. So, that’s something that we moved into to diversify ourselves. We added warehouses – one in Randolph, Minnesota and one in St. Germain De Grantham, Quebec. We put people there, but had our products at somebody else’s facility. As we grew, we eventually built our own warehouses.”
“We are not a manufacturer in that we do not do the cut and weld onsite,” Martin continues. “We have people who do it exclusively for us. It’s our own private label and we farm it out to local small manufacturers to produce our product. On the agricultural end, we are strictly wholesalers. We only sell to dealers, and not end users. We have found, through the years that, in the agricultural business, if you sell direct to end users as a distributor, your dealers will not buy from you. When it comes to the industrial end, we sell to some of those same dealers; we also sell to OEM manufacturers, because some of those are larger buyers than your retailers.”
Regarding the competition, Martin says that Walco has an edge because it is a full-service distributor. “That means that we carry inventory, we do warranty work, and we help with financing, especially in the ag end,” he explains. “When it comes to parts, when you’re selling whole goods, you also need to be able to supply the parts when a machine breaks down. Also, we often deal with small manufacturers who need somebody on the ground in particular areas that know the market and will give full warehousing and warranty service and service for parts. That is something that, unless you are one of our very large competitors, the small manufacturers cannot do. The edge that we have is that we know our market and we give full service in that market. We serve Ontario out of our Ontario warehouse; we have a warehouse in Quebec that also services the Maritime Provinces; and we have a warehouse in Minnesota that services Minnesota, Wisconsin, the Dakotas, and northern Iowa. We do supply some of New York and a bit of Michigan out of the Ontario warehouse, but it is not what I consider a major market for us.”
While many companies, these days, sell their products online, Martin says that in the farm equipment market, at least, the old ways still persist. “One of the things I find is that you can sell on the internet, but, very often, the end user still wants to come and see the product and have it properly assembled before it comes to his place. Internet marketing has made some changes and we have to be aware of it, but on the agricultural end, there still needs to be a base to pick it up at.”
It’s one good reason why Martin believes that good relationships with his network of dealers are key to the company’s success. It also helps Walco stay on top of changes in the marketplace. “As farming methods change, some of the equipment that were huge sellers for us ten years ago, are not necessarily, today,” he notes. “One of the issues that we, as a distributor, have to keep top-of-mind is to stay on top of the changes that are out there and make sure that we have product lines that fit people’s needs.”
Another key to success are good relationships with the company’s suppliers. “Your supply line is really only as good as your suppliers,” Martin states. “You need to be a partner with them, and they need to be a partner with you. If that doesn’t work out, then, generally, the relationship doesn’t last that long. What I’ve learned through the years is that if you work with them, very often, they will work with you. And then, you can go to market together. They need us because they don’t know the market here, but we need them to give us product that we can sell. And it works much better when you have a friendly relationship with them.”
Company CFO, Albert Visscher, elaborates: “We’re willing to work with each segment to attain the goal, which is increased sales, increased profits, and being a player in the market, which is very competitive,” he declares. “But those are, hopefully, byproducts of what we would attain once we’re successful in making sure that our customers have the products they need, that they work, and that they improve what they’re trying to do. The same thing goes for our employees – that we provide stable employment for them and a good working environment. That’s been our goal all along.”
Martin sums up the Walco Equipment Ltd. ethos: “We’re a family company; we care about our employees, we care about our customers, and we care about our suppliers. I have found through the years that that is the only way I can do business.”
AT A GLANCE
WHO: Walco Equipment Ltd.
WHAT: A distributor of agricultural, lawn, and garden equipment
WHERE: Elmira, Ontario