Guest Spot: Apex Farmers

11 October 2017

Why have buying groups become more popular with farmers?

Keith Thomas, agricultural consultant and secretary for Apex Farmers’ Co-operative, explores the benefits of group purchasing.

Over the past 26 years, Apex farming co-operative in Wiltshire has grown from five to its optimum operating membership of 25 members, and we now purchase more than 30 commodities and services – reducing our members’ outgoings by up to 20%.

The ethos behind our co-operative is simple, through competitive purchasing via tenders backed by strong administration and financial controls will deliver value for both farmer and the supplier.

Members are divided into small groups, with each group focusing on three-four different aspects of farming; feed, fuel, machinery etc. Their role is to research and compare the required products or services within the marketplace before drawing up a shortlist of the best companies to tender. They then oversee the tender process and make a recommendation to a full APEX committee on the tender they believe should be accepted.

Advantages of being part of a co-operative group

To provide the best value for members; which isn’t necessarily the cheapest. Co-operative groups want to ensure the longevity of products for their farmers, and that often means products which come at competitive prices. Discounts to a group will always be far greater than discounts to an individual, so buying collectively is an easy and efficient way to reduce outgoings. Purchasing in this way also increases an individual’s buying power.

By taking care of all the researching, comparing, and searching for the best product at the most reasonable price, buying groups also save farmers time. Time which can be better spent earning their living instead of spending it!

Suppliers too can reap the benefits of working with a co-operative. Not only is there an extra level of comfort to be gained from dealing with customers who display positive financial management skills, but selling to a collective also reduces their transaction costs. Selling to numerous purchasers under the guise of one buyer means fewer transactions but more customers. It’s therefore easy to see the rewards of working with a group as opposed to an individual.

Administration is key to delivering value to the supplier through streamlining their sales process. Farming can also be an incredibly isolating industry. Becoming part of a group that shares similar ideas and values is a fantastic way to combat this. Co-operatives can work together for both the individual and the greater good. This not only creates a sense of camaraderie, but also enables members to make sensible purchasing decisions through sharing knowledge and experience of products or services.

For more information please email Keith at keith.thomas@kmtconsult.co.uk or Sally Warner at admin@apexcooperative.com.

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