OK, I know it’s not strictly an aglaw issue, but I just had comment on the saga that continues to be the Elders story…….
Elders was my first employer upon leaving uni, so I still have a great deal of affection for the company and the start they gave me, and I worry when I read commentator’s remarks speculating that it could be on the verge of death (See David Leyonhjelm’s blog in Business Spectator here). Everyone has been reading about their lastest profit forecast (or lack thereof) and the problems currently plaguing the company moneywise, so I wont rehash that.
What has bothered me though in the past couple of days, is CEO’s Malcolm Jackman’s willingness to partially blame farmers for its current state of affairs. Elders stated yesterday that “the downgrade was partly attributable to farmers shifting from the company’s premium branded products to cheaper generic alternatives”. This portrays to the average reader or listener, who may not have had a great deal to do with agribusiness, that all of a sudden the rural chemical market has changed and that farmers have made the quick decision, in the space of 12 months, to start supporting generic product. Ahem, but generic product has been around for years, and farmers have been buying these products for years, decades even. It is not a fair to publicly blame farmers for the poor performance of the company when the likes of Landmark, RuralCo and others have been performing satisfactorily, quite well even, in the same market that Elders operates in. So what’s going on?
I don’t claim to have all the answers, far from it. It is certainly a complex and complicated situation. I would however, make the comment, that agribusiness in particular, is a business based on relationships. This could probably be more important in this sector than any other, and in my opinion, this is partly the reason why Elders continues to struggle in the market.
Over two years ago now, a media release was issued by the Australian Council of Deans of Agriculture about the chronic shortage of good people coming through the ranks within universities and colleges that offer courses in agricultural science, economics and agribusiness. Recent opinion pieces on the current state of Elders have indicated that this is a significant part of the problem. That is, there are simply not enough good, educated people on the ground to be able to service clients in a way that is needed. Many have left, and the ones that are still there are too few, and too under resourced. These people add value to the products and services supplied to farmers and enable a company to minimise its exposure to the effects of generic markets. And now, the company looks set to cut even more jobs?
This is a problem that is not only going to affect Elders, but is going to affect many agribusinesses over the coming years. This industry, with the challenges facing it at the current time and predicted challenges in the future, needs good people. Agribusiness is a fantastic industry to be a part of, and we collectively need to promote it to the wider community as a not just a viable career option, but a great one.
It would be a massive blow to the agribusiness and farming communities to lose a famous Australian icon such as Elders. One can only hope that their strategy for turning around their performance works, and that the season is kind to enable them to get back on their feet and deliver to shareholders once more.
