Heritage Tractor, a regional John Deere dealer, sells preowned John Deere tractors, mowers and agricultural equipment domestically and internationally. From an international perspective, it focuses on exporting used harvesting and combine equipment to receptive countries including Ukraine, Canada, Mexico, China and several South American countries.
Kurt Miller is the company’s Used Equipment Manager with a particular focus on its international sales. “In terms of dollar sales, I’d say that Mexico and China are our biggest export markets at this time,” said Mr. Miller. “We’ve been selling in Ukraine for awhile, but the war has slowed sales there despite the fact that they are always on the lookout for good used equipment at the right price.”
According to Mr. Miller, he expects that export sales this year will surpass $1 million and range from $1.5 to 2 million dollars. The company does not export any parts.
“Our greatest obstacles to more exports sales are the war in Ukraine, pricing it right and freight costs,” he explained. “The war aside, if we can handle pricing and freight, we are generally successful.”
Freight costs for its equipment are an obvious consideration for its international buyers. While shipping its equipment to Mexico is not so much of a concern, offshore shipping costs are critical for international sales acceptance.
Due to the size of its agricultural equipment, it must ship by sea as break bulk, which of course, affects shipping costs.
“The only other aspect of exporting that holds us up is documentation compliance,” said Mr. Miller. “We have been working with the Kansas City office of the U.S. Commercial Service (USCS) since the beginning, and they helped keep us on track with our compliance issues.” After some time, Heritage decided to hire a consultant in Iowa to manage the compliance aspects of selling internationally.
According to USCS Kansas City’s Pinki Thakker, they have been working with Heritage Tractor since 2020. It began with Mr. Miller meeting with them to obtain export support through its network of Commercial Service colleagues to help establish long-term international partnerships.
The USCS initiated research through the Rural America’s Intelligence Service for Exporters (RAISE), which provided market data to identify the top export markets for used agricultural equipment. The USCS then used this matrix of data to poll the top 10 markets through its overseas network, and further refined it to a top three market selection and conducted an agricultural equipment International Partner Search on behalf of Heritage Tractor.
Through the USCS overseas network of in-country colleagues, they identified opportunities in Ukraine, Nigeria and Uruguay with both distributors and end-users. The USCS also recommended the engagement of an international law firm to draw up appropriate distributor contracts.
The USCS then introduced Heritage Tractor to the EXIM Bank to learn about export credit insurance.
And through the USCS network of agricultural specialists in international markets, they are able to identify additional sales leads, such as recent agricultural equipment sales lead in Thailand.
“We really relied on the Kansas City office of the USCS to get us up and running for extended international sales,” stated Mr. Miller.
The company works with its offshore customers as they truck its agricultural equipment to the port of choice for ocean vessel shipping.
“Because we only export intact used equipment, we really don’t have any supply chain issues,” he continued. “Most of our sales are direct to the customer, although we occasionally use distributers as needed.”
Because the John Deere name is so well recognized worldwide, its used agricultural equipment export customers often seek Heritage Tractor equipment for the best deals.
For more information about Heritage Tractor, go to www.heritagetractor.com.