Blain’s Farm and Fleet – Case Study

Located in the across four states, Blain’s Farm and Fleet is family owned and operated general store that serves those living in the rural and farming communities. Their product offering spans everything from agricultural supplies to kitchen appliances. They also offer an array of services including small engine repair, drive through pick-up, rewards program, and the Blain’s Mastercard. These products and services come together to provide Blain’s Farm and Fleet’s customers with convenience and service that is deeply rooted in Midwestern culture and lifestyle.

History of Blain’s Farm and Fleet

Blain’s Farm and Fleet was started by brothers William Claude Blain and Norman Albert ‘Bert’ Blain in 1955 in Janesville, Wisconsin. During this time, it was against the law for stores to sell discounted goods to anyone other than businesses. The brothers wanted to serve their community by providing quality products at fair prices; they found a loophole in the legislation where anyone who owned five or more engines was considered a fleet, and thus a business. This allowed them to open a discount store to serve their customers, since farmers typically had more than five engines.

Today, the company operates 42 stores and an ecommerce website. Each store carries over 150,000 items that range from agricultural supplies to lifestyle products. They evolve their services to meet the changing needs of their customers and remain heavily engaged in the community through their scholarship program, local events, and pet adoption programs.

The Farm Supply Stores Industry

Over the past five years, the Farm Supply Store industry in the US has grown at an annual rate of 4.5% to $17 billion. Nondiscretionary goods, such as livestock supplies, drive most of the stable revenue that the industry produces annually. Other drivers for growth include the increase in consumers’ disposable income, rising crop prices, and access to credit. Customers have been taking out lines of credit and or loans for home improvement projects and equipment upgrades, adding to overall industry spending while improving productivity on their farms.

The industry is forecasted to grow at 1.9% annually to $18.7 billion by 2024. Future drivers of growth include continued increase in agriculture prices and global demand in biofuels and food. Consumers are also expected to continuing borrowing to fund home improvement projects, despite possible interest rate increases. Given the positive prospects of the industry as well as increase in profit margins, new entrants are expected to enter the market.

Customers and competitors

The Farm Supply Store industry’s competitive landscape has changed over the past decade. Previously mid-size chains and single-location stores were the types of businesses that served the rural farmer demographic. However, mass retailers, such as Walmart and Home Depot, have opened stores in and around these communities, offering customers more options and lower prices. Also, ecommerce giants, like Amazon, have also emerged providing customers convenience of online orders and direct to door shipment. These new entrants increase the competitive pressures within the industry.

Blain’s Farm and Fleet’s direct competitors include Rural King and Tractor Supply Company, as well as previously family-friend owned Fleet Farm. The industry is broken up evenly between major players and minor players, with Tractor Supply Company being the largest with 49.7% of the market share concentration.
As increase in profit margins continues to encourage new entrants into the industry, existing companies will be driven to compete on price and customer service. Existing farm supply stores will need to leverage their existing relationships with their customers by developing unique services that cater directly to their lifestyles.

Blain’s Farm and Fleet Success Factors

One of Blain’s Farm and Fleet’s major success factors is the fact that they are a family owned and operated business with strong roots in the farming community. As a family owned company, there are no shareholders that management needs to answer to, allowing them to focus solely on building the business around their customers. This is particularly important to the rural and farming demographic as relationships play an imperative role in the social fabric of their communities.

Another success factor is the strong culture within the organization that allowed the business to transition from the original founders to current owner, Jane Blain Gilbertson. Changes in leadership will always bring uncertainty within an organization, and it was no different when both the original founders passed away. The employees who embodied the spirit of the organization provided continuity during the turbulent times, offering reliability and consistency for the incoming leaders, partner vendors, and customers. This provided for stability, which allowed the company to continue on to grow the business while minimizing disruptions.

Blain’s Farm and Fleet – Looking Ahead

Given the increase in retailers and threat of Amazon, Blain’s Farm and Fleet will need to focus on building loyalty with their customer base. The company should leverage their ability to understand their customers to develop services that specifically cater to their needs. At the same time, they will need to also continue to develop services that are ubiquitously available to the masses. This will allow them to compete with mass retailers on a value of convenience when they are unable to compete on price.

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