the northeast dealer - december edition

DEALERNortheast

The Newsletter of NoRThEAsT EquipmENT DEALERs AssociATioN, iNc.december 2015 c Vol. 17, No. 201www.ne-equip.com

Josh AheArnnamed northeast equipment Dealer

Association President for 2016Josh Ahearn is co-owner and Vice President of Ahearn Equipment, located in Spencer, Massachusetts. As a full line Kubota dealer, Ahearn Equipment is primarily focused on compact construction, agricultural and rural lifestyle markets. Established in 1977 as a farm equipment service, the business evolved into a full service dealership. In later years, Ahearn Equipment has grown heavily into industrial and rental segments. Josh has served on the Kubota National Dealer Advisory Board, and currently serves

on the EDA Outdoor Power Equipment Council representing all OPE dealers with manufacturers across

USA and Canada. Josh Ahearn (left) receives the gavel from John Komarisky, now Past Presi-dent of NEDA (right).

IN THIS ISSUE:3 Observations from the Field4, 6 Association News5 NY Farm Show7 Board / Committee Members for 20168 Equipment Industry News10-11 Trucking Compliance Seminar14 Affordable Health Care Act Information15 OSHA Fines Could Increase Next Year16 Now Trending: The myRA

18 Tax Tips20 Human Resources - FMLA Information22 Merger Mania 24 What Makes a Successful Sales Meeting26 Keeping Your Retirement Options Open27-28 Equipment Industry News

ADVERTISER’S:2 Haylor, Freyer & Coon 9 NEDA Light Specials13 Electronic Merchant Systems17 BallastStar17 PartnerShip21 Fastline29 Federated Insurance

NEDA Salutes our Supporting Advertisers. It is our pleasure to list the names of those advertisers who support NE Dealer each month. We trust their advertisement will be remembered when goods and services are required by you, our dealer members. It is good to do business with companies who are interested in doing business with you and your industry association.

To see if you qualify, call Patrick Burns at Haylor, Freyer & Coon 800-289-1501, Ext. 2148or fax a current declaration page to 315-684-9801 or call

Ralph Gaiss (Executive Director of NEDA) at 800-932-0607 for more information.You may also visit us at www.haylor.com

Northeast Dealer | DECEMBER 2015 … 3

This publication is designed to provide accurate and authoritative information in regard to the subject matter co v ered. It is furnished with the understanding that the Northeast Equipment Dealers Association, Inc., the publisher, is not engaged in rendering legal, accounting or other professional service. Changes in the law duly render the information in this pub-lication invalid. Legal or other expert advice should be obtained from a competent professional. Some of the editorial material is copyrighted and may be reproduced only when permission is obtained from the publisher and the association.

Board of DirectorsOfficers

JOsH AHeArN, President EDA OPE Dealer Council MemberAhearn Equipment, Inc. / Spencer, MA508-885-7085 • Fax: 508-885-7261Kubota, Cub Cadet, Stihl, NAPA [email protected]

rOBerT sPOHN, First Vice President / Treasurer / Past President - 2005Sharon Springs Garage / Sharon Springs, NY518-284-2346 • Fax: 518-284-2774AGCO, White, Hesston, Gehl, Kubota, Allis, [email protected]

JOHN e. KOMArisKY, 2nd Vice President / Immediate Past President 2015, 2012Main & Pinckney Equip Inc. / Auburn, NY315-253-6269 - FAX 315-253-5110New Holland, Simplicity, Brillion, Bush Hog [email protected]

BriAN cArPeNTer, Chairman of the Board for EDA, St.Louis, MOChamplain Valley Equipment / Middlebury, VT802-388-4967 • Fax: 802-388-9656New Holland, Case IH, Kubota, [email protected]

rALPH GAiss, CEO and Executive Vice Pres.800-932-0607, Ext. [email protected]

DirecTOrs

scOTT BAir, Director ElectMountain View Equipment, Inc. / Plattsburgh, NY518-561-3682 • Fax: 518-561-3724John Deere AG/CCE, Claas, Kuhn Knight, Kverneland, Stihl, Husqvarna, Frontier, Servis, [email protected]

BrAD HersHeYHoober, Inc. / McAlisterville, PA717-463-2191Case IH, JCB, [email protected]

eD HiNes, Past President 2014, 2001Hines Equipment / Cresson, PA814-886-4183 • Fax: 814-886-8872Case IH, Gehl, New Idea, Cub [email protected]

NATe sHATTUcK, Past President - 2010Devon Lane Farm Supply, Inc. / Belchertown, MA413-323-6336 • Fax: 413-323-5080Yanmar, Landini, Monosem, Ferris, Simplicity, Stihl, [email protected]

scOT L. sTANTON, Past President - 2003Stanton Equipment Inc. / East Windsor, CT860-623-8296 • Fax: 860-627-9832John Deere Ag., Knight, Athens, [email protected]

WeNDeLL WALLDrOff, Past President - 2002Walldroff Farm Equip., Inc. / Watertown, NY315-788-1115 • Fax: 315-782-4852New Holland, Hesston, Woods, White-New Idea, AGCO, [email protected]

DAviD WArNerWarner Tractor & Equipment Inc., Troy, PA570-297-2141Case, Case/IH, Takeuchi, LinkBelt, LandPride, Agr. & Construction [email protected]

Northeast equipmeNtdealers associatioN

128 Metropolitan Park Drive • Liverpool, NY 13088

Who’d have thought December would be here so soon?! Seems like we just finished up our regional meetings, only to have the next round of meetings just around the corner! Keep your eyes and ears open for more news and details regarding next year’s regional meetings: we’ve changed the format and locations in response to feedback we received from our membership survey and focus group members. I’m excited about the changes and think that you will be too!

Most of you have received your mem-bership renewal notice; in light of this, it is

reasonable to ask, am I getting a fair return on my investment? Chances are that the answer to that question will not be the same for every dealer. After all, no two dealers are the same: each is a unique business – they differ in terms of volume, number of employees, primary line(s), specialty/focus, and most importantly customer base. That being said, our survey and focus group identified Legislative Advocacy and Manufacturer Relations as our member’s highest priorities. While I am keenly aware of these things, I’m not sure all of our mem-bers fully appreciate how much time, money, and effort NEDA has invested in Legislative Advocacy on our member’s behalf, or how these efforts have impacted the returns you’ve experienced. Since 2007 we’ve managed to amend 3 state equipment dealer laws, one of them twice (Maine). The first law amended was the New York law, in which we increased the parts margin paid to dealers for Warranty repairs from 15% to 20% and the labor rate “to retail/posted”, added the right for dealer to cancel a contract and other improvements. The second law amended was the Maine Dealer Law, in 2011, we increased parts margins to 20% for warranty on equipment sold by a dealer and 30% (or retail in selected cases) for equipment sold by a non-servicing dealer, added construction and Forestry dealers, protection against coercion and forced dealer purity. We were also forced to amend the Maine dealer law a second time in 2013 by adding a provision forbidding manufacturers from recovering the cost of warranty repairs from “their” dealers, mirroring the Automobile dealer law. The last dealer law amended in 2013 was in New Hampshire, where, rather than following the strategy of repeatedly “tweaking” the Equipment Dealer Law, we chose to swing for the fences and include Equipment Dealers in the Automobile Dealer law like their brethren selling ATV’s, Snowmobiles and Motorcycles. John Deere, CNH, Kubota and Husqvarna and AGCO filed a legal challenge to the legislation, oral arguments were heard before the New Hampshire Supreme Court on Sept 10th, 2015. NEDA and NHADA co-filed an amicus brief for the court’s consideration. We expect the court’s rul-ing to be published in the spring of 2016 and remain hopeful that the court will decide in the dealer’s favor.

continued on page 4

Observationsfrom the FIELD

Tim WentzField Director717.576.6794

4 …”Committed to Building the Best Business Environment for the Northeast Equipment Dealer”

Observations continued from page 3

I should add that we are also aware of at least one proposed bill intro-duced on the manufacturer’s behalf which we successfully lobbied against. In Pennsylvania, we have had 5 bills introduced since the 2008-9 sessions and have had bills passed by both houses (unfortunately not in the same session) and are working hard to see that the current bill (HB 1553) is enacted and are also working in Vermont on our second attempt H.328 is also enacted. We’ve been busy! As you know Legislative Advocacy isn’t cheap! All of this wouldn’t have happened had it not been for substantial investments by NEDA, the active participation and support of your fellow member dealers. My point here is NEDA membership pays! Unfortunately, non-member dealers also benefit from “your” investment. Knowing that there is much more work to be done and that to succeed we’ll need everyone’s help! I urge you to take time this fall and winter to contact as many non-member dealers as you can and ask that they also join NEDA, add their voice and help defer the expense. “When we work together as an Equipment Dealer Association, we speak in a unified voice. Together we can achieve what individuals could not; the ability to attain our mutual goals.” It goes without saying the more voices we have, the more successful we’ll be! REMEMBER Reap the benefits of membership & PROFITS will follow!

Share Your Dealership News With Us Have you celebrated a business or personal anniversary, facility expansion, or prestigious award from one of your suppliers, a special community event you participated in or any other way your business has been recognized that you would like to share with other member to have published in our monthly newsletter "The Northeast Dealer" or in the Weekly E-bytes? If so, please con-tact Dave Close, [email protected] or 800-932-0607.

Dot trucking Compliance Regional Meeting Seminar The Department of Transportation (DOT) requires safety training for every person who operates a commercial motor vehicle in interstate and intrastate commerce for all employee supervisors and others. As an employer of commer-cial drivers, you are required to enforce stringent requirements relating to safe operation of vehicles and employee safety and health. Do you understand the requirements? Very few employers do, and IF there is an accident, you can be held accountable in a civil suit, as well as being subject to fines of $2000 minimum per violation and up to $450,000 for multiple violations. NEDA and J.J. Keller, Inc. is offering this safety training seminar for drivers and their employer supervisors to assist members to comply with these regula-tions. Owners (if possible), General Managers, HR Personnel who handle trucking related issues, drivers, dispatchers, loaders and employees that assist with load-ing equipment should be in attendance.

see page 10-11 for a complete agenda!

All Gave Some,

Some Gave All!

Never Forget!!!

ROBERT WATSONMEMORIAL TOY AUCTION

LeClar Bros. Auction ServiceFriday, February 26, 2016 | 5:00p

Building 2, Arts & Home Center


Pennsylvania Dealers Form Task Force to Address Tech Training Facing projected shortages of tech-savvy workers, some of the largest farm-equipment dealers in the region assembled at Pequea Valley High School to launch a pilot on-the-job apprenticeship program based in Lancaster and Chester counties. Flanked by Pequea Valley FFA students, state Agriculture Secretary Russell Redding announced the formation of the Agriculture Equipment Service Technician Working Group. The announcement marked the beginning of the first-ever Lancaster County Ag Week to celebrate the county’s rich and proud agriculture heritage. The goal of the new apprenticeship initiative is to teach high school students the specific skills needed to maintain farm equipment increasingly high tech. Students would then be hired by the dealers for further training. The need is pressing as the state Ag department projects a need for 75,000 new jobs over the next 10 years in agriculture and the food-processing sector. Some of that shortage is from retirements. But it’s mostly because of farming and food-processing practices that increasingly rely more on technology and automation. People qualified to operate and service those machines and computers will be more in demand. And currently, there’s a gap in teaching them those skills. “Picking up a wrench is not the starting point anymore,” said Simon Nichols, director of after market sales for New Holland Agriculture. Added Don Hoover, president of Rothsville-based Binkley & Hurst, “Just like nearly everything else in our world, from autos to airplanes, computers and high-tech advances are making a very significant impact on the way things get done in agriculture. “This industry needs people who have the capacity and desire to set a course early in their educational journey which will guide them to a fulfilling career in what we have identified as literally thousands of ag-oriented jobs.” Joining New Holland and Binkley & Hurst in the venture are other equipment dealers such as John Deere, the Northeast Equipment Dealers Association, spearheaded by Tim Wentz, our field director for NEDA and all dealers, Hoober Inc., Messick’s and Deere Country Equipment. Signing up to teach the skills identified by the task force are these high schools: Pequea Valley, Solanco, Octorara, Penn Manor, Elizabethtown, Manheim Central, Lancaster Mennonite and Lampeter-Strasburg. “What we have to do,” said Redding, “is compete for that talent and show the students here at Pequea Valley and students across Pennsylvania that agriculture is a place that has meaningful employment with tremendous opportunity. “There’s personal satisfaction and a contribution to a quality of life. But it’s also a place that they can earn a good living addressing both the needs of their families but also that of our communities.” One segment of the population that Pennsylvania agriculture officials will target to learn Ag and food-processing skills is veterans. Redding noted that the state has the second-highest number of vets. Redding had profuse praise for Lancaster County’s contribution to agriculture on a local, state and global scale. “Every time I come to Lancaster County I marvel at the amazing work ethic, pride and stewardship that are here,” he said, against a backdrop of huge state-of-the-art tractors equipped with equipment that can use cell phone satellites to plant crops within an inch of how the farmer planned it. “I look at the co-existence here — your ability to manage the interface between agriculture and the larger community. That’s not easy to do.” And he praised the county’s place as the leading farm-preservation effort in the nation, saying it is only because of a combination of commitment from the county, its residents and private groups such as Lancaster Farmland Trust.


eXecutiVe/oFFicers ***NEDA Officers ***President Josh Ahearn ***1st VP/Treasurer Bob Spohn ***2nd VP John Komarisky ***Immediate Past Pres John Komarisky ***CEO Ralph F. Gaiss

NomiNatiNG Chairman John Komarisky

FiNaNciNG Chairman John Komarisky

leGislatiVe **Association Management Personnel Chairman & NEDA Field Director, Tim Wentz ** State of PA Lobbyist iNdustrY relatioNs represeNtatiVes to dealer maNuFacturersAGCO Mfg. Chairman Wendell Walldroff Case IH Co. Chairman Ed Hines John Deere Co. Chairman Scot StantonKubota Tractor Chairman Bob SpohnNew Holland Mach. Chairman Brian CarpenterOPE Mfgs. Chairman Josh AhearnMahindra Tractor Chairman TBA iNsuraNce Chairman Bob Spohn* *Also serves on the Board Committee as Chairman for NEDA’s Workers Compensation Safety Group 548

reGioNal/aNNual meetiNGs **Association Management Personnel Chairman Ed Hines Coordinator Dave Close** Ralph Gaiss** Tim Wentz**

NeW YorK Farm shoW board oF directors President MattJungmann(FPC)• Vice- President Wendell Walldroff Secretary/Treasurer Don Tourte (FPC) Member at Large Bob LeFrancois •MattJungmann,PresidentFarmProgressCompaniesisnowalsoDirectorand President of New York Farm Show Board of Directors

Neda NY WorKers compeNsatioN saFetY Group 548: Chairman Bob Spohn Group Manager Patrick Burns Director Tracey Buck Director Steve Carpenter Director Ralph Gaiss Director Dave Walldroff Director TBA equipmeNt dealers associatioN, iNc. (eda), st. louis, mo eda NatioNal director: Chairman of Board Brian Carpenter

eda ope director: Director Josh Ahearn

YOUR NEDA BOARD COMMITTEES FOR 2016


EQUIPMENT INDUSTRYN e w s

Federated Insurance is ready to help you and your business reduce distracted driving. Federated’s marketing representatives will introduce clients to these resources, which they can use to create a driving policy or refine their company’s distracted driving risk management program. It’s up to each of us to make it a priority to end distracted driving. The lives of everyone important to us may depend on it. We want you to make it home safely every day. For more information on this and Federated Insurance’s other risk management programs, or to locate your local representative, visit www.federatedinsurance.com or call 1-800-533-0472

In spite of opposition from major auto manufacturers, the Library of Congress sided with fair-use advocates who claimed that car ownership should come with the right to modify one’s vehicle, including the built-in software.

~ FEMA Shortliner

DISTRACTED DRIVING CONTINUES TO BE MUCH MORE THAN JUST “A PROBLEM”

RULING ON SOFTWARE IN CARS IS RELEVANT TO FARM EQUIPMENT

Not only is distracted driving still a serious problem, it is an epidemic. With each new mobile device introduced, the potential for behind-the-wheel distractions increase and so does a business’s exposure to risk. Federated Insurance is very concerned about the persistence of this issue and how it can adversely affect your business. Worse yet is what you might stand to lose as a result of distracted driving. Federated Insurance has rejuvenated efforts to help owners address distracted driving. Our new risk management program asks “What Is Important to You?” It provides a sample mobile device policy, reminder posters, and employee training materials including a thought-provoking video and educational handout. It also presents information on technology solutions which can aid in restricting mobile device use in vehicles.

U.S. authorities have given security researchers permission to study software in automobiles in search of flaws, the Apex Tribune reported. Carrying out repairs will now be legal, but the Tribune reported that users and analysts will breach copyright if they extract or sell code. The ruling came from the Library of Congress, which oversees the U.S. Copyright Office. It was prompted in part by claims that the Volkswagen emissions scandal could have been prevented if users had the right to tinker with the software. The decision may have implications for farm equipment. In April, Deere drew criticism when it submitted an argument to the U.S. Copyright Office that suggested farmers who buy its tractors do not own them but rather have an implied license to drive them. The claim sought to retain the tractors’ software as Deere property.


Northeast Equipment Dealers Association Serving Farm, Industrial & Outdoor Power Equipment Dealers Since 1901

*** December 2015 *** Adjustable Magnetic Based Safety Lights

HF18A-MB (Amber) HF18R-MB (Red)

� 2 Functions: Flashing & Steady � Super Bright LED Lights � Visible to 1.25 mile � Heavy Duty Adjustable Magnet � Last up to 36 Hours on 4 “AA” Batteries

Regular Price: $17.07 Special Price: $14.49 Reg. Sell Price: $24.98 Case: 30 Units

Order Form Item # Qty. Cost Ea. Total Dealership Name: __________________________ HF18A-MB ____ $14.49 _______ Shipping Address: __________________________ HF18R-MB ____ $14.49 _______ City, State, and Zip: ____________________________ SUB TOTAL ________ Terms: NET 30 DAYS TO APPROVED MEMBERS (If not for resale)TAX ________ Freight: PREPAID ON CASE QUANTITIES OF LIKE COLOR SHIPPING ________ TOTAL ________ Payment Method (Prepayment is required) Check Enclosed (Payable to NEDA) __________ Credit Card (VISA or MC) Acct # ____________________________________ Exp. Date: ___________ (Circle One) Cardholder Name: _____________________________ Signature: _______________________________

128 Metropolitan Park Drive, Liverpool, New York 13088 • PO Box 3470, Syracuse, New York 13220 800-932-0607 / 315-457-0314 Fax: 315-451-3548 Website: www.ne-equip.com

OFFER EXPIRES: December 31, 2015

2016 N

EDA AN

NUAL R

EGIONA

L MEET

INGS

TRUCKING COMPLIANCE SEMINARTRUCKING COMPLIANCE SEMINAR

Monday February 8best Western Premier eden resort & SuitesLancaster PA 17601 | P. 717- 569-6444

WedneSday February 10Holiday Inn Liverpool, NY 13088 | P. 315-457-1122

FrIday February 12Grappone Conference CenterConcord, NH 03301 | P. 603-225-0303

Featured Speaker

Wayne PeaSleySafety Consultant

J. J. Keller & Associates, Inc.®

With over 30 years of transportation safety experience, Wayne has extensive understanding of regulatory issues that comes from his work in both the public and private sectors. His real-world experience makes him uniquely qualified to provide industry and regulatory guidance.

Featured Speaker

RichaRd TReSTeRSafety Consultant

J. J. Keller & Associates, Inc.®

With over nine years experience working in education and training, Richard is a highly effective consultant specializing in DOT compliance, hazardous materials and bestpractices.

The Department of Transportation (DOT) requires Safety Training for every person who operates a commercial motor vehicle in interstate and intrastate commerce for all employer supervisors and others. As an employer of commercial drivers, you are required to enforce stringent requirements relating to safe operation of vehicles and employee safety and health.

do you understand The requirements??? Very few employers do, and IF there is an accident, you can be held accountable in a civil suit, as well as being subject to fines of $2,000.00 minimum per violation and up to $450,000.00 for multiple violations.

Northeast Equipment Dealers Association (NEDA) is offering this safety training for drivers and their employer supervisors to assist members to comply with these regulations.

8:00 - 8:30 am WelCoMe & InTroduCTIonS• AgendaandIndustryPolls• 10-MinuteTableExercise• Eachtableisassignedtoacategorytodiscussthetopchallengestheyexperience

• Findingswillberecorded(i.e.flipchartprovided)

8:30 - 9:30 am General revIeW on veHICle MarkInGS, reGISTraTIon, InSPeCTIon requIreMenTS, aCCIdenT reGISTer, MCS-150, eTC.• LatestNewsandRequirements• TopViolationsandComplianceSafetyAccountability(CSA)

Applicability• TableExercise–TopChallenges• BestPractices/What’sYourRisk

9:30 - 10:15 am drIver CoMPlIanCe: drIver qualIFICaTIon (dq) and CoMMerCIal drIver’S lICenSe (Cdl) overvIeW• LatestNewsandRequirements• TopViolationsandCSAApplicability• TableExercise–TopChallenges• BestPractices/What’sYourRisk

10:15–10:30am|break

doT SaFeTy CoMPlIanCe aGenda ServICe overvIeWbasing the 1-day training around the already experienced executive Forum content, the safety consultant will emphasize additional areas including transportation of large/small construction equipment, agricultural equipment, etc., including load securement and potential issues with over-dimensional and overweight vehicles. Topics include:

10:30 - 12:00 pm HourS oF ServICe (ParT 395)• LatestNewsandRequirements• TopViolationsandCSAApplicability• TableExercise–TopChallenges• BestPractices/What’sYourRisk

12:00 - 12:45 pm | lunCH break

12:45 - 1:30 pm druG & alCoHol TeSTInG (ParT 40)• LatestNewsandRequirements• TopViolationsandCSAApplicability• TableExercise–TopChallenges• BestPractices/What’sYourRisk

1:30 - 2:15 pm doT audITS (SIx FaCTorS)• LatestNewsandRequirements• TopViolationsandCSAApplicability• TableExercise–TopChallenges• BestPractices/What’sYourRisk

2:15 - 2:45 pm overWeIGHT/over dIMenSIonal PerMITS• TemporaryandAnnualPermits• EscortVehicles

2:45 - 3:00 pm queSTIonS/CloSe oF ProGraM

NortheastEquipmentDealersAssociationEstablished 1901

Committed to Building The Best BusinessEnvironment for Northeast Equipment Dealers

Space is Limited! Register ASAP to be assured a place in this Seminar!!

For More InForMaTIon or To reGISTer onlIne ClICk HereHTTPS://WWW.ne-equIP.orG/evenTS/#!evenT-lIST


Annual Regional Meeting

DOT TRUCKING COMPLIANCESEMINARreGISTraTIon ForM

DOT TRUCKING COMPLIANCESEMINAR

Select date / locationyou will be attending:q Monday February 8best Western Premier eden resort & Suites222EdenRoad|LancasterPA17601Phone: 717- 569-6444

q WedneSday February 10Holiday Inn 441ElectronicsParkwayLiverpool, NY 13088315-457-1122

q FrIday February 12Grappone Conference Center70 Constitution Avenue | Concord, NH 03301603-225-0303

Company ________________________________________________________________________

ContactPerson___________________________________E-Mail _____________________________

Address _________________________________________________________________________

City__________________________________________State_______________ Zip _____________

Phone ________________________________________ Fax _______________________________

Attendees Name Position

1. ____________________________________________________________________________

2. ____________________________________________________________________________

3. ____________________________________________________________________________

4. ____________________________________________________________________________

If registering more than 4 people, copy this form.

Registrationdealermembers:$79perperson

Registrationdealernon-members:$129perperson

If registered after January 22 or later, add $35 for late registration.

Space is limited!register aSaP

to be assured a place in this Seminar!!

2016 NEDA Annual / Regional Meetings

MEETING LOCATIONS:

Wednesday February 10, 2016 Holiday Inn 441 Electronics Parkway Liverpool, NY 13088 315-457-1122

Friday February 12, 2016 Grappone Conference Center 70 Constitution Avenue Concord, NH 03301 603-225-0303

Monday February 8, 2016 Best Western Premier Eden Resort & Suites 222 Eden Road Lancaster PA 17601 Phone: 717- 569-6444

PleaSe IndICaTe TyPe oF PayMenT:qBillmeqCheckEnclosedfor$_______________

q Please charge $_______________ to: q MCq Visa

Card#________________________________________Exp_________ ______

Name on Card___________________________________Security Code _________

Signature _______________________________________________________

reTurn CoMPleTed ForM To:

128 Metropolitan Park DriveLiverpool, NY 13088Fax to: 315-451-3548

Email to: [email protected]



All training materials are included in the cost of the seminar. each attendee will receive:HoursofServiceHandbook | CSAHandbook | TransportSafetyRiskManagement&

Security Newsletter | DOTCompliance&SafetyProgramManagement |

BuildaSmarterComplianceProgram | Encompass with E-Logs |

CSA–ACompanyAssessment | Presentationnotetakingpages |

Presenter’sBibliography | Folder


This is the second of a two-part article. Part one appeared in November's NE Dealer.

We have discovered that the average dealer has little more than a 30% service market share (30% of the dealers’ customer base is using the dealerships’ service department), which leaves 70% of the dealers’ customers shopping elsewhere for service. This 70% is the dealership’s unrecognized opportunity for dramatic sales and profit increases. If your dealership mirrors this model or is an average dealership then it becomes the time to truly market your Service Department. The successful equipment dealer should market the fact that the dealership wants the customer’s service business and is willing to guarantee that the dealership wants to keep the customer’s unplanned downtime to an absolute minimum. As always, let us remind the dealer that your service department is a key element in increasing the dealership’s parts business? If your dealership is performing the

service business or is performing planned maintenance for the customer, it is your dealership that is getting the parts business. The other reminder is that service sales and profits also have a dramatic effect of increasing the dealership’s Absorption Rate. As we mentioned at the start of this article, customers don’t approach you for business, you have to approach them! One of our clients in the golf and turf industry could not understand why one of their customers who owned thirty pieces of the dealer’s lines of equipment purchased the bulk of their parts from the will-fitters. A survey of the customer indicated that the will-fitter called on the buyer a minimum of once a month and in season more often. Furthermore, these personal sales contacts were supplemented by a weekly telephone call to the customer from the will-fitter. The dealership was a short six minutes away from the customer. In a period of five years, no one from the dealership’s parts department had called upon the customer to ask for the parts business. It doesn’t take a consultant or a brain surgeon to discover what the problem was at this dealership. We have mentioned it many times in our articles and seminars, that marketing your dealership’s aftermarket requires the same techniques used in the marketing of complete goods. Equipment dealers have sales personnel for complete goods. It therefore stands to reason that there is a need for sales personnel for product support. Developing a thriving aftermarket or product support sales program takes a great deal of work and effort. It is a program that must originate with the dealer principal. It is a program that will assist your dealership to regain, retain and grow your overall dealership profitability. We recommend that dealers who do not have a CSSR program consider the possibilities of developing this program. Those dealers who do have a program should continue to work at the program to keep it successful. Successful dealers will tell you that this program develops the financial strength of the dealership dramatically. Here’s your Manual Special for this month: Service Marketing for Equipment Dealers, this is a 68 page manual, again on special for $16.99. It covers extensively the topic of selling service to your customer base. It answers every question you might be asked by the customer, it is a must for every Service Manager, every CSSR, PSSR, every prospective CSSR and for Branch Managers and Dealer Principals. Email us at [email protected] we will email you the manual along with our invoice. If for any reason the manual does not exceed your expectation, email us and let us know and then you may discard your invoice . . . have a great sales and profit week.

CUSTOMERS DON’T ALWAYS APPROACH YOU FOR BUSINESS YOU SOMETIMES HAVE TO APPROACH THEM!

the aFter marKet sales Force

BY JOHN WALKERPresident,AfterMarketServicesConsultingCo.,Inc.–817StockbridgeDrive,#399,Ft.Mill,SC29708•Cell918-230-0791

www.amsconco.com

Be on Guard! thefts Increase During the Holidays Heavy Equipment will be stolen nationwide before and during the winter holidays. –With Christmas and New Year's falling on Fridays, the potential for equipment crime is especially high for the upcoming winter holidays. NER asks both Law Enforcement and the Industry to be watchful of suspi-cious activity involving equipment:

•Trucksparkedatrentalyardsanddealershipsthatdonotbelongtothecompany - especially box vans, U-hauls and enclosed race car hauler type trailers.

•Gatesleftopenatfacilitiesandjobsiteswhenit'sclearthesiteisclosed.•Evening,latenight,orearlymorningactivityinsideayard,construction

site, farm or rental store throughout the holiday.•Heavilyandhastilyloadedrentalcompanyordealertrucksonroadways

throughout the holiday. Don't let equipment crime spoil your Holidays. For more information and simple proactive suggestions, see the complete NER Winter Holiday Advisory Law Enforcement personnel are encouraged to verify ownership or rental status on any equipment in transit as it may be an undiscovered theft. Contact NICBforaccesstoNER'sownershipregistrationandfleetrecords:800-447-6282.Register here for online access to NER's data. Industry personnel are encouraged to contact local Law Enforcement on sus-picious activity. Being in the industry you know when something does not seem right.Don'tjustletitgo,Call911!


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health iNsuraNce ... aFFordable care act ... medical

ACA AND EMPlOYERS – KNOW If COVERAgE YOUOffER MEETS REqUIREMENTS

employer shared responsibility provisions, you can deter-mine whether you offered affordable coverage under various safe harbors based on information available to the employer. minimum essential coverage: For purposes of reporting by applicable large employers, minimum essential coverage means coverage under an employ-er-sponsored plan. It does not include fixed indemnity coverage, life insurance or dental or vision coverage. minimum value coverage: An employer-spon-sored plan provides minimum value if it covers at least 60 percent of the total allowed cost of benefits that are expected to be incurred under the plan. Under existing guidance, employers generally must use a minimum value calculator developed by HHS to determine if a plan with standard features provides minimum value. Plans with nonstandard features are required to obtain an actuarial certification for the non-standard features. The guidance also describes certain safe harbor plan designs that will satisfy minimum value.

~ IRS

Under the Affordable Care Act, certain employers, based on workforce size – called applicable large em-ployers – are subject to the employer shared responsibil-ity provisions. The vast majority of employers fall below the workforce size threshold and, therefore, are not sub-ject to the employer shared responsibility provisions.If you are an employer that is subject to the employer shared responsibility provisions, you may choose either to offer affordable minimum essential coverage that provides minimum value to your full-time employees and their dependents, or to potentially owe an employ-er shared responsibility payment to the IRS. Many em-ployers already offer coverage that is sufficient to avoid owing a payment. Here are definitions of key terms to help you under-stand these requirements: affordable coverage: If the lowest cost self-only health plan is 9.5 percent or less of your full-time employee’s household income then the coverage is con-sidered affordable. Because you likely will not know your employee’s household income, for purposes of the

Employers with 50 or more full-time employees, including full-time equivalent employees, in the previous year use Form 1095-C, Employer-Provided Health Insurance Offer and Cover-

age, to report the information required about offers of health coverage and enrollment in health coverage for their employees. Form 1095-C is used to report information about

each employee. Employers that offer employer-sponsored self-insured coverage also use Form

1095-C to report information to the IRS and to employees about individuals who have minimum essential coverage under the employer plan and therefore are

not liable for the individual shared responsibility payment for the months that they are covered under the plan. An employer must furnish a Form 1095-C

to each of its full-time employees by January 31 of the year following the year to which the Form 1095-C relates.

Employers will meet the requirement to furnish Form 1095-C to an employee if the form is properly addressed and mailed on or before

the due date. If the regular due date falls on a Saturday, Sunday, or legal holiday, employers may file by the next business day. The Form

1095-C that employers send may include only the last four digits of the employee’s social security number, replacing the first five digits with aster-

isks or Xs. Forms 1095-C must be sent on paper by mail or hand delivered, unless the

employee consents to receive the statement in an electronic format. The consent ensures that the employee can access the electronic statement. If mailed, the state-

ment must be sent to the employee’s last known permanent address, or if no perma-nent address is known, to the employee’s temporary address.

Individuals who worked for multiple employers that are required to file Form 1095-C may receive a Form 1095-C from each employer.


HIGHWAY

Beginning on December 22, 2015, the FMCSA is requiring that all medical examiners use the new MCSA-5875 medical form as well as the MSCA-5876 medical certificate when conducting DOT physicals. There is no grace period for transitioning from the 2012 forms to the new forms.

For medical exams conducted before or on december 21, 2015: • ONLYthe2012formsandcertificatesmaybeused. • Thenew2015formswillNOTbeaccepted.

For medical exams conducted on or after december 22, 2015: • ONLYthe2015formsandcertificatesmaybeused. • The2012formswillNOTbeaccepted. FMCSA has not made the final version of the new forms available yet.

NEW MEDICAl fORMS ANDCERTIfICATES COMINg

OSHA fINES COUlD INCREASE OVER 80% NExT YEAR

Congress recently passed the budget agreement which contained a provision which permits OSHA to raise fines significantly starting in August 2016. The law permits a one-time “catch up” increase up to 82 percent, since fines have not been raised since 1990. This “catch-up” amount is tied to the inflation rate from 1990 to 2015. After that, the maximum penalties would increase with the inflation rate every year. This would have the following effect:

citations current max. With “catch-up” increaseOther than Serious Up to $7,000 Up to $12,740Serious $7,000 $12,740Repeat $5,000-$70,000 $9,100 – $127,400Willful $5,000-$70,000 $9,100 – $127,400Failure to Abate $7,000/day $12,740/day

While OSHA has the option of implementing an adjustment less than the maximum amount, Assistant Secretary David Michaels has pushed for years to increase maximum penalties so it seems unlikely that they would not take full advantage of this increase. Based on the impending increase to OSHA fines (which would also be required of approved State Plans as well), employers are well advised to audit their compliance with applicable OSHA regulations to ensure that programs, policies and training are all up to date. See more at: http://www.natlawreview.com/article/osha-fines-could-increase-over-80-next-year#sthash.yED7LeOd.ZRWC7pal.dpuf

Significant Increases Ahead In OSHA’sCivil Penalties

The federal bipartisan budget contained a little-noticed provision titled the Federal Civil Penalties Infla-tion Adjustment Act Improvements Act. This Act requires the Occupa-tional Safety and Health Administra-tion (OSHA) to increase its monetary penalties for the first time since 1990. For the past 25 years, OSHA has been exempted from a federal law requiring agencies to increase their fines along with inflation. This will change for OSHA’s penalties beginning in August 2016. The law first requires an initial penalty “catch-up adjustment.” The catch-up adjustment is based on the percentage difference between the Consumer Price Index (CPI) in October 2015 and in October 1990. This will likely result in about an 80% increase in the current penalty amounts. After this initial catch-up adjustment, the law requires OSHA to adjust the penalty amount annually for inflation. So this adjustment will first occur in January 2017.

~ Vorys LLP


bY bART bASI

NOW TRENDING: the myra

If you have $1 (one dollar) in your retirement account and you are age 25-64, congratulations you have more money in your retirement account than 45 percent of Americans in that age bracket. Many Americans are not saving for their retirement at all and that is a problem! Your retirement goal is to have sufficient funds to re-lax and enjoy your senior years without having to work. Many have come to despise this goal because they feel it is unattainable, unrealistic or even cruel. There are no magic strategies in investing. I’m not one to preach stocks, or real estate, or commodities, but ask yourself one ques-tion: Who will fund my retirement if I don’t? Bottom line, you have to start somewhere and go someplace. There is a new retirement program available now.

how the New retirement program Works This new program is called myRA. Employers are not required to par-ticipate in the new program. The myRA account is administered through the United States Treasury. The plans can be funded by an em-ployer, a personal account, or even from a federal tax refund. The employee must have earned income to partici-pate. A key to the new program is that there are no ad-ministrative costs. To participate, the fund participant goes to myRA.gov, selects the “sign up” option, and follows the step-by-step process. They receive an account number and then fund the account by setting up automatic deposits through their employer, their own accounts, or federal tax refund. If the employer already has a retirement account such as a simple or 401K, then the myRA is not available. The costs to the employer are very little and are an inexpensive alternative for employers that don’t set up retirement accounts. When funding the plans, individuals can give a set percentage of money per payroll period or contribute as they go along. There is no minimum contribution. There is no initial startup fee.

advantage of retirement accounts in General Any money put into a Traditional IRA reduces the employee’s taxable income. The limit an employee can contribute is $5500 annually. That is unless they are 50 or over, they can add an additional $1000 to their annual contribution for a total of $6500 per year. Income limits are $131,000 for single taxpayers and $193,000 for mar-ried filing jointly.

The myRA is a Roth IRA. In a Roth IRA, the individual does not get a dollar-for-dollar adjusted gross income ad-justment, but instead the funds are tax free when taken out upon retirement. Thus, the employee must contribute after tax dollars now. Additionally, retirement accounts are generally exempt in a bankruptcy. Bankruptcy is a common occur-

rence, no matter what a person’s income or holdings may be. Having money pro-tected in a retirement account has ad-vantages compared to ordinary savings accounts, CDs, and checking accounts.

myra differs from other Funds and retirement accounts The major objective of the new program is to get individuals of all ages into a retirement fund. This new program has a good rate of return. The fund invests in 30 year Treasury savings bonds that have returned 3.19% over the past 10 years. The good part about this account is it cannot lose money. There are no com-plicated investment strategies, unlike many other funds.

The only drawback is that these accounts are mainly starter accounts. The balance limit is low. Once the account balance reaches $15,000 or the account is in existence 30 years (whichever is first), the account holder must rollover the account into a private account. Once this is done, the investor cannot begin another myRA.

What if i can’t open a myra? Other plans such as Traditional and Roth IRAs are available still. This law did not eliminate or limit the use of Roth and Traditional IRAs in anyway. An IRA can be started online or at a local bank with hardly any startup costs. Just go to any local bank and ask what their terms, condition, and costs are regarding their IRA’s.

conclusion While this program is not for everybody, it hopefully will get the ball rolling for millions of Americans. We do an array of business services including Business Valua-tion and Business Succession Plans for many closely-held businesses throughout the country and can assist in these areas. If you have any questions about the subject matter herein, Business Valuations, Business Succession Planning or would like additional information, please contact theprofessionals. Dr. Bart A. Basi, Senior Advisor of the Center for Financial, Legal & Tax Planning, Inc., is an expert on closely-held compa-nies, an attorney, and CPA. He is a member of the American Bar Association’s Tax Committees on Closely-Held Businesses and Business Planning, Marion, Il. – 618-997-3436 – www.taxplanning.com

The costs to the employer are very little and are an

inexpensive alternative for

employers that don’t set up retirement

accounts.


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18 …”Committed to Building the Best Business Environment for the Northeast Equipment Dealer”18 …”Committed to Building the Best Business Environment for the Northeast Equipment Dealer”

TAX TIPS The IRS reminded eligible employees that now is the time to begin planning to take full advantage of their employer’s health flexible spending arrange-ment (FSA) during 2016. FSAs provide employees a way to use tax-free dollars to pay medical expenses not covered by oth-er health plans. Because eligible employees need to decide how much to contribute through payroll deductions before the plan year begins, many employers this fall are offering their employees the option to participate during the 2016 plan year. Interested employees wishing to contribute dur-ing the new year must make this choice again for 2016, even if they contributed in 2015. Self-employed individuals are not eligible. An employee who chooses to participate can contribute up to $2,550 during the 2016 plan year. Amounts contributed are not subject to federal income tax, Social Security tax or Medicare tax. If the plan allows, the employer may also contribute to an employee’s FSA. Throughout the year, employees can then use funds to pay qualified medical expenses not covered by their health plan, including co-pays, deductibles and a variety of medical products and services rang-

The IRS recently simplified the paperwork and recordkeeping requirements for small businesses by raising from $500 to $2,500 the safe harbor threshold for deducting certain capital items. The change affects businesses that do not maintain an applicable financial statement (audited financial statement). It applies to amounts spent to acquire, pro-duce or improve tangible property that would normally qualify as a capital item. The new $2,500 threshold applies to any such item substantiated by an invoice. As a result, small businesses will be able to immediately deduct many expenditures that would otherwise need to be spread over a period

Plan now to Use Health flexible Spending Arrangements in 2016; Contribute up to $2,550; $500 Carryover Option Available to Many

for Small businesses: IRS Raises Tangible Property Expensing Threshold to $2,500; Simplifies filing and Recordkeeping


ing from dental and vision care to eyeglasses and hearing aids. Interested employees should check with their employer for details on eligible expenses and claim procedures. Under the use or lose provision, participating em-ployees often must incur eligible expenses by the end of the plan year, or forfeit any unspent amounts. But under a special rule, employers may, if they choose, offer participating employees more time through ei-ther the carryover option or the grace period option. Under the carryover option, an employee can carry over up to $500 of unused funds to the follow-ing plan year—for example, an employee with $500 of unspent funds at the end of 2016 would still have those funds available to use in 2017. Under the grace period option, an employee has until 2½ months after the end of the plan year to incur eligible expenses—for example, March 15, 2017, for a plan year ending on Dec. 31, 2016. Employers can offer either option, but not both, or none at all. Employers are not required to offer FSAs. Accord-ingly, interested employees should check with their employer to see if they offer an FSA. More informa-tion about FSAs can be found in Publication 969 , available on IRS.gov.

of years through annual depreciation deductions. As before, businesses can still claim otherwise deductible repair and maintenance costs, even if they exceed the $2,500 threshold. The new $2,500 threshold takes effect starting with tax year 2016. In addition, the IRS will provide audit protection to eligible businesses by not challenging use of the new $2,500 threshold in tax years prior to 2016. For taxpayers with an applicable financial state-ment, the de minimis or small-dollar threshold remains $5,000. Further details on this change can be found in Notice 2015-82, posted on IRS.gov.


Our hearts growtender with childhood memories and love of kindred, and we are better

throughout the year for having, in spirit, become a child again at Christmas Time.

- Laura Ingalls Wilder

At the holiday season

our thoughts turn gratefully

to those who have made our

progress possible. We wish

all members and their families

a very Merry Christmas

and the best the season

has to offer.

NEDA Officers,

Directors and Staff


RESOURCESHuman

If the employee doesn’t pay his or her premium, can the employer cancel the em-ployee’s health benefits? An employer is required to maintain group health coverage for an employee on FMLA leave on the same terms as if the employee had continued to work. For ex-ample, if an employee has family coverage under the health plan, the employee must be allowed to continue this family cover-age during his or her FMLA leave. Health plan changes that apply to all active em-ployees—such as changes in coverage, premiums or deductibles—must also apply to employees on FMLA leave. An employer may require employees taking FMLA leave to pay their share of health plan premiums, although they can-not be required to pay more than what they would have paid if they had remained ac-tively employed. An employee may choose not to retain group health plan coverage while on FMLA leave or may stop paying premiums for his or her coverage. Unless an employer has an established policy with a longer grace period, the employer is not required to maintain health coverage for an employee on FMLA leave if the employee’s premium payment is more than 30 days late. Employers must notify employees on FMLA leave before health care coverage is dropped for lack of premium payments. Generally, an employer must provide writ-ten notice to the employee at least 15 days before coverage is to cease. The no-tice must explain that the payment has not been received and that coverage will be dropped on a date that is at least 15 days after the date of the letter, unless payment is received by that date. Alternatively, when an employee stops making premium payments while on FMLA

leave, the employer may decide to maintain the employee’s coverage by paying both its share and the employee’s share of the premium. After the FMLA leave ends, the employer may recover from the employee the portion of the employee’s share of the premium that it paid, even if the employee does not return to work following leave. Upon the employee’s return from FMLA leave, the employer must uncondi-

tionally restore the employee to the same coverage and benefits that he or she would have had if he or she had not taken leave and stopped paying premiums. The employee cannot be required to re-qualify or meet any other conditions prior to being reinstated to the group health plan.

~ Submitted by Benefits Consultant Haylor,Freyer & Coon,Inc.

1-800-289-1501

Do Employers Have to Maintain an Employee’s Health benefits on fMlA leave?

fMlA – Does Depression qualify? Question: An employee has requested a leave due to depression. I advised her to seek medical advice and provided her with FMLA. Is depression usually considered a valid reason to be off work under the FMLA guidelines? Response: It can be. The U.S. Department of Labor's Compliance Guide summarizes the definition of a serious health condition for FMLA purposes as follows: "Serious health condition” means an illness, injury, impairment, or physical or mental condition that involves:

•anyperiodofincapacityortreatmentconnectedwithinpatientcare(i.e.,anover-night stay) in a hospital, hospice, or residential medical care facility; or

•aperiodofincapacityrequiringanabsenceofmorethanthreecalendardaysfromwork, school, or other regular daily activities that also involves continuing treat-mentby(orunderthesupervisionof)ahealthcareprovider;or

•anyperiodofincapacityduetopregnancy,orforprenatalcare;or•anyperiodof incapacity (or treatment therefore)duetoachronicserioushealthcondition(e.g.,asthma,diabetes,epilepsy,etc.);or

•aperiodofincapacitythatispermanentorlong-termduetoaconditionforwhichtreatmentmaynotbeeffective(e.g.,Alzheimer's,stroke,terminaldiseases,etc.);or,

• anyabsencestoreceivemultipletreatments(includinganyperiodofrecoverythere-from) by, or on referral by, a health care provider for a condition that likely would resultinanincapacityofmorethanthreeconsecutivedaysifleftuntreated(e.g.,chemotherapy, physical therapy, dialysis, etc.)." See http://www.dol.gov/whd/regs/compliance/1421.htm.

Thus, depression may be a serious health condition under the FMLA if it meets one or more of the criteria listed above. We also wish to point out that whether or not depres-sion qualifies as a serious health condition under the FMLA, it may qualify as a disability underthefederalAmericanswithDisabilitiesAct(ADA),whichmayentitletheemployeeto time off as a reasonable accommodation. This is addressed specifically by the U.S. Equal Employment Opportunity Commission in its guidance on psychiatric conditions and the ADA which is available at http://www.eeoc.gov/policy/docs/psych.html and which we encourage you to review. © 2014 Advisors Law Group, All Rights Reserved – To learn more about the Federated Employment Practices Net-

work®, contact your local Federated Marketing Representative, or visit www.federatedinsurance.com.


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This is a complete list of all First Aid Treatments.

Any other treatment would be considered Medical Treatment, and thusOSHA Recordable.

Non-prescription medication Tetanus immunizations Cleaning,flushing,soakingwounds Wound coverings Hotorcoldtherapy Non-rigid supports Temporaryimmobilizationdevices Drillingfingernailsandtoenails Eyepatches Simple removal of foreignbodies fromtheeye Simple removal of splinters Finger guards Massages Drinkingfluids forheatstress

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bY lANCE fORMWAlT, SEIgfRIED bINgHAM, P.C.

The equipment dealer industry has seen significant consolidation over the last several years and the pace is not slowing as dealers and manufacturers are pursuing ever larger dealer organizations and the resulting benefits that can be achieved if growth is done in the right way. Unlike consolidation occurring within many industries, equipment dealerships often grow through “merger between equals” situations where multiple ownership groups continue to have influence on decision-making after the merger is complete. While a merger can have significant benefits, a “merger between equals” situation creates additional complexities and risks and both dealers and manufacturers should be aware of these potential issues when exploring strategies for growing dealer organizations.

limited equity drives mergers A common issue that I hear is that dealer equity standards required by major manufacturers or their financing divisions drive dealers to use a merger to build organizational size. The reason for this is that a merger requires little equity or debt from either party and therefore does not usually have an adverse effect an organization’s equity position after a merger.

mergers carry additionalrisks/costs Although a merger can address manufacturer/dealer desire for growth without an adverse impact on a dealer’s equity position, is a merger always the right answer? Before adopting a merger approach to growth, dealers should weigh some of the risks and costs associated with a merger: • Increasedriskbecauseeachdealeristaking on all liabilities of the other dealer and the dealer’s personal guarantee is now supporting debt incurred by the other dealer.• Cultural/operational integration canbe more difficult. If multiple ownership

groups have a strong continuing say in the business, there is a higher risk for one of the following three scenarios to develop: (a) delay in development ofpolicies and processes needed to improve the dealership (and create the expectedefficiencies or value) due to a stalemate betweenowners; (b)dealership locationsfunctioning independently under different stylesofleadership;or(c)theorganizationcompromises in a manner that weakens the strength of the prior practices of both organizations.• Transaction costswill be higher dueto efforts to limit the first two risks. This will include legal costs due to (a) morethorough due diligence to understand the liabilities to be assumed (includingemployment, customer and regulatory liabilities) and policies to be integrated and(b)negotiationofbuy-sellagreementsamong the continuing owners. In addition, retaining a consultant to facilitate discussions regarding leadership/culture andprocesses(bothpreandpost-merger)is highly advised.

alternative capital structures – reducing the Need for mergers To facilitate non-merger transactions, I would encourage dealers and manufacturers to consider improving dealer equity in advance of transactions through capital injections from additional investors, including private equity groups or high net worth individuals. Capital could come in the form of traditional equity, preferred equity or debt (subordinatedor unsecured debt). To do this, dealers may need to embrace a partner that brings a different perspective to managing a dealership and understand that the different perspective may be a positive experience that facilitates additional growth and profitability. At the same time, manufacturers would need to be more open to flexibility in the structure of ownership groups, including the definition of equity requirements and consideration of alternative payment security standards in lieu of the traditional unlimited personal guaranty(e.g.,entity-levelliquidnetworth

requirements, limited guarantees, letters of credit, etc.).

mergers are a Viable option for Growth, but … With the increasing growth in dealer organizations, it is important that the industry doesn’t allow mergers to be the default avenue for growth simply due to lack of capital. While a merger is certainly a viable option for growth, it is not always the right answer and can carry significant risks for the long-term success of a dealer organization if it is not properly implemented. Due to the growing size of dealer organizations, these risks should be of increasing concern to both manufacturers and dealers. The bottom line is that the stakes are getting higher for dealers and manufacturers as dealer organizations grow in size. As that happens, dealers will need to invest additional resources in either limiting the risks inherent in mergers or attracting additional capital and manufacturers will hopefully have an incentive to help foster those activities. The challenges that come from taking on additional investment may not be for everyone, but for those dealers and manufacturers willing to embrace it, the payoff in terms of growth may be worth the change.

Lance Formwalt is a member of the Equipment Dealer Practice Group at Seigfreid Bingham, P.C. The firm also serves as legal counsel to the Western Equipment Dealers Association. Lance may be contacted at [email protected] or 816-265-4106. Also see www.seigfreidbingham.com. This article is intended to provide general recommendations and is not intended to be legal advice. You should always consult your attorney for advice unique to you and your business.

ARE MERGERS THE BEST PATH FORGROWING DEALER ORGANIZATIONS?


DEALER Northeast

The Newsletter of NoRThEAsT EquipmENT DEALERs AssociATioN, iNc.JANUARY 2015 c Vol. 17, No. 190

www.ne-equip.com

NEDA Salutes our Supporting Advertisers. It is our pleasure to list the names of those advertisers who support NE Dealer each month. We trust their advertisement will

be remembered when goods and services are required by you, our dealer members. It is good to do business with companies who are interested in doing business with

you and your industry association.

John Komarisky of Main & Pinckney Equipment Inc., Auburn, NY

has been elected to a one-year term as President of NEDA. John was

installed recently at the association’s Board Meeting in Liverpool, NY.

John is General Manager and co-owner with his wife Barbara and

son Greg who is the dealerships Sales Manager. Main & Pinckney is a

very active and busy high volume single store operation. Their ma-

jor lines are New Holland AG, Vermeer Forage, Bush Hog, Brillion,

Simplicity & Ferris and other short lines. Their market includes the

small farm, rural lifestyle, homeowner, commercial landscape and

Municipal market segments. They have a lot of competition in their

trade area and their success for many decades is a result of their excel-

lent service reputation to this diverse customer mix. Their business continues to increase every year with a focus of out-

standing service and fair, timely and efficient service to their custom-

ers. Their best advertisement comes from customer referrals! John continues to be active in his church, community at large and the local fire district.

John will lead our eleven (11) member Board of Directors, that are responsible for oversee-

ing the associations budget, service and product offerings including the excellent insurance

benefit packages the association offers all its dealer members.

New Northeast Equipment Dealers Association President for 2015

IN THIS ISSUE:3 Observations from the Field4, 6, 8 Association News9 Flat Rate Guide - NEDA10 Speakers at Annual / Regional Meetings11 TwoGreySuits – HR Policies12-13 Industry News14 Accomplishing Results16 90% of Sales Success Is . . .18 Risk Management Strategies

19 EPA Requirements20-21 Tax Tips22 Designing an Internship Program23 Network Date Security Info24 Human Resources25 Construction Equipment Guide - NEDA26-27 Equipment Industry News

ADVERTISER’S:2 Haylor, Freyer & Coon 5 New York Farm Show7 Electronic Merchant Systems15 DiversifiedFinancial17 BallastStar

17 Charter Software29 Federated Insurance30 Fastline Publications

wha

t’s

new

?

DEALER Northeast

The Newsletter of NoRThEAsT EquipmENT DEALERs AssociATioN, iNc.

FEBRUARY 2015 c Vol. 17, No. 191

www.ne-equip.com

NEDA Salutes our Supporting Advertisers. It is our pleasure to list the names of those advertisers who support NE Dealer each month. We trust their advertisement will

be remembered when goods and services are required by you, our dealer members. It is good to do business with companies who are interested in doing business with

you and your industry association.

Happy New Year...Here are a few reasons for lifestyle equipment dealer optimism in 2015.

The U.S. economy is improving and many people have disposable money to spend because of the

stronger job market and lower gas prices.

Interest rates are expected to remain low and consumer sentiments the highest it has been since

January 2007. OPE Manufacturers and most other OPE Industry leaders are saying that they are very

optimistic for about a 4% increase in sales growth for 2015.

The International October 2014 GIE-EXPO in Louisville,

KY for the OPE Industry was a real winner and drew about

11% more OPE dealers than the previous year. Tim Wentz

and Ralph Gaiss were there from our association manning a

shared booth with our partner the Ohio-Michigan Equipment

Dealers Association. Ralph said he and Tim saw and spoke

with more member dealers than in previous years.

They also spoke with many non-member dealers that stopped

at the booth and they did get three new member dealers to

join the association during the show and when they returned,

they received calls from other dealers that had an interest to

join. If you never attended this fantastic show for dealers only,

don't miss this opportunity on October 21, 22, 23, & 24, 2015

and mark it on your calendar now...so you don't forget it.

IN THIS ISSUE:3 Observations from the Field

4 Annual / Regional Meeting Speakers

6, 8, 10, 12 Industry News

7 Annual / Regional Meeting Sponsors

9 NEDA February Light Specials

11 TwoGreySuits – HR Policies

14 Accomplishing Results

15 Grounds Maintenance Equip. Blue Book

16 OSHA Updates to Recordkeeping Rule

18 Risk Management Strategies

20, 22 Veterans' Information

23 Health Care Information

25 The Family Board in a Family-Owned

Business

26 NEDA Holiday Schedule

27 Equipment Industry News

28 Marijuana in the Workplace

ADVERTISER’S:2 Haylor, Freyer & Coon

5 New York Farm Show

13 BallastStar

13 Charter Software

17 Electronic Merchant Systems

17 PartnerShip

21 SouthWestern Assoc. – Valuations

29 Federated Insurance

30 Fastline Publications

opE Dealer council The OPE Voice of NEDA

COUNCIL MEMBERS

Dale Magie, Chairman, Liberty Twp., OH

Dale Fronheiser, Bechtelsville, PA

Dan Huff, Pomfret Center, CT

OPERATING STAFF

Kim Rominger Bill Garling

Dennis Alford Dave Close

Ralph Gaiss Tim Wentz

Scott Grigor

NEDA ... Northeast Equipment Dealer Association

(CT, MA, ME, NH, NJ, NY, PA, RI, VT)

IS something newsworthy happening or HAS it happened with you, an employee or your dealership?LET US KNOW! Email us a brief note or send us a newspaper clipping (or link) to your local newspaper. A few minutes is all it takes. We welcome digital submissions, just be sure to include your company name, address, phone/fax, email and web info as well as identification of anyone included in a photo.

WHAT’S NEWSWORTHY?anniversaries • awards of special recognition • expansion or remodeling • open houses • receptions • personnel changes • promotions • retirements • in memoriams • new programs, standards or services • anything else you think we’d be interested in publicizing.

EMAIL [email protected] by the 20th of the month forinclusion in the next month’s newsletter.



outstaNdiNG Year

Ed Hines, a past

president (left)

giving John Komarisky

(right) a plaque for

his outstanding year

as President of NEDA

during the 2015 year.

Ed also presented an

award to John’s wife,

Barbara for supporting

John during his year as

President of NEDA. NortheastEquipmentDealersAssociationEstablished 1901



bY JOHN CHAPIN

WHAT MAkES ASUCCESSfUl SAlES MEETINg?

My friend Steve Lishanski has a saying that 80% of life is common sense but only 20% of people are using it. In my experience, a similar rule applies to sales meetings: 80% are a complete waste of time because simple common sense was never applied.

three rulesFor poWerFul

sales meetiNGs

rule #1: Keep your meetings short, positive, and energized Sales meetings should last for 60 to 90 minutes max and leave people upbeat and ready to tackle the week. Here are some more important components of this rule:

• Themeetingstartsandstopsontime.Nowaitingforpeople who are late and punishing that there on time.

• Haveanagendaand stick to it. Peoplehave30 sec-onds, 5 minutes, or whatever time is appropriate, and at the end of that time, they are done, whether they are or not.

• Itsfinetostartbyreviewingthenumbersandcongrat-ulating people for important wins, but this should last no more than a few minutes. No getting bogged down in details aided by boring Power Point slides.

• Everyonestayspositiveandupbeat.Whileconstructiveconversation about problems and issues is fine and encouraged, you must focus on solutions. If the room turns “all negative with no solutions”, it’s time to put the brakes on and get the focus back on what you can do about the situation.

• No rambling or getting stuck in the weeds with mi-nutia of detail on items that are best handled off-line after the meeting.

• No one high jacking the meeting and taking morethan their allotted time.

• No random vendors, who are not exclusive to yourcompany, talking about the flavor of the week.

• Noboringheadsfromotherdepartmentsdroningonabout their problems and what they need from sales.

Also keep in mind that in order for the meetings to be positive, everyone must be present for each meeting barring some extenuating circumstance. You must have a team men-tality and no individual is an exception.

rule #2:the most important part of the meeting is education Focus on the areas that have the most impact: prospect-ing, presenting, closing, and building relationships with your biggest and most important accounts. Here are some areas you may cover: • Brainstormingstrategytowinanaccount• Howtobeatthecompetition• Howtoaskforreferrals• Howtocoldcallorprospecteffectively• Howtoclosemoredeals The objective here is to get the best stuff from your best people. Some people are great at referrals, others are great at cold calling, and others are great at closing. Also, it’s im-portant that the successful people are talking.

rule #3:open and close the meeting the right way Logistically, you want to hold meetings early on Monday morning to start the week off right. This best ensures every-one is in early and focused at the beginning of the week. Start the meeting with something short and positive. A positive quote or passage from a book is good. You can also have a weekly focus point. Another idea is to highlight some-thing positive that may have happened recently. Next, cover the agenda in 15 seconds or less then bridge into the main part of the meeting. An effective way to close the meeting is to give everyone one or two action items that they can act on immediately. Here are some good examples:

• Gocallonthataccountyou’vebeenafraidtocallon.• Dosomethingyouhaven’tdonebeforeorchallenge

yourself to break your previous best. For example, if the most prospecting calls you’re ever made in a week is 50, shoot for 75 or 100.

• Identify and do the one thing that once done, will ensure the whole week has been a success.

The key to effectively closing the meeting is to harness the energy created to take immediate action and get the momentum rolling toward a successful week. This will also help you develop the habits of stepping out of your com-fort zone, facing your fears, and pushing yourself to become better. John Chapin is a sales and motivational speaker and trainer. For his free newsletter, go to: www.completeselling.com John has over 27 years of sales experience as a number one sales rep and is the author of the 2010 sales book of the year: Sales Encyclopedia. Contact John at 508-243-7359 or email: [email protected].

Contact NEDA today to get your copy of the:EquipmENt BluE Book, CompACt trACtor GuiDE,FArm EquipmENt GuiDE, ANtiquE trACtor GuiDE

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Like most business owners, you are concerned primarily with run-ning your day-to-day operations and growing your business—of-tentimes, planning for your retire-ment may be secondary. According to a 2009 study of small business owners, less than half (47 percent) of the business owners surveyed had a way to save for retirement that was set up through their busi-ness. Twenty-eight percent were not saving at all! For those looking for a simple, yet effective, source of supplemen-tal retirement income, an excellent option may be a permanent life insurance policy. The cash value in the policy accumulates on a tax- deferred basis during your work-ing years, and can be withdrawn tax-free during your retirement years (in the form of policy loans and withdrawals). Unlike qualified retirement plans, such as a 401(k)

or IRA, the contributions are not pre-tax. However, the policy does offer you significant flexibility.

•In addition to the ability toavoid income tax on policy loans or withdrawals, there are no limits on when money can be taken. Money may be loaned from the policy, or you may take withdrawals from the cash value as soon as such values exist.

Unlike most retirement plans, which impose early withdrawal penalties until age 59½, values in permanent life insurance are ac-cessible to you without waiting. Further, with a life insurance pol-icy, withdrawals or loans are not required after age 70½ if they are not needed.

•The income tax-free deathbenefit can provide a ready source of funds for surviving family members to meet their

income needs in the event of the business owner’s death.

•Althoughpremiumsarepaidwith after-tax dollars, these dollars may be deductible to the company as compensa-tion for C corporation owner-employees (and non-owner key employees).

Keep in mind each individual’s financial needs are unique. Bor-rowing from a life insurance policy or surrendering coverage to access a policy’s cash value may not make sense for everyone. On the other hand, a permanent life insurance policy can protect your family and offer you options.

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equipmeNt iNdustrY NeWsretiremeNt

John Deere’s buying spree over the past few weeks is a strong signal that the largest farm equipment maker in the world is looking to further differentiate itself when it comes to advanced agricultural technology. The company acquired Monosem, a manufacturer of precision planters on Nov. 2, and Precision Planting, a developer of advanced technology and systems for the precise seed spacing and depth placement control to increase crop yields, on Nov. 4. (Please also see “Deere to Acquire Monosem Precision Planters”.) None of this should come as a surprise. As Ag Equipment Intelligence reported in its September issue, following his visits with top managers of AGCO, CNH Industrial and John Deere at the 2015 Farm Progress Show, Morningstar equity analyst Kwame Webb highlighted three major areas of emphasis by the major farm equipment makers. The most noticeable was the growing level of investment in telemetric and precision farming technology. He said during a recent earnings call, he was surprised when Deere revealed that its telemetric research and

Deere Looking for precision Farming Edge with Recent Acquisitions

OVERSTOCK

Ag Equipment sales Decline Eases North American large Ag equipment sales continued to decline in October, according to the latest numbers released by the Assn. of Equipment Manufacturers. “The good news is that sales of smaller farm tractors jumped considerably compared to September, and the numbers are back in line with what we saw earlier this year,” said Charlie O’Brien, AEM senior vice president. “Agriculture is cyclical, and we’re in a cycle right now that’s come down from a pretty high level, which makes it even more challenging. We anticipate a flattening of the rate of decline of the large tractor sales, and the long-term projection for the industry iscertainly very positive,” he said.

~ AEI

8 Ag Equipment Intelligence/November/2015

essentially, we’ve acquired everything up through that monitor,” said Reed.

FieldView is described as a high definition mobile mapping tool that provides real-time detailed data — seed placement and depth — to the farmer as he’s planting.

“The third piece is we’ve also engaged in an API [application programming interface] agreement with them where customers will actually have the oppor-tunity to choose how and where they connect and where they want to send their data to,” said Reed.

Big Concerns. The announcement stirred up consternation for dealers and competing manufacturers as Precision Planting had working agree-ments with Case IH and AGCO, as well as dozens of smaller independent precision farming dealers. According to Sean Arians, spokesperson for Precision Planting, the company is working with more than 400 dealers of nearly all equipment brands as well as independent retailers.

The initial concern, whether Deere would maintain and support the prior agreements, was answered quickly with a definitive “yes.” Reed told AEI, “We’ll maintain each of those exist-ing dealer contracts. Our intent is to maintain that Premier Dealer network in the industry.”

According to Deere spokesperson Barry Nelson, Precision Planting’s portfolio complements John Deere’s planting products with solutions that can be retrofitted to other brands and to earlier models of planters. Precision Planting will operate inde-pendently, but will now be a wholly owned subsidiary of John Deere. “We intend to provide Precision Planting products to other OEMs, advancing John Deere’s strategy to create more choices for customers and expand the industry’s use of precision ag technologies,” Nelson said.

Continuing to service other OEMs and non-Deere retailers is clearly in the company’s best interest, the linger-ing question is how long will Case IH, the number two largest manufacturer of ag machinery, want to continue con-tributing to its chief rival’s revenues.

CNH Response. Responding to Deere’s acquisition of Precision Planting, Dan Danford, spokesper-

son for Case IH, told AEI, “The agree-ment between CNH Industrial and Precision Planting that licenses the use and supply of certain compo-nents at a competitive cost are not impacted by the change of control of Precision Planting. Also, our agree-ments with Precision Planting pro-vide select CNH Industrial dealers the opportunity to carry Precision Planting components as part of their aftermarket parts offering. And just as with the component supply agree-ment, CNH Industrial’s rights are contractually preserved under any change of control.”

Regarding CNH Industrial’s plans moving forward, Danford added, “This change of control of Precision Planting does not change our plans to continue to bring additional innovations to the planter market, with announcements planned in the near future.”

Farm Equipment, AEI’s sister pub-lication, polled readers on Nov. 4, the day Deere announced the acquisi-tion, to find out what they thought Case IH’s likely reaction would be. Based on a total of 539 responses, 31% said Case IH should create a similar partnership to the one it had with Precision Planting with another technology source. A nearly identical number, 29%, said the manufacturer should invest in its own proprietary solution. Of the remaining responses, 22% suggested there should be no change and Case IH should continue to contract with Precision Planting, while 17% think Case IH will acquire

another manufacturer or supplier to develop competitive technology.

Upside/Downside. Independent dealers with established business relations with Precision Planting appear split on Deere’s acquisition of Precision Planting.

Steve Cubbage, president of Record Harvest, which provides GPS-based agronomic services, sees the poten-tial of a significant upside to the deal. “One of the things could be the financing arm of Deere, possibly through their Farm Plan. This is total speculation on my part, but if I had to say what could help us as dealers and spread the technology, knowing that we might be able to use some of Deere’s financing vehicles, to imple-ment it, I think it would be awesome.”

In an interview with Agriculture.com, Sauder, who returned to the market with a new company, 360 Yield Center, just over a year ago, sees a downside if Deere isn’t able to maintain an entrepreneurial spirit at Precision Planting.

“If Deere tries to bring too much in-house, I think they’ll ruin the innova-tion and culture we created. We had a tremendous culture of speed and inno-vation. I aimed to bring out 2-3 new products a year and have them in the sweet spot where they would perform for growers. I’ve seen that back off some. When Monsanto took over Precision Planting, there was not that passion. You just didn’t see that drive like an entrepre-neurial inventor has to get the product right and bring it out quickly.”

0 5 10 15 20 25 30 35

How Will CNH Industrial React to Deere’s Acquisition of Precision Planting?

A total of 539 Farm Equipment readers responded to the online poll about CNH Industrial’s reaction to Deere’s acquisition of Precision Planting. There was no clear consensus on how the company should respond, but about 60% said CNH should either invest in its own technology or hook up with another technology provider. Source: Farm Equipment survey

Invest in its own proprietary solution

Acquire another manufacturer or supplier

Create partnership with another technology source

Continue to contract with Precision Planting/Deere

29%

17%

31%

22%

Deere Looking for Precision Farming Edge with Recent Acquisitions...Continued from page 1

development spending is equivalent to what it is spending on large tractor R&D. “This is noteworthy, as Deere’s large tractors are traditionally its highest margin products.”

~ AEI

Deere to Acquire monosem precision seeder Business The owners of Europe’s market leading manufacturer of precision planters — and a major player in the U.S.— have agreed to sell the business to Deere & Co. Ribouleau-Monosem, a privately-held company owned by third-generation descendants of the founder, is based in western France and has operated a U.S. subsidiary, Monosem Inc., in Edwardsville, KS, for 25 years. In a statement, Deere & Co. said it has signed a definitive agreement to acquire Monosem, its four facilities in France and two in the U.S. “Through this action, we continue to build on our leadership position in precision agriculture,” said John May, president, Agricultural Solutions and chief information officer. “Monosem is admired for its innovation and success in precision planter technology. Acquiring this market leader positions John Deere to serve more customers worldwide.”

~ AEI

Ag Equipment Intelligence/November/2015 7

North American large ag equip-ment sales continued to decline in October, according to the latest numbers released by the Assn. of Equipment Manufacturers. “The good news is that sales of smaller farm tractors jumped considerably com-pared to September, and the numbers are back in line with what we saw earlier this year,” said Charlie O’Brien, AEM senior vice president.

“Agriculture is cyclical, and we’re in a cycle right now that’s come down from a pretty high level, which makes it even more challenging. We antici-pate a flattening of the rate of decline of the large tractor sales, and the long-term projection for the industry is certainly very positive,” he said.

U.S. and Canadian large tractor (which includes row-crop and 4WD) and combine unit sales dropped 31% year-over-year in October. This rep-resents an improvement from down 38% in September.

North American combine sales dropped 18.7% year-over-year follow-ing a 25.6% decline in September. U.S. unit sales were down 20.1%, while Canadian sales fared better at –16.8%.

Row-crop tractor sales in North America were down 33.7% year-over-year in October vs. down 40.4% in September. Year-to-date, row-crop trac-tor sales are down 23.7%.

For 4WD t rac tor s , Nor th American sales were down nearly 30% year-over-year in October and have declined 40.4% so far this year. In the U.S., the drop has not been as severe as in Canada with unit sales down 22.9% vs. 44.6% in Canada.

Mid-range tractor sales were in positive territory for the U.S. at up 1.4% in October. In Canada, mid-range tractor sales dropped 25.1% year-over-year in October. Combined, North American sales are down 3.2% year-over-year in October for the catego-ry, an improvement from the 12.5% decrease the prior month.

Compact tractor sales for North America saw a 17.6% year-over-year jump in sales in October, following a 4.7% drop in September.

Ag Equipment Sales Decline Eases

OCTOBER U.S. UNIT RETAIL SALES

Equipment October 2015

October 2014

Percent Change

YTD 2015

YTD 2014

Percent Change

September 2015 Field Inventory

Farm Wheel Tractors-2WD

Under 40 HP 11,469 9,305 23.3 105,443 97,564 8.1 65,586

40-100 HP 5,931 5,851 1.4 50,671 50,830 –0.3 33,048

100 HP Plus 2,717 3,853 –29.5 20,829 27,259 –23.6 10,226

Total-2WD 20,117 19,009 5.8 176,943 175,653 0.7 108,860

Total-4WD 391 507 –22.9 2,562 4,426 –42.1 1,048

Total Tractors 20,508 19,516 5.1 179,505 180,079 –0.3 109,908

SP Combines 457 572 –20.1 4,489 6,938 –35.3 1,397

OCTOBER CANADIAN UNIT RETAIL SALES

Equipment October 2015

October2014

Percent Change

YTD 2015

YTD 2014

Percent Change

September 2015 Field Inventory

Farm Wheel Tractors-2WD

Under 40 HP 1,407 1,645 –14.5 11,116 12,072 –7.9 9,258

40-100 HP 924 1,234 –25.1 4,862 5,768 –15.7 4,497

100 HP Plus 546 1,067 –48.8 3,764 4,979 –24.4 2,325

Total-2WD 2,877 3,946 –27.1 19,742 22,819 –13.5 16,080

Total-4WD 124 224 –44.6 694 1,037 –33.1 326

Total Tractors 3,001 4,170 –28.0 20,436 23,856 –14.3 16,406

SP Combines 342 411 –16.8 1,614 1,914 –15.7 604

— Assn. of Equipment Manufacturers

U.S. UNIT RETAIL SALES OF2-4 WHEEL DRIVE TRACTORS & COMBINES

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

30,000

28,000

26,000

24,000

22,000

20,000

18,000

16,000

14,000

12,000

10,000

8,000

6,000

2015 5 year average


equipmeNt iNdustrY NeWs

Kubota Corp. reported its 6 months earnings ended Sept. 30 on Nov. 5. Revenues for the company increased $600 million dollars or 9.9% from the same time last year to $6.66 billion. Domestic revenues increased $60 million or 2.8% year-over year to $2.12 billion and overseas revenues grew 13.6% to $4.54 billion. Sales of farm and industrial machinery for the company increased 11.1% year-over-year to $5.56 billion and accounted for 83.4% of sales. Kubota says in its earnings report that domestic sales of farm equipment rose primarily in the tractors segment. Overseas sales, especially in North America, rose in compact tractors and mowers, offsetting decreased sales of midsize tractors. Kubota has left its forecast for revenues for the year ending Dec. 31 unchanged, but has updated its forecast for operating income to $1.41 billion, an increase of $70 million from the previous forecast.

AGco Takes Big hit on south American sales During 3q AGCO reported third quarter results Oct. 28 with net sales for the quarter down 19.4% year-over-year to $1.7 billion. The company also reported it has lowered its inventory by $305 million compared to the same time in 2014. Despite the year-over-year declines, an analyst for Seaport Global said in a note to investors that they continue to be impressed by AGCO’s execution on margin in recent quarters, given the substantial declines in agricultural markets. That said, barring a drought in a major growing region, he believes crop price risk is to the downside given the large expected soybean crop in Brazil combined with initial forecasts for the 2016 corn and soybean crops. (AEI) CNHI Cuts NAFTA, Latin Am Production in 3Q CNHI reported third-quarter earnings Oct. 29 with net sales down 25% year-over-year to $5.5 billion. Revenues of ag equipment fell 33.6% to $2.4 billion. North American sales in the row-crop sector fell 37% year-over-year, but the under 40 horsepower tractor segment and the 40-140 horsepower segment were less volatile at up 8% and down

2% respectively. “The third quarter represented a continuation of what we’ve seen so far throughout 2015, a tough agricultural environment, with unit demand down 33% year-to-date in row crop, NAFTA and more than 25% in Latin Am, which has demanded some heavy lifting actions from the group with production curtailments of 50% in NAFTA and almost 40% in Latin Am, to adjust inventory to prevailing market demand,” said Rich Tobin, CEO of CNH Industrial.

~ AEI

Another Tough quarter forAg Equipment makers


The latest round of quarterly earnings reports continue to indicate tough sledding for ag equipment companies with low expectations for the remainder of 2015.

AGCO Takes Big Hit on South American Sales During 3Q

AGCO reported third quarter results Oct. 28 with net sales for the quarter down 19.4% year-over-year to $1.7 billion. The company also reported it has lowered its inven-tory by $305 million compared to the same time in 2014.

Despite the year-over-year declines, an analyst for Seaport Global said in a note to investors that they con-tinue to be impressed by AGCO’s execution on margin in recent quarters, given the substantial declines in agricul-tural markets. That said, barring a drought in a major grow-ing region, he believes crop price risk is to the downside given the large expected soybean crop in Brazil combined with initial forecasts for the 2016 corn and soybean crops.

AGCO 3Q 2015 (in millions $)

3Q15 3Q14 % Change

North America $494.9 $531.3 –6.9%

South America $231.4 $455.0 –49.1%

Europe/Africa/Middle East $894.3 $1,026.0 –18.7%

Asia/Pacific $115.8 $142.5 –19.4%

Total Net Sales $1,736.4 $2,154.8 –19.4%

CNHI Cuts NAFTA, LatAm Production in 3QCNHI reported third-quarter earnings Oct. 29 with net

sales down 25% year-over-year to $5.5 billion. Revenues of ag equipment fell 33.6% to $2.4 billion. North American sales in the row-crop sector fell 37% year-over-year, but the under 40 horsepower tractor segment and the 40-140 horsepower segment were less volatile at up 8% and down 2% respectively.

“The third quarter represented a continuation of what we’ve seen so far throughout 2015, a tough agricultural environment, with unit demand down 33% year-to-date in row crop, NAFTA and more than 25% in LatAm, which has demanded some heavy lifting actions from the group with production curtailments of 50% in NAFTA and almost 40% in LatAm, to adjust inventory to prevailing market demand,” said Rich Tobin, CEO of CNH Industrial.

CNHI 3Q 2015(in millions $)

3Q15 3Q14 % Change

Total Ag Net Sales $137.0 $433.0 –6.8%

Total Industrial Net Sales $5,549 $7,403 –25.0%

North American Compact Tractor Sales Offset Drops in Other Sectors for Kubota

Kubota Corp. reported its 6 months earnings ended Sept. 30 on Nov. 5. Revenues for the company increased $600 million dollars or 9.9% from the same time last year to $6.66 billion. Domestic revenues increased $60 million or 2.8% year-over year to $2.12 billion and overseas rev-enues grew 13.6% to $4.54 billion.

Sales of farm and industrial machinery for the com-pany increased 11.1% year-over-year to $5.56 billion and accounted for 83.4% of sales. Kubota says in its earnings report that domestic sales of farm equipment rose pri-marily in the tractors segment. Overseas sales, especially in North America, rose in compact tractors and mowers, offsetting decreased sales of midsize tractors.

Kubota has left its forecast for revenues for the year end-ing Dec. 31 unchanged, but has updated its forecast for operating income to $1.41 billion, an increase of $70 mil-lion from the previous forecast.

Kubota Corp. Current Quarter 2015 (in millions $*)

6 Months Ended Sept. 30,

2015 2014 % Change

Farm Equipment & Engines Revenue $4,610 $4,170 10.5%

Total Revenue $6,660 $6,060 9.9%*Converted from yen to U.S. dollar at exchange rates as of Nov. 12

Alamo Sees Slight Uptick in Ag Sales During 3Q Despite Current Headwinds

On Nov. 4, Alamo Group, manufacturer of specialty ag equipment, announced net sales were down. 1.4% for the third quarter at $231.6 million vs. $234.8 million for the third quarter in 2014. Despite headwinds, sales in the agri-culture and industrial segment were up for the quarter. The company experienced a record sales for the first 9 months of $655.1 million and record net income for the quarter of $31.8 million.

The Agriculture Division reported net sales of $58.92 million in the third quarter, a slight increase vs. the $58.87 million achieved in 2014. For the first 9 months, the divi-sion’s net sales were $58.3 million, a drop of 1.8% com-pared to the same period last year.

Alamo Group 3Q 2015 (in millions $)

3Q15 3Q14 % Change

Net Sales $231.6 $231.6 –1.4%

Another Tough Quarter for Ag Equipment Makers

Bonus Section


The latest round of quarterly earnings reports continue to indicate tough sledding for ag equipment companies with low expectations for the remainder of 2015.

AGCO Takes Big Hit on South American Sales During 3Q

AGCO reported third quarter results Oct. 28 with net sales for the quarter down 19.4% year-over-year to $1.7 billion. The company also reported it has lowered its inven-tory by $305 million compared to the same time in 2014.

Despite the year-over-year declines, an analyst for Seaport Global said in a note to investors that they con-tinue to be impressed by AGCO’s execution on margin in recent quarters, given the substantial declines in agricul-tural markets. That said, barring a drought in a major grow-ing region, he believes crop price risk is to the downside given the large expected soybean crop in Brazil combined with initial forecasts for the 2016 corn and soybean crops.

AGCO 3Q 2015 (in millions $)

3Q15 3Q14 % Change

North America $494.9 $531.3 –6.9%

South America $231.4 $455.0 –49.1%

Europe/Africa/Middle East $894.3 $1,026.0 –18.7%

Asia/Pacific $115.8 $142.5 –19.4%

Total Net Sales $1,736.4 $2,154.8 –19.4%

CNHI Cuts NAFTA, LatAm Production in 3QCNHI reported third-quarter earnings Oct. 29 with net

sales down 25% year-over-year to $5.5 billion. Revenues of ag equipment fell 33.6% to $2.4 billion. North American sales in the row-crop sector fell 37% year-over-year, but the under 40 horsepower tractor segment and the 40-140 horsepower segment were less volatile at up 8% and down 2% respectively.

“The third quarter represented a continuation of what we’ve seen so far throughout 2015, a tough agricultural environment, with unit demand down 33% year-to-date in row crop, NAFTA and more than 25% in LatAm, which has demanded some heavy lifting actions from the group with production curtailments of 50% in NAFTA and almost 40% in LatAm, to adjust inventory to prevailing market demand,” said Rich Tobin, CEO of CNH Industrial.

CNHI 3Q 2015(in millions $)

3Q15 3Q14 % Change

Total Ag Net Sales $137.0 $433.0 –6.8%

Total Industrial Net Sales $5,549 $7,403 –25.0%

North American Compact Tractor Sales Offset Drops in Other Sectors for Kubota

Kubota Corp. reported its 6 months earnings ended Sept. 30 on Nov. 5. Revenues for the company increased $600 million dollars or 9.9% from the same time last year to $6.66 billion. Domestic revenues increased $60 million or 2.8% year-over year to $2.12 billion and overseas rev-enues grew 13.6% to $4.54 billion.

Sales of farm and industrial machinery for the com-pany increased 11.1% year-over-year to $5.56 billion and accounted for 83.4% of sales. Kubota says in its earnings report that domestic sales of farm equipment rose pri-marily in the tractors segment. Overseas sales, especially in North America, rose in compact tractors and mowers, offsetting decreased sales of midsize tractors.

Kubota has left its forecast for revenues for the year end-ing Dec. 31 unchanged, but has updated its forecast for operating income to $1.41 billion, an increase of $70 mil-lion from the previous forecast.

Kubota Corp. Current Quarter 2015 (in millions $*)

6 Months Ended Sept. 30,

2015 2014 % Change

Farm Equipment & Engines Revenue $4,610 $4,170 10.5%

Total Revenue $6,660 $6,060 9.9%*Converted from yen to U.S. dollar at exchange rates as of Nov. 12

Alamo Sees Slight Uptick in Ag Sales During 3Q Despite Current Headwinds

On Nov. 4, Alamo Group, manufacturer of specialty ag equipment, announced net sales were down. 1.4% for the third quarter at $231.6 million vs. $234.8 million for the third quarter in 2014. Despite headwinds, sales in the agri-culture and industrial segment were up for the quarter. The company experienced a record sales for the first 9 months of $655.1 million and record net income for the quarter of $31.8 million.

The Agriculture Division reported net sales of $58.92 million in the third quarter, a slight increase vs. the $58.87 million achieved in 2014. For the first 9 months, the divi-sion’s net sales were $58.3 million, a drop of 1.8% com-pared to the same period last year.

Alamo Group 3Q 2015 (in millions $)

3Q15 3Q14 % Change

Net Sales $231.6 $231.6 –1.4%

Another Tough Quarter for Ag Equipment Makers

Bonus Section

North American compact Tractor sales offset Drops in other sectors for Kubota

Blount Reduces productionRates to match Declining sales On Nov. 9, Blount International, manufacturer of replacement parts, equipment and accessories for the forestry, lawn and garden and ag industries, reported third quarter sales of $209 million, down 15% compared to the prior year. The Farm, Ranch and Agriculture segment (FRAG) third quarter sales drop 9.6% to $71.1 million vs. the third quarter of 2014.

~ AEI

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