Active membership spurs growth

26 April 2002




Active membership spurs growth

The Norfolk and Waveney

machinery ring has seen

its member activity and

turnover rise consistently

over the past three years.

Andy Moore finds out why

CONCENTRATING on core business is the key to retaining a high member activity and turnover, insists the Norfolk and Waveney machinery ring.

Located at Loddon, the rings mainstay services are sourcing and supplying labour and machinery for root and cereal stubble to stubble operations.

"The types of farming and farm sizes vary greatly in our area which has led members to demand and supply a wide range of machinery," says manager Stuart Naunton. "Membership activity has increased over the past two years mainly due to a high demand for machinery for carrying out fire brigade work on wet ground conditions."

Impressed with the service under testing times, it left inactive members wondering how much more the ring could do for them in a trouble-free season.

Out of the 354 members, 250 are active, while 120 use the ring on a continuous basis to source and supply equipment for arable operations.

Another factor resulting in greater member activity is a steady increase in farms relying on contractors to carry out specialist root crop work.

"One of our members manages 1800 acres of potatoes over a 50 mile radius using his van and a farm office," says area manager Grayam Peters. "He uses the ring for men and machinery to undertake most of this operation including cultivation kit, planters and harvesters."

Also increasing member activity is a handful of 404ha (1000 acre) farms which have merged, sold some of their kit and use the ring to top up their labour and tackle requirements.

Mr Peters says some of these units turn to the ring because they get their sums wrong investing in large shiny new kit which is under-used.

But while large arable farms generate a lot of business, smaller units can play a bigger part in providing labour, says chairman Simon Watchorn.

"A number of smaller farms have men and machines hanging around which could be employed more usefully on other units," he says.

"The supplier makes a bob or two hiring out a tractor and driver who enjoys overtime pay, while the demander has flexible part-time labour."

Daunted by the cost of setting up an in-house agency, Mr Watchorn believes the ring has an under-used pool of labour which could be exploited better by both demander and supplier.

Labour makes up about 10% of the rings turnover which has increased from £504,700 in 1999 to £820,000 for the first nine months of the 2001/02 financial year.

But the ring has not entered the commodity supply market, although many of its members purchase goods through the Loddon Farmers buying group which is run as a totally separate entity.

"Supplying commodities would create too much paperwork and downtime which would hamper our core business services," says Mr Watchorn.

"Our aim is to keep the ring as simple as possible. The last thing we want to do is alienate members in the event of a supply service going wrong."

A no nonsense approach is also applied to commission fees which remain at 2% and subscription at £70.

In an attempt to retain member loyalty and repeat business, larger ring users are currently eligible for a rebate scheme.

Those who contribute £5000 to the rings turnover as supplier or demander (separately) are entitled to a 5% rebate which rises on a sliding scale to 50% returned at £50,000.

"Repeat business is the bread and butter of our turnover and enables us to concentrate on more obscure and smaller demands," says Mr Naunton. "The rebate scheme encourages members to put more lucrative work through the ring which take less organising and eliminates the risk of it being done through the back door."

Work done outside the ring is kept to a minimum by Mr Naunton and Mr Peters putting themselves among members on a constant basis.

Mr Naunton says one-to-one communication builds up trust between the member and ring which can then be better informed of their requirements.

"Members are not good at keeping us up to date if they have changed their machinery, so it pays to go and speak to them in person," he adds. "We are here to help members run their businesses as smoothly and economically as possible." &#42

NORFOLKANDWAVENEYMACHINERYRING

Base 13 Bridge Street, Loddon, Norwich, NR14 6LY (01508-520541).

Chairman Simon Watchorn. Ring manager Stuart Naunton.

Operating area Norfolk and the Waveney Valley area of north Suffolk.

Activities Labour and machinery hire and contracting services.

Members 354.

Fees £20 share, £70 annual subscription, 2% commission with a rebate system returning up to 50% of commission to the bigger users.

Member activity 70%.

Total turnover £504,700 in 1999; £660,423 in 2000; £813,540 in 2001; £820,000 in the first nine months of 2002.

Most popular services Hire and supply of machinery for all root crop and cereal growing operations.


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