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Partnering and Expanding with Vermeer

Partnering and Expanding with Vermeer

11 Jun 2018 Read time: 6 min

While people often know that RDO Equipment Co. started out as a John Deere dealer, some are not aware of RDO’s deep, long-standing relationship selling and servicing products from Vermeer Corporation.

Vermeer — a world-leading manufacturer of agriculture, construction, surface mining, tree care, organic recycling, and wood waste processing equipment — is based in Pella, Iowa. In 1991, RDO acquired a John Deere construction store in Burnsville, MN, that also included a Vermeer dealership.

During the next few years, the RDO-Vermeer relationship grew. Early in the relationship, Vermeer wanted to be sure that RDO Equipment recognized the value of the partnership with Vermeer and gave them the same attention that signified RDO’s strong relationship with John Deere. RDO recognized that and wanted to provide Vermeer the identity it wanted similar to other dealers. In 1997 RDO built a new standalone facility in Burnsville for the Vermeer division that significantly enhanced the relationship almost overnight.

 “We really had to figure out how to work together,” says Skip Klinkhammer, who was general manager of the Vermeer store in Burnsville and served as RDO’s liaison with Vermeer in those early days. “There was a lot of potential to do great things together, but it took some time to understand what was really important to each organization. Once we figured that out, things took off!”

While Vermeer was a very successful organization, the RDO model was a different way of working together for Vermeer. All dealerships were owner-operator dealerships and many of them started through a partnership with Gary Vermeer so dealer principals were often hand-chosen by him; they were already Vermeer employees. The model was very successful.

But the RDO model was slowly proving there was another way and sales grew beyond Vermeer’s expectations. “In that way, our relationship worked,” Klinkhammer said. “The best compliment that we could have received was when Bob Vermeer (CEO and son of the founder) said that RDO proved to them that RDO could be a true Vermeer dealer and be a top performer.”

The hard work on both sides during those early years built the foundation for the way the businesses work together today.

“Working with RDO through the decades has been a special partnership,” said Mary Andringa, Chair of the Board for Vermeer. “In our early days of working together, Vermeer and RDO developed a good transparent relationship. As I worked with (founder) Ron Offutt, I continued to ask for a true focus on Vermeer.  We had many discussions through the years on how to work out that focus.  And as our partnership and trust grew, we were glad to grow the RDO representation in more territories for Vermeer. We look forward to continuing our work together in the future.”

When Klinkhammer went to lead the operations in Burnsville, the Vermeer division had three employees, but the business did provide limited parts and service support in Sauk Rapids and Rochester. Those parts and service operations turned out to be successful and kept growing, and RDO kept pushing on Vermeer to let it do more of them. Parts and service centers were opened in Fargo and Grand Forks. Around that time RDO Equipment Co. began planning to go public. There was a pause in expansion because Vermeer was not completely supportive of that decision. During this time RDO purchased Mankato and Vermeer parts and service was added to that store.

When RDO went public, Vermeer was worried the relationship would change. During RDO’s public years, RDO didn’t acquire any new Vermeer stores. However, during this time Vermeer allowed RDO to open parts and service centers in Bismarck and Minot as well as Marshall (Minnesota). The fiber (cable) business was just beginning to explode and Vermeer wanted to capture that business with RDO.

In 2003, after several tumultuous years in the public sector, RDO made the decision to go private once again. Within 30 minutes of word being out, Mary Vermeer (CEO at Vermeer) called Ron Offutt expressing how pleased Vermeer was at that decision.

In October 2004, RDO acquired stores in California that sold and serviced Vermeer equipment. In 2005, RDO acquired another Vermeer branch in Portland, OR.

In 2006, Klinkhammer returned to Fargo to become the Vice President of the Vermeer Division.

In 2009, Vermeer let RDO know that it would be preferable that the RDO liaison with Vermeer be located in California or on the West Coast. Christi Offutt, CEO of RDO Equipment Co., worked closely with Vermeer leadership to choose the RDO executive who would be the next liaison with Vermeer. Later that year, Executive Vice President Marshall Anderson was chosen to lead RDO’s work with Vermeer.

One of the first moves Anderson made was to involve more people within RDO with the Vermeer relationship. He wanted to make sure that both businesses understood each other as well as possible. His early focus centered around three main areas:

  1. To bring the culture of RDO Equipment Co. into RDO’s Vermeer division. He didn’t want team members to see themselves as separate. He wanted them to see be RDO employees who focused on Vermeer as an important manufacturing partner.
  2. To ensure that Vermeer understood that RDO was not just about John Deere. RDO was a business that stood on its own. At the same time, he needed team members across RDO to understand what was important to the leadership and staff at Vermeer headquarters.
  3. To segment sales within the Vermeer product line. Vermeer sells a wide variety of products and Anderson wanted to make sure that RDO sales people were experts in the specific areas so they could best help our customers and other stakeholders.

This approach has led to RDO team members being more deeply involved with our Vermeer customer base as solutions providers. Also, while specific employees may focus on Vermeer, they are RDO employees first, which has helped with recruitment and retention.

“The relationship continues to grow and get stronger,” Anderson said. “Because of the strength of the relationship, Vermeer came to RDO over the last 10 years and asked us to get involved internationally in Australia and Russia. Those are key international markets for them and we are proud that they wanted us to be a part of their efforts.”

That international partnership has been something that has impressed Jason Andringa, President and CEO of Vermeer.

“I’ve appreciated RDO bringing their world-class level of service to their Vermeer customers outside the United States,” Andringa said.  “RDO has continued to raise the bar in customer service domestically and is now doing so internationally as well.”

The RDO-Vermeer relationship has come a long way from that single store in Burnsville more than 25 years ago. And Anderson sees that relationship continuing to grow.

“We’ve come from a point where the sides were initially nervous about each other to a point where we are deeply involved with each other and have great mutual respect,” Anderson said. “They have used us a model on how they work with other dealer networks. On our side, we have really learned how to focus on being a better partner with a manufacturer. It’s a win-win.”

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