‘BeefStar’ Battle : Computers Plant Seeds in Farm Belt
Computer salesman Dave Natof turned his Toyota onto the ice-covered driveway leading up to the white frame farmhouse that is home to the Sims family, which started growing corn, wheat, soybeans, cattle and hogs around here when Abe Lincoln was just a local politician.
Natof’s little car is a traveling salesman’s office, right down to the coffee thermos rolling around on the floor. In the back were cardboard boxes containing his wares: an IBM XT computer, a monitor, a dot-matrix printer, a keyboard, a few boxes of software and a thick instruction manual.
On a previous visit, Natof sold this gear to farmer Randy Sims for $6,000. This time, arising before dawn and driving the 133 miles from Galesburg, Natof installed the system and spent six hours teaching Sims and his wife, Mary Ann, how to use it. He’ll return several more times before planting season; after that, there won’t be time for computer lessons.
Farmer’s Hours
“It’s the price you pay,” said Natof, 26, a former vocational agriculture teacher, who fends off the Sims family dog while lugging the computer across the snow and into the house. “You gotta work a farmer’s hours.”
In the computer business these days, this is what’s known as the front lines.
Having sold machines to all the hobbyists, the computer industry now is trying to persuade small-business owners that personal computers will make them money. Farmers were pegged as the most lucrative market of all. They’re turning out to be a hard sell.
Though they historically have embraced labor-saving technology and made miraculous productivity gains, many American farmers, mired in a severe debt crisis, are casting a skeptical eye at a machine that doesn’t move or make noise. Farm sales of computers have fallen far below the promoters’ early boasts since the push began in about 1981.
Below Expectations
“Anybody who tells you the farm market met his expectations of three years ago . . . is lying through his teeth,” said Robert B. Harris, chairman of Harris Technology Group Inc. of Lincoln, Neb., a 52-year-old agricultural testing and research firm that started publishing farm software called AgDisk in 1981.
But like the tractor and the milking machine before it, the computer is slouching toward Peoria. And it is adding a whole new dimension to the business--and the culture--of farming.
Every computer owner knows about the popular word-processing software program called WordStar. But how about the cow-management program, BeefStar?
More than 120 firms are now publishing at least 800 farm software programs with names like Sow Audit, Secretary of Agriculture and Nutri-Swine. Magazines called AgriComp and Farm Computer News have appeared, and vendors of conventional farm machinery are peddling computers alongside their tractors.
They say that on some Iowa and Illinois farms last fall, the hottest topic of conversation besides the election was the big offer from Vigortone Ag, a livestock feed firm in Cedar Rapids: a fat discount on an IBM PC and a free hog software program to anyone who bought at least nine tons of feed.
So what’s a hog program? It might keep track of hogs’ medical histories and breeding performance, figure feed costs, track weight gains and tell what price an animal must bring to turn a profit.
Livestock Prices
On the Sims farm, before the computer was plunked down on the dining room table the other day, another monitor already glowed green atop the kitchen counter. It flashed the grain and livestock prices from the Chicago and Kansas City boards of trade, updated every 10 minutes; the latest barge and rail-car grain loadings out of St. Louis, and dozens of other indicators that Sims uses to market his own livestock and grain.
“Two years ago I picked up $35,000 out of the (Chicago) board,” Sims said. “That makes a difference.”
With his new computer, Sims could tap over the phone lines into a data base such as AgriData Network in Milwaukee, which contains news stories on things like weather and commodity prices, for $399 a year and $28 an hour.
Meanwhile, he pays $1,300 a year for commodity news and analysis from the Illinois Farm Bureau, a cooperative that gets the signals from a satellite for collection on special FM radio frequencies. The day the computer arrived, workers happened to be installing a small microwave dish on Sims’ roof to get the signals directly from the satellite, improving reception.
“A normal day on the farm,” joked Mary Ann Sims, suddenly surrounded by high-tech gadgetry.
1,300 Acres
The Sims family farms 1,300 acres with Randy’s parents, Melvin and Carol, and his Uncle Dean and Aunt Mary Jane. Randy Sims, 37, is a modern, college-educated, politically savvy farmer who knows the financial break-even point on his hogs, keeps good financial records and subscribes to the Wall Street Journal. Computer or not, when the agriculture shakeout ends, the family partnership known as Sims Farms will almost surely be intact.
They like to say in these parts that a computer won’t turn a bad farmer into a good one; it will just make him a bad farmer faster. It might work the other way too.
The computer stands as a sort of symbolic threshold for making it on the farm these days. Those who see its value tend also to be the ones who already are leaving behind the less sophisticated farmers who know how to grow corn but not how to borrow money, who can raise hogs but don’t notice which animals tend to produce skinny offspring.
Tougher Credit Demands
One of the biggest boosters of computers on the farm is the friendly local banker, who sees it as a tool to clean up farmers’ notorious bookkeeping practices. Lenders are making tougher credit demands of farmers nowadays, including more detailed and up-to-date financial information. But agricultural uses for a computer go beyond the office and into the fields and barns.
In Goleta, Calif., 64-year-old Glenn Parks has a Radio Shack computer to do the accounting and, as of last year, an Apple IIe hooked up to sensors buried around his 600-acre avocado ranch. The Apple system not only tells him when to irrigate which trees, but automatically turns the irrigation valves on and off. The idea is to trim his water bill, which can exceed $200,000 in a dry year.
Parks is unequivocal: “It’s out of this world. It’s a huge step forward. In past years, we were doing this by the seat of our pants. In order to make sure they were getting enough water, we were giving them too much.”
Now, researchers at UC-Riverside are “teaching” Parks’ computer to anticipate pest infestations by interpreting soil and weather conditions. The same system could be programmed to activate anti-frost machinery in cold weather. The system cost about $10,000 to connect the first 40 acres, the Apple included, and Parks is preparing to wire 70 more acres for another $5,000.
Monitor Pregnancies
Computer-connected sensors can be implanted in animals to monitor pregnancies or in barns to activate feed mixers. Physicist-farmer Lynette Roth of Oxnard, Calif., who designed and sold the system to Parks, said in-ground sensors could tell Midwest growers when to begin fertilizer programs, among other things.
All the wondrous possibilities help explain the euphoria that gripped the computer industry a few years ago and sent hundreds of agriculture-based companies scurrying to get in on the action.
“Everyone said, ‘Let’s see, there are 2.5 million farmers. Gosh, if we sold $10,000 worth of computers to just 10% of them, wow! That’s $2.5 billion!’ ” agribusinessman Harris recalled.
An odd assortment of computer retail operations and services sprouted in haphazard fashion across the breadbasket. Feed companies, farm-machinery manufacturers, farm co-ops and individual farmers have become dealers of computer hardware and software, with mixed success.
Value-Added Dealer
Salesman Natof works for the Illinois Farm Bureau, which is what’s known in the business as a value-added dealer of IBM computers. Rather than operate out of storefronts, the bureau dispatches computer salesmen to farmhouses for personalized sales pitches and as much as 50 hours of customized lessons. The venture has grown from three outlets to eight and expanded into Indiana and Pennsylvania.
By contrast, John Deere & Co. got out of the computer-retail business last year after a short-lived experiment at six of its dealerships in which computers and software were sold alongside tractors and combines. The company said it didn’t sell enough systems to make it worth the dealers’ time.
At Frank Implement Co. of Scottsbluff, Neb., owner Roger Frank said he sold five or six systems in nine months. He usually pressed his office accountant into service to talk with customers because he understood the computers better than “the salesmen who know about tractors.”
“Farmers are interested, but they’d come at us with a lot of technical questions and we were really unable to answer them,” Frank said.
Separate Stores
When the people at Valmont Industries Inc. in Valley, Neb., started selling IBM computers in about 50 of their irrigation-equipment dealerships in 1982, sales were so good that the company started establishing stand-alone retail stores in small towns under the name ValCom. Now, with more than 160 stores, ValCom is the fourth-biggest chain of computer specialty stores behind the better-known ComputerLand, Radio Shack and Entre chains.
But ValCom’s success merely underscores the difficulties of selling computers for the farm. It wasn’t farmers who bought all those computers from ValCom, but the other small-business and professional people in rural America. Farmers account for fewer than 10% of ValCom’s sales.
Said President Bill Fairfield: “Frankly, our original charter was to focus on farmers. On balance, (farm sales) have not met our expectations. All the projections I’ve read have been too optimistic.”
Farmer Turned Salesman
Farmer Wayne Wangsness of Decorah, Iowa, discovered this in ironic fashion.
Wangsness bought his first computer in 1978 and brought its analytical powers to bear on his cattle and grain farm. The machine told him his livestock business would remain in the red for years. Wangsness sold it, sharply scaled back his grain operation--and used the proceeds to open a computer store.
“It has yet to prove a smashing success,” he said of his computer store. “It has not proven to be a very good market at all. I failed to anticipate things would get so bad in the farm economy as fast as they did.”
Some doubt the need for a computer on small or medium-size farms, where the owner might be better off buying outside computer services. Farmer Joe Blair of Winslow, Ill., sold his Radio Shack computer to his sister after three years because he wasn’t using it much. If he personally performed all the computer services he now buys from his bank and a feed company, Blair said, he wouldn’t have any time left for farming.
“If a computer makes a farmer bring his books up to date, it’s worth it,” Blair said. “But I was doing that all along.”
3% Penetration
There are no good statistics on how many farmers have personal computers; surveys suggest the penetration is anywhere from 3% to 10%. Successful Farming magazine, in trying to lure advertisers to a new computer publication, said 11% of its readers have computers and that 80% plan to buy them by 1990.
ValCom’s Fairfield thinks that 80% of the “legitimate base” of farmers--the 800,000 to 1 million modern, full-time farmers as distinct from the majority of farmers, who do it part-time--will be using computers by 1988.
The poor state of the farm economy has unquestionably hurt sales of computers, which farmers have gotten along without for several thousand years. For the $6,000 that Randy Sims paid, one could instead buy a 150-horsepower used tractor at one of the frequent farm sales that characterize today’s hard times in the grain belt.
But some also blame manufacturers and dealers for pushing unnecessarily costly and complex systems on farmers. Others say the early agricultural software wasn’t any good.
‘Hands-On Folks’
“They don’t need a $9,000 system,” said Harris. “These are hands-on folks. They need some simple software to start with that tells them whether they should sell some grain today or store it.”
The tough market deters some, but not others. For every firm that pulls out, another enters: Sperry Corp., the big computer firm, is entering the farm market this year through its New Holland farm-implement unit. And Pioneer HiBred International Inc., a big Des Moines seed company, just began selling computers and software in its neck of the woods.
Like many others with a stake in farm computers, Wangsness, the farmer-turned-computer dealer, is unbowed and awaiting the farm recovery.
“The farmers that are left are going to need computers,” he said flatly. “They’re going to be the ones who pay attention to their accounting and watch their cash flow. They’ll be interested in computers as soon as they can find some money to buy ‘em.”
