Fencepost brings big ticket savings to farmers

Fencepost brings big ticket bulk buying savings to farmers

Farmers in the market for a rotary milking machine can save up to $32,000 by taking advantage of a pilot bulk buying scheme launched by leading agricultural website Fencepost.com.

The scheme involves Fencepost acting as a conduit to aggregate member demand for a limited number of high value products and leveraging the demand to negotiate bulk purchase prices.

The first offer under the pilot scheme is for a new 50 bale rotary milking machine from Waikato Milking Systems offered exclusively to Fonterra Farmers with discounts of up to 22 per cent.

Fencepost CEO Kris Nygren says the offer is available until the end of October and is limited to a maximum of 20 units.

"The discount levels are dependent on the number ordered - if reservation fees are paid for between 16 and 20 units the discount amounts to about $32,000 on a $146,000* milking system."

Discounts levels are 8.3 per cent for between two and five units reserved, 13.8 per cent for six to 10 units and 18.6 per cent if 11 to 15 units are reserved.

Kris Nygren says interested parties need to register online at www.fencepost.com and pay an $800 reservation fee. If five or fewer farmers register, the reservation fee will be refunded.

The fee is paid to Waikato Milking Systems which has agreed to sell the milking unit at a discount based on the number of reservations, not just sales.

"Aggregation is a common approach to economies of scale and leveraging Internet technologies is a very efficient way of carrying it out," says Mr Nygren.

"Successful demand aggregation ventures invariably have a very strong affiliation with a buying group or an outstanding offer. The vendor partners get the benefits of bulk orders and low marketing costs leading to lower cost of sale and bigger order volumes."

Mr Nygren says the timing of the current offer is extremely good for farmers and a very good fit for Fencepost. "Farmers are coming off a reasonable year and dairy systems are traditionally bought around September, October and November for new year installation.

"It is a pilot offer and if it's successful we'll definitely be looking at other aggregation opportunities for our members."

The 50 bale Waikato Milking System rotary milking machine offer includes Waikato Xtra electronic cup removers, G2 cluster washers with flow control, lightweight Waikato 320 claws, automatic system drains among other specifications.

About Fencepost.com: Fencepost.com is a gateway to rural New Zealand and the country's leading agricultural website. It provides world-class Internet-based resources to help farmers manage their businesses and businesses manage their online activities. Services include farm management tools and portal, technology and e-business services. Fencepost is a wholly-owned subsidiary of Fonterra Co-operative Group, New Zealand's biggest company with a staff of more than 20,000, totals assets of NZ$11.8 million and turnover of just under NZ$14 billion.

* All figures are GST exclusive.

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