Outstanding in the Field Podcast


Join Mike Terning as he has candid conversations with key participants at the 2019 AGRO Conference. Greg Miller with Miller & Associates is the creator of ExamNet and ExamHand which are two well-known grain industry oversight and grain measuring software programs. Jeff Reardon is a Finance Specialist with White Commercial Corporation and provides financial consulting services for CFOs of grain elevators across North America and Canada. Tune in for interesting perspectives (LIVE from AGRO’s annual conference in Savannah, GA!) on the current state of the grain industry, and how each play a role in its success.

What you will learn in these episodes:

  • What AGRO is and what role it plays in the U.S. grain industry
  • What AGRO EDI is why it’s important
  • What ExamNet and ExamHand are and how they assist grain auditors
  • Who White Commercial is and how they work with grain elevators across North America and Canada

Relevant links:

Listen to the podcast:

Click HERE for Greg Miller’s interview.

Click HERE for Jeff Reardon’s interview.



Mike Terning:     Welcome to another episode of Outstanding in the Field. Today I have the privilege with speaking with Greg Miller. I’ve known Greg for a few years, and I’m excited to hear what he has to inform our audience today about. So Greg, could you please introduce yourself?

Greg Miller:   Be glad to Mike. My name’s Greg Miller. I’ve been self-employed in the ag industry since 1990. I started out in grain software. In fact, there’s a touch point clear back in the 1980s where I worked with vertical software. We were often toe to toe with Dan Berg and Joe Price way back in the early days of PCs. So after my time at vertical, I went to a company called Comptrol, which was based in Indianapolis. I worked with Indiana Farm Bureau. Again, with many mainframe type of computing systems. I mean these are the old days you know. While I was there, we got a call from the state of Kansas. A regulatory agency, the warehouse control people. They were looking for a software package for their field examiners. At that time, of course, there were no such thing as a laptop. I became intrigued—I was not happy where I was with working with Indiana Farm Bureau, and I seized on the opportunity. We worked it out where I departed, but I took this one sort of client with me, err almost client. The rest is history. That was 1988 when we actually designed the first ExamHand, if you will, was in 1988 on an old Apple Cube. I don’t know what they called it. The original Macintosh with a one disc for the program and one disc for the data. The examiners lugged those things out in the field and away they went.

So after then it was just a progression. I believe it was the state of Minnesota was next. At that time, laptops started coming in. So we moved over to sort of a PC or MS-DOS type basis. The rest is history from there. Today we have—We just added our 17th state, Wisconsin. We also have our ExamNet product, which works on the industry side. So.

Mike:   Okay. So ExamHand is geared for the examiners themselves.

Greg:  Correct.

Mike:   To help them come in…What do they typically do with ExamHand?

Greg:  Well, what they do is both a traditional what’s called an obligations exam. So most regulatory agencies that oversee warehouses will have an examination process where someone enters the licensee’s facility, checks their bins to make sure—err measures the grain in it, checks that against their obligations, and sees if they’re in compliance in terms of warehousing. If you’re storing grain for somebody else, you need to be in compliance and need to keep their grain in good condition, etcetera. In addition to that, over the last say 30 years, grain dealer laws have come into play where there’s not only warehousing laws, there’s grain dealer laws. So regardless of whether you have a warehouse facility or not, you buy and sell grain, you need a dealer license. The dealer license is more financially oriented. So there’s a financial statement to get started. Our software assists both in the obligations exam and taking it the next step to do more of what we call a working capital exam. And, of course, ancillary things too like check off compliance, audits, little things like that it also does. So it’s sort of a tool kit for the modern grain warehouse examiner.

Mike:   And ExamNet.

Greg:  Right.

Mike:   What does that do?

Greg:  ExamNet is basically a piece of ExamHand that has been split off and used in two different ways. Number one, we thought it was a good idea…Traditionally, grain elevators and grain warehouses have not measured their own grain. I mean traditionally they’ve not been forced to. It was seen as the job of the regulator. They didn’t really care. Their book stocks were good. They didn’t need to measure. We sort of started the idea that maybe some out there would like to have a package that would more consistently—and maybe more importantly—do it the same way the examiners would. So our argument was that hey, you don’t want any surprises when the examiner comes in. Why don’t we give you the examiners toolkit and see what you come up with? That was the original intention.

In 2009, probably the biggest boost we had there is we convinced—you might say—the state of Illinois and later the state of Michigan that this could be a compliance tool that would actually replace the examiners measuring on a routine basis. So since 2009 in Illinois and since 2012 in Michigan, a routine examination does not include measuring grain. It does include auditing, if you will, the ExamNet product. Because there was no commercially easily available products out there to do it, both states were convinced that they did the licensing on the software on behalf of their industry. So the way the licensing agreement works is the license is with the state of Illinois and the state of Michigan. They are free to then distribute this software to any licensee in their state. So that’s the way it works.

Mike:   So both of them are licensed to the state examiners.

Greg:  Correct, correct.

Mike:   But ExamNet can actually be put in the hands of a licensee, a grain elevator, a co-operative, or whomever is holding that license to handle or store grain.

Greg:  Right.

Mike:   They use it to do their own measure ups.

Greg:  That is correct.

Mike:   That’s interesting.

Greg:  Yeah. We also have some of the big ABCD as you might [inaudible], but the ABCD, I guess, is how it goes. We have several clients as well that have deployed this enterprise wide. So that’s an exciting new kind of angle for us.

Mike:   Okay. Wow. Well, that’s quite a journey you’ve been on.

Greg:  Keeps me busy.

Mike:   Yeah. Where did you get your programming chops?

Greg:  I really developed those in college, but I’m not a trained computer scientist. I’m an economics major. I have a master’s degree in ag economics. So more or less it was along the way as those basic and things like that were evolving that I learned to do it. So I’m sort of self-taught in terms of that.

Mike:   Okay.

Greg:  So we basically learned what we needed to do to make it happen. So.

Mike:   Interesting. So master’s in econ from where?

Greg:  U of I. University of Illinois.

Mike:   Okay. Undergrad, same place?

Greg:  No. Undergrad at SIU, Southern Illinois University in Econ. Yeah.

Mike:   Okay. That’s in Carbondale?

Greg:  Carbondale. You got it.

Mike:   Alright. Well, good. Well thanks for that background. It’s interesting who you serve. We’re actually sitting in Savannah, Georgia overlooking the Savannah River and a big vessel is going by right now.

Greg:  As we speak.

Mike:   Yes. That’s interesting. It’s hauling boats.

Greg:  Yeah. Yeah. A boat hauling boats.

Mike:   Yeah, yeah. That’s right. We’ve been meeting at the annual AGRO convention, which is the Association of Grain Regulatory Officials. You had a speaking presentation today that I enjoyed. Why don’t you inform the audience what you were speaking about today?

Greg:  Well, today we were just recapping—Again, as I alluded to, some states do obligations exams and that’s it, but there’s a lot of curiosity out there among those that do only obligations exam what a working capital exam is like, going a little bit further. Of course, the pressures against that are time and money. So you have to weigh the risk versus the reward. My personal opinion is that we spend too much time measuring grain and we should be spending more time looking where I believe the risk is, which is in the financial side of it. There’s not too many failures. In fact, we’ve analyzed every failure in Illinois in the last 20 years. Really none of them were materially affected by the inventory, whether it was there or not. Because the amounts of money we’re talking about that can be generated from the financial side from options, from misplaced futures, from speculation, from all these things are way, way more than one house full of grain. That’s a very finite amount of loss. Whereas the other thing can get out of hand quickly.

Normally nowadays when you see failures that are relatively low amounts of money—let’s say less than $2 million—most of them are worked out. That is a potential buyer will come in and take over the facility. They’ll be a little bit of stress. Maybe they’ll let the regulator know. They’ll see this coming and work at it. The problem ones are the ones that involve fraud or involve foul play to the extent that you get multi-tens of millions of dollars. These are the ones that are really, the ones that you need to focus on. A working capital exam can help expose that. I mean an obligations exam is almost, you’re almost flying blind. So.

Mike:   So you’ve been doing this for about three decades. What progress, what trends have you seen in the industry with the customers—which are primarily regulators that you serve. What have you seen?

Greg:  Well, the regulators in general, the first half—let’s say—of this 30 year period were very much farm people. They were very dedicated, and they did not move. They stayed there for…So you develop a certain institutional knowledge and whether that’s maybe sometimes good, sometimes not so good. But you develop that. I think what’s happened over the last 10 years is it’s just become more of a, you might say, a regular state agency. Not a special one. It used to be kind of special in terms of the ag. Now we’re getting a lot of people that don’t have an ag background—and this is the same for all ag jobs really. I mean it’s a megatrend. So that is a trend where that kind of goes along with our no measure thing because the measuring process is specialized. People don’t like heights. They don’t like climbing bins. So they lose a lot of candidates because of that.

So in Illinois, for example, the retirees slowed down when we stopped measuring. The guys will work longer because the job’s not quite as physical as it was. So that was seen as a benefit because we kept our knowledge there a little bit longer.  In terms of, obviously, just the same as in your business. The elevators are getting bigger. They’re getting more sophisticated, and they’re creating bigger messes. They can create a bigger mess. So the importance of management and oversight, especially when you’re handling facilities that are so far apart. It’s not just down the road anymore. Now they’re in other states. It’s becoming more important, but I think the industry is stepping up to the challenge. I think it’s much more sophisticated. It’s still interesting though as different states are different.

For example, if you compare the inventory of elevators, over a thousand elevators in Illinois, 1.4 billion bushels of capacity. Compare that to Missouri which has 250 or so. Maybe 200/300 million. It’s amazing that two states right next to each other can be that different. Much more small operators, etcetera. Same with Wisconsin. So Indiana looks a little bit more like Illinois. So it’s interesting that each state still retains it’s character and uniqueness even through all the cross state proliferations. So it’s good, it’s good. It’s a fun industry to be in. It really is.

Mike:   Yeah, it is. There’s a lot of variety. A lot of commonality, but certainly some twists when it comes to localized issues.

Greg:  Yes. There’s still room for personalities in agriculture, right? There’s still room for personalities.

Mike:   There are. Yep. We’ve seen quite a few of them.

Greg:  Yes. Yes we have.

Mike:   So. Well what excites you about the grain industry moving forward?

Greg:  Well, I think the good thing about agriculture is—The fun thing about agriculture and the thing that most gets me excited about it is that no matter what’s thrown at it, it will adjust, and it will come out. There’s not a whole lot of whining that goes on. Obviously we have people that we pay to influence, make our needs known, etcetera in Washington and other places, and that’s fine. But there’s not a lot of whining. I like the idea that moving forward, agriculture will bend and twist with whatever it takes. This goes back to college. I mean when you’re an economics major and you learn Keynesian and you learn Friedman and all the monetary policy, etcetera, and then you go out in the world and it doesn’t work. Agriculture was one of the few places where economics works. You know? I mean the economic principles that you learn, and you love from college actually work. So that’s what I think it is. I think that’s still true today. So that’s the fun part about agriculture. It’s a real industry that rolls with the punches and is very much market oriented.

Mike:   Yep. Yeah. I think the average farmer now feeds, what, nearly 200 people, right?

Greg:  Sure.

Mike:   I think when you got into it it was probably half that or maybe less.

Greg:  That was probably true. That was probably true, yes.

Mike:   So they’ve certainly become more efficient.

Greg:  They certainly have.

Mike:   Our risk managers in and among themselves, lots of risks to manage.

Greg:  Right, right. Right. I mean how many industries—Like for example the grain industry has to basically build in, what, a roughly 3 to 4% growth in the material they handle every year. I mean just think about that. There’s not too many industries that year over year over year. I mean the yields just keep going up. Yeah, there’s a drought here or a bin buster there, but you just look at the long term trend. There’s more material to handle every single year, even if no one changes anything. So that’s a challenge too. So it’s a dynamic industry that still connects back to each one of us, right? I mean we all eat, and we’re all interested. In fact, the food movement has put tremendous focus on agriculture. So it’s almost cool to be in ag now.

Mike:   Yep. All sustainability trend.

Greg:  Absolutely.

Mike:   You are what you eat.

Greg:  That’s right, that’s right.

Mike:   Yeah. Yeah, well that’s cool. So if you roll the clock back three decades, you were programming, you mentioned, on an Apple.

Greg:  Mm-hmm.

Mike:   Like what surprised you most about not just ag but technology?

Greg:  Over the years the technology—I’m not a techno guy. I’m not…It’s a tool for me. I don’t have a real passion for it. I’m looking for more stability and platforms and that kind of thing. It’s a great way to be an entrepreneur. I mean software is a fantastic way to put knowledge down and make it useful to others. I mean it’s the original IP, really, in a way. I mean you can basically…I mean none of this I knew. This was all gathered from my customers. I’m sure in your line of work it’s the same thing. You’re not really creating anything. You may be pivoting off an idea that someone gave you, but at the root of it we’re serving the people that are customers. Our IP really comes from them in a way. That’s rewarding to be able to put your ideas and your organizing of the ideas. That’s probably a key part of it because somebody can come to you with a great idea, but software requires organization. You have to orient it a certain way and you have to make decisions about the way it’s gonna work. Not everybody’s gonna be perfectly happy. So that’s a fun way to make a living. It really is.

Mike:   Yeah. I can relate to everything you just said there. The technology. So how many of these AGRO meetings—It used to be called, what? The Sociation of American…

Greg:  Let’s see. It’s been so long I’m forgetting. WACO. AAWCO. Association of American Warehouse Control Officials.

Mike:   Yes. That’s it.

Greg:  With the proliferation of the grain dealer laws, it was felt that the—Also the whacko was getting old. So yeah. The name change was to basically represent more accurately what the regulators are doing, not just warehouses. So.

Mike:   Yes. So how many of these have you been to?

Greg:  My first one was in 1990. So this will be my 30th conference.

Mike:   Wow.

Greg:  They have had them every year. I’ve forgotten where they’ve all been. We’ve had a few repeats, but yeah. This is my 30th one. So.

Mike:   Wow.

Greg:  Yeah. It’s quite a consistency if nothing else, right?

Mike:   Okay. Congratulations on participating.

Greg:  I’m looking forward to my lifetime membership.

Mike:   I think that’s worthy of a plaque.

Greg:  I would think definitely a plaque.

Mike:   There probably haven’t been too many people who’ve made all 30 like that.

Greg:  Well that’s another interesting thing. I think only Mike Bartles from Nebraska, I believe…I don’t think he…He may have been coming in 1990. He may have come, but I don’t think so. It would have been very shortly after that. So Mike Bartles from Nebraska is probably the only one that would be as long as me. Everybody else is long retired. So it makes you feel old.

Mike:   Well, I can understand that kind of.

Greg:  Yeah. Yeah, yeah, yeah.

Mike:   Well, is there anything else you’d like to mention to our listening audience? Did you have any questions for me?

Greg:  Well…

Mike:   Applaud you [inaudible].

Greg:  Thank you so much. Here all week. Well, no. Other than just I caught your interview with Dan Berg, and that’s what kind of…I really had actually forgotten about all that. I was listening to your podcast, which is really insightful for me. Some good stuff on there. But his stories about the old days really sparked that way back in the cobwebs. But yeah. I mean your Greenstone and the entire AGRIS phenomenon over the years has been exciting. I mean it’s a fantastic evolution of a market dominating…I don’t know if you can say dominating, but you know. I would say from my perspective we see what systems are out there. There is surprising longevity. For example, Vertical Software where I started in 1985 is still operating, which is amazing if you think about it. Your products and there are several others out there that are still operating. So I think that the professionalism and the effort which you guys have put in over the years is definitely paying off. It will happen. I don’t see anything in your way, you know? So congratulations on that.

Mike:   Well, thank you. As you know it’s not easy to succeed in this industry or any industry for that matter.

Greg:  No, right. Right.

Mike:   A lot of people have to do a lot of right things everyday to continue on. So.

Greg:  So true.

Mike:   Yeah. So congratulations to you and your success.

Greg:  Yeah, thank you.

Mike:   I wish you many more years or until you decide to–

Greg:  Yeah, likewise.

Mike:   Put your hat on the hook.

Greg:  Yeah. Well, I enjoy it. That’s the thing. It’s not like a job for me. It’s fun. There’s times it gets tedious, like even fun things get tedious at times. So. But yeah. I really enjoy it. It’s given me freedom to set my own schedule and do. It’s the American dream really in a way. So I’m very fortunate to be able to be sitting in this chair right here. So.

Mike:   Well, thanks for serving U.S. grain agriculture with your products and serving those examiners and many more years of success to you. Again, we’ve been speaking with Greg Miller in Miller and Associates. His products are ExamHand and ExamNet, and I thank you again Greg.

Greg:  Alright. Thank you Mike. It’s a pleasure to be here.

Mike:   Alright. Take care.

Mike Terning:   Today I have the privilege of interviewing Jeff Reardon from White Commercial. Jeff could you please introduce yourself to the audience and kind of give just kind of a background of your journey as to how you’ve gotten to where you’re at? By the way, I’ll mention to the audience we are sitting in Savannah, Georgia today because we’re at a conference called AGRO. Their annual convention which stands for the Association of Grain Regulatory Officials. So a bunch of state examiners and USDA representatives are here and some third party speakers. So, Jeff was one of the guest speakers today. So I’m happy to have him on the podcast. So Jeff?

Jeff Reardon:    Thanks so much for having me Mike. It’s a pleasure. I really appreciate the opportunity to join you.

Mike:   Oh, great. Thank you.

Jeff:   So I was 20 years in banking. I’ll say I’m a reformed banker and came to work at White Commercial in 2008. The markets were running. John Werner, the president of White Commercial, came to me and he said, “Hey, we need somebody to help with our banking relationships.” He saw the need. The need was clear that when markets move with the volatility that we’re seeing, we’re gonna need somebody that specializes in finance and accounting. That’s where I came in. From that minute you could the markets were up. It seemed like every customer I talked to, every employee in White Commercial, everybody I saw in the grain industry was on edge. I was kind of curious if it was always like this, you know? Because you come in in the middle of a fire like that and you wonder if it’s always like that. Clearly, it’s not, but the need is always there. So that’s how I got here. Now I’m the CPA.

So what happened was the need for financing, the need for money, it comes with routines and processes. So we have to be able to report to the banks accurately and timely. So what I found was, well, okay. Not only am I hoping to help our customers increase their skills and increase that communication, I need to do that myself. So I went back to school, became a CPA. Now, same story, right? What we’re trying to do is to help them communicate those financial numbers and to explain those numbers. So that’s how I spent my days and it’s just been a lot of fun.

Mike:   Oh, okay. That’s great. That’s cool. You reside down in Florida?

Jeff:   Oh yeah. I’m down in Florida. Yeah. So I travel. Of course, travel North America. Our customers are all over the U.S. and, of course, Canada. So I have the opportunity to go see agriculture in just about everything.

Mike:   Oh, okay. Have you spent most of your life in Florida?

Jeff:   Yes, yes. So I’m a Floridian. My wife’s a Floridian. We actually met—So I’ve been married 31 years. We met at the University of South Florida. We were swimmers together.

Mike:   Oh.

Jeff:   So that’s been kind of a thing for not only us but our three boys as well.

Mike:   Okay. Well, great. Well, I was married in 1988 as well. So we just celebrated our 31st one.

Jeff:   There you go. Alright. Yes.

Mike:   Yes.

Jeff:   Happy anniversary.

Mike:   Well, to you as well.

Jeff:   I don’t know how my wife did it. I’m still wondering.

Mike:   I can relate to that statement on my side too. Well, Jeff, how long has White Commercial been in business?

Jeff:   We’ve been in business over 40 years. Don White’s the founder of White Commercial. He found White Commercial. Hey, he was in Ft. Lauderdale and he was in the commodities business. He saw an opportunity in the grain business to help the grain business learn basis trading. So the difference between Ft. Lauderdale and Stewart, at the time, was probably 45 minutes. It was quiet. Right? Martin County, Florida at the time, I think, had one high school when he moved there. The whole county. So it was underpopulated if you consider the east coast of Florida. We’re just a little bit north of palm beach, so close to an airport. We still are right there. That’s where our main office is. We’re commodities brokers, as you know.

So our whole mission certainly we’re gonna execute brokers trade for our customers. But our mission, and it was Don White’s mission, is to help with grain merchandising. To make our customers the best grain merchants in the market. So we don’t do it for them. We’re gonna try to teach them how to merchandise themselves because it’s their business, right, so they can control that. Then on my side, obviously, I’m here to help facilitate those accounting and finance relationships. And to make sure that the financials are reporting accurately and that we have the money to cover the margin costs. Hey, you know what? If the customer can’t make the margin cost, then we do. Right? So it’s a risk management tool as well.

Mike:   Yeah. Well, that’s neat. We have a lot of shared clients I believe.

Jeff:   Yes.

Mike:   So our clients use AGRIS or CINCH and they’re using your services for brokerage as well as educational needs, successful merchandising.

Jeff:   That, absolutely.

Mike:   We all want successful customers.

Jeff:   That’s right. The better they do, the better we do. It works that way. So if we can help them, they certainly reciprocate, and they help us. So it’s a great relationship. This is definitely the ag industry. Coming from the banking industry to agriculture, boy it’s a transition. The people are great to work with. Very open, very honest. It’s just been phenomenal.

Mike:   Oh, that’s great. That’s great. We’ve already mentioned what White Commercial does. In terms of the educational arm, what would you say are like 20% of the principles that you teach and explain and help your clients learn that provide 80% of the value to them.

Jeff:   Right. I have to say our whole team—I’m kind of the outlier on our team if you will.

Mike:   Okay.

Jeff:   Our whole team is built around grain merchandising and basis trading skills. So if we teach anything—Of course, Sherry and Don White wrote the book some 25 years ago. The Art of Grain Merchandising is still in circulation, is still being updated. So what we do is help people with grain merchandising. It’s neat to see how important the grain elevator is to the community. Typically in the small communities, it’s one of the big employers. If the grain elevator can help the local producers to lock in profitable prices, guess what? [inaudible] are gonna stay in business. There’s gonna be family farms that are gonna continue to go for generations. So it’s really a neat way to insert yourself into the agricultural business at this level because you see both sides. Of course on the user side, once again they’re probably looking for low prices, right?  Good for us. We can help lock that in at times as well. So without a doubt, that’s where we focus.

Now, like I said, I’m kind of the outlier in that I am 100% focused on helping people with their accounting and finance needs. So when you look at CFO services for our some 300 companies, we’re a niche broker. There’s no doubt about it. You’re not a number at White Commercial. I don’t know if it’s the same with you. When you call White Commercial, you’re gonna talk to somebody you already know, you know? It’s a small group of people that are working very intimately with our customers.

Mike:   Fantastic. What principles have you seen that make for a successful merchandiser or maybe the back office accounting teams or CFOs, etcetera. What have you seen make—What’s the recipe for success in some of those roles?

Jeff:   You hear this all the time, but honesty is number one. There’s so many handshake deals in our business. We’re talking about, in some cases, millions of dollars that are being negotiated over the phone. Maybe you met this person once, but there’s an integrity to the agricultural industry that you don’t see—I don’t want to say you don’t see it in every industry, but it is front and center in the agricultural industry more than I expected it to be honestly. So I would say that’s number one. Really, it’s routines and processes. You have to be willing to learn this skillset and continue to learn it. You ask Don White did he know everything about grain merchandising, he would have told you no. That he’s still learning. On our team right now, John Werner, Phil Luce, Sherry Lorton, they have that attitude. They’re still learning with you as we’re going forward. So I would say lifelong learner.

Routines and processes. Obviously if you’re a basis rater, when you buy grain you have to sell futures, you have to be hedged. The routine of buying the grain, accounting for it, setting spreads, making sales, and making sure that you’re communicating that information with your accounting and finance team. It’s a routine that needs to be replicated daily. So I would say that’s very, very, very important.

Mike:   Well, we like to say usually what makes success in a business is the people. So points to your honesty piece, right? Then there’s a process to follow. Right? So people process and then there’s a toolkit. There’s tools to help the people and help the process. That’s kind of where some of the Greenstone products and services come in as well.

Jeff:   Absolutely.

Mike:   You’re right. That honesty piece is really fundamental everywhere, but you see it a lot in agriculture. You know, one of the things with kind of the way the industry is this year, there’s a lot of concerns among growers and ag businesses doing business with growers. It’s a tough year. There’s some cash flow strains right now. What advice would you give an ag business on how to get to know their counterparties better?

Jeff:   Well number one, you gotta go see them. How often do you get out…Think about the people that you sell most of your grain to. How often do you go visit them? How far away are they? On the sales side, you probably have a limited number of people that you need to get to know there, right? So as far as who the counterparty is there, it’s not that hard but it’s hard to—I’m not saying it’s easy, but it’s not that hard to quantify who they are. Now you’ve gotta block out the time to go do it. It’s great to have the conversation over the phone. I guess I’m right on the cusp of being a Baby Boomer, so I’m gonna say I am. I love the telephone. I absolutely love it. I can have conversations with people and create relationships there. Other people now are gonna use text and email. They’re more comfortable there.

But nothing is more important than going out—just like you’re doing today—and seeing people and meeting people because our industry is very small. You’ll find that you get to know everybody and that helps this web of people. When you visit with somebody, you’re going to find out, “Hey, wait a second. I also did business with you when you were here at this organization or my company did.” There’s gonna be some other connector. So it’s good to go see them.

Mike:   Yeah. That’s sage advice. There is nothing that replicates the face to face communication. What do they say? About 80% of what we communicate is non-verbal.

Jeff:   Right. That’s a good point.

Mike:   So that’s how you get that. Emojis just can’t replace that, I don’t think.

Jeff:   That’s happening right now. They can’t see it, but we’re using our hands.

Mike:   That’s right, that’s right. So what opportunities are you seeing for your clients during these headwinds of trade tariff price declines and poor or less than optimal growing conditions here in 2019. What are some of your clients doing to be successful?

Jeff:   It’s tough what you ask. We know some truth in the agricultural industry. We know that we have crop failures. We know that we have weather events. For those that are going through it, all we can do is do the best we can to help them manage whatever bushels they’re able to control in whatever way it is and manage the relationships. We understand that there’s areas of the country—areas of North America and Canada as well—where production is low. These are long-time customers of yours. So we’re doing everything we can to support the elevator. To support that relationship. We hate to hear about cancelling contracts, but we’re gonna help in that way if it’s necessary. Not if the bushels are going somewhere else, but if it’s being cancelled because of a crop failure. So we’re gonna assist in that area. I don’t want to minimize that.

I will say it’s opportunity for people that do have bushels. It’s a case of the haves and have nots. So if you have the bushels, what you’re gonna see is there’s gonna be a basis premium at some point if we are truly constricted, right. So at that point there is opportunities. You look to…It always comes back to what you buy it for. What you buy the—I’m gonna use corn for an example—what the buy basis for your corn is. Then the next piece, of course, is your spread management piece. So we’re gonna look to that. Then finally you’re gonna see some numbers. We’ve already seen in some cases numbers, incredible numbers to make sales. So if you have the bushels, it could be a good year for you. I know you’re not gonna want to talk about it because your neighbor might not be having that. For us, it’s the same formula of just getting very close to our customers and helping them through whether it’s a negative event—we hope that’s not the case—or whether there’s actually an opportunity for them. Then we’ll guide them in that discussion. Once again, it’s their business. So they’re making all the decisions. We’re just helping in any way possible, whatever needs they have.

Mike:   Sure, sure. Good. Jeff, do you have any questions for me? I don’t normally turn the tables for a podcast but go ahead.

Jeff:   I do. I do.

Mike:   You have a podcast of your own, right?

Jeff:   Yes, yes. So the Elevator’s Cut. We’ll have to share some information.

Mike:   Okay.

Jeff:   Roger Gaddis and Jason Wheeler have been doing the Elevator’s Cut. It’s fun to listen to. It’s definitely got current grain issues and opportunities that they talk about. Like I said, it’s fun. A lot of tongue and cheek. So if you’re looking to have a good time, they’re all in.

Mike:   Okay.

Jeff:   But yeah. I want to know more about—and I started to ask you about this—I want to know more about your products and kind of what you’re aligned with from a software perspective. How are they using it? I’d love to hear from you.

Mike:   Yeah. So we have—Most of our customers use the AGRIS product, which is one of the more mature agribusiness accounting and ERP systems out there in the market today. A lot of them really leverage the commodity management package that’s in AGRIS. It’s very well known. Some of the ABCDs use it as well. So what happens is typically if there’s someone coming out of the ABCDs and they’re managing a cooperative or a grain originator, they’re familiar with AGRIS. They like what it can do and are familiar with it in running those larger businesses. So when they look for growth, they want a platform that they can grow on. Typically that’s how we get new customers is through those and brand awareness from that.

Our systems—both AGRIS and CINCH—really help these agribusinesses manage those processes that you were mentioning and enforce the business rules when it comes to contracting, applying tickets to contracts. They both have premium discount scheduling capabilities. The whole contract to cash routine, that whole process is manageable with either AGRIS or CINCH. There’s a lot of complexities in there when it comes to doing that for the grain industry because growers often don’t want to settle up right away. They might want to defer things based on what tax advice they’re getting from their accountants and things like that. But yeah. That whole contract to cash piece that we help manage. Manage the inventory, the positions. The daily position report for the regulators like who we’ve been meeting with today, but then also the hedge position piece too. Are they long/short? Where are they at?

Then we have add-ons too. Like we have a CRM—customer relationship management package—that can be bolted on to help manage those conversations and track what’s going on with the counterparties. We have an online trading tool we call Rapids. It helps originators and merchandisers contract grain quickly. We also have some mobile things that we’re doing as well for salespeople as well as warehouse staff. It would be more of packaged goods warehouse staff. Then we have some other things we do within culture and technologies like scale automation, bidding, blending, traceability reporting with the system. So yeah.

It’s pretty exciting. It’s fun to be a part of it. Again, we serve some of the same clients. So we are facing a headwind here, but usually there’s an optimism within agriculture. They realize that this isn’t going to go on forever. Low prices have a tendency to fix low prices, right? It’s a cyclical business. We believe it will turn and everybody will come out stronger. There might be fewer that come out. Been a lot of mergers and acquisitions and combinations through the last 20 years or 25 years since I’ve been in the business, and it will continue we believe. They’ll still handle more and more bushels but tends to be less companies and less growers doing it. I guess that’s what we call progress. It doesn’t always feel that way, but that’s what we call progress I guess. So I hope I answered your question.

Jeff:   Yeah, you did. I agree with you by the way that I’ve seen a lot of the consolidations. To that point, the industry’s maturing. At the same time as I’m seeing that, I’m kind of on the other side of that as well. I see large farms that have 600,000/800,000 bushels of space, and they’ve got somebody in the family coming back to the farm. They say, “Wait a second. We could be a grain elevator.” So I’m seeing that same rebirth, if you will, from the large farmers in the community. I’m sure you’re seeing the same thing.

Mike:    You know, we really are. Where a large grain originator or a co-operative might look at an asset or a location and say, “We don’t want to invest in that. It doesn’t fit our criteria.” So they sell it to that grower. Then, like you said, someone comes home from Kansas State or Perdu or wherever and says, “Let’s turn this into a business.” We’ve seen that not only on the grain side, but also on the retail side with agronomy products—fertilizer, seed, crop protection products. So we are seeing that as well where those large growers start serving their neighbors, which is kind of fun to see.

Jeff:   It is. That’s the optimism, right?

Mike:   Yeah. That’s right. That’s right. So what other questions do you have for me Jeff?

Jeff:   I have to say that this conference has been a lot of fun, for both of us. I think we’ve took a lot out of it. I know you took that 3:30 wakeup call. So I had a little more sleep than you did today, but it’s interesting to see how the grain regulators view our business and how there’s certainly ways that we can help them. I’d imagine with the software; a little more understanding of your software would be very good for many of you.

Mike:   Yeah. I just actually before this conversation met with about seven of them, of the regulators, and one other affiliated technology company. We talked about how we can make their jobs a bit easier and that. It’s fun to see because a lot of them do know quite a bit about our AGRIS system, which is fun to see. So I was asking questions about how we could help service our customers better. Really, no one likes an examination, right? I mean our clients don’t like examinations.

Jeff:   No.

Mike:    I don’t like going to the doctor or the dentist. Not too many people do. So how can we make that process easier, faster, painless? So we talked about those topics. I mentioned to them some of the things that are coming out in AGRIS that could make their life a little bit easier. So. Then electronic signatures, things like that, their openness to some of those new technologies. Which they are quite open to, some of them. Some of them need maybe some regulatory changes within their state to be able to adopt some of those things, but yeah. It’s interesting. They’re challenged with constraints and budgets and turnover just like the rest of us. I think we’re all trying to do the right thing here. It’s good to meet with them. So.

Jeff:   So we’ve had some success with some companies in helping our customers create dashboards. So my side what I would do would be just to create an Excel spreadsheet. This is what they’re looking for. This is where it is. Then, of course, you have the software to create that. It would definitely be an add-on to it. I’m wondering if that might be something that they would be interested in because it seemed like their list of needs could be pulled relatively easy from the software. Of course, they have to go deeper and get that. But to get the raw numbers, maybe there’s a place for that.

Mike:   Yeah. We do have what’s called the EDI—electronic data interchange. So they can actually setup some report streams within our system to feed the examination software very quickly. They can get the information into their system to be able to start looking at it. So yeah. It was a good discussion. We’re doing more with dashboards as well, especially for the executives who lead and run the companies that we both serve. So yeah.

Jeff:   Yes.

Mike:   Well, Jeff I want to thank you for your willingness to be a guest today in this episode. Was there anything else you’d like to leave the audience with?

Jeff:   Nah. Just want to say as you said earlier, there’s a great deal of optimism in the grain industry. We certainly understand the challenges that this year brings. On the same side—and we know what that means. There will be pain and it’s very unfortunate. It’s, as you said earlier, cyclical. There is also opportunity and we need to make sure we capture it. So if there’s anyway that we can help—both of us—I know we feel the same way. If there’s anything that we can help to capture that opportunity, we’re available.

Mike:   Oh great. Well thanks again Jeff. Your podcast, again, is the Elevator’s Cut.

Jeff:   The Elevator’s Cut. Yes.

Mike:   Alright.

Jeff:   Jason Wheeler and Roger Gaddis. Thank you so much.

Mike:   Alright. Thank you Jeff. Enjoy the rest of the conference.