Deere & Company: Evolution Of Parts Availability

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You mentioned the availability was in the high 80s. How did it change, and what was the time frame? What was required for that improvement? What actions did you take with the dealer network to enhance the availability so significantly?

The second line of defense is if the dealer doesn't have the part, Deere should have it. Literally, 99% of the time, Deere will have the part. There might be some parts that are stocked out or in short supply, but it will be at a Deere warehouse. With Deere's logistics capabilities, that part can be sent overnight, within 24 to 48 hours, to your local dealer store. So, 80% of the time, the dealer has it; the 20% of the time the dealer doesn't, 99% of the time Deere has it, and in the high 90s, Deere can send it overnight.

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How does this compare to competitors?

It depends on the competitor. We're mostly talking about agriculture, but I'll quickly comment on construction. In the construction business, Deere is number two to Caterpillar and somewhat distant. Caterpillar boasts 99% to 99.5% parts availability in construction, while Deere might boast 96% to 97%. You might think that's close, but those one or two points represent massive differences in cost and customer service. Deere is number two in availability on the construction side. However, on the agriculture side, given Deere's market share and preeminence, it is number one in parts availability. I don't have the latest statistics on all companies, but if Deere's network can reach 97% to 98% of dealers in one or two days, and 99% of the time Deere has the part somewhere in its network, other companies are 5 to 10 points behind Deere. The main companies that matter are Deere, Case New Holland, AGCO, and Kubota, and they all perform less. They have 90% availability, but the difference between 90% and 97% is significant.

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