Deere & Company: Spare Parts Aftermarket Control & All-Makes Threat
Former Business Manager at John Deere
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Former Business Manager at John Deere
Interview Transcript
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Didn't you tell me that Hy-Gard was something farmers couldn't do without?
Yes, so Hy-Gard, we would target Shell, Chevron, and Mobil's best tractor hydraulic fluid. We would target Hy-Gard to be in the 10% to 15% premium range because it was so exclusive and such a good oil compared to the others. We could easily get a 10% to 15% premium over others in the marketplace with good quality. Now, there's a lot of what was called yellow bucket hydraulic fluids out there, which was just somebody dumping oil in a bucket. We didn't care about those. But for good quality Shell, Chevron, Mobil, and so forth, we aimed for a 10% to 15% premium.
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How big was the Hy-Gard revenue line?
The oil business globally for Deere was about a billion dollars. Hy-Gard was about half of that, so about $500 million globally.
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How profitable was it? I would imagine that's more profitable.
Very, very profitable. The bottom line was probably 40% margin.
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