Co-op holds first virtual annual meeting; reports ‘super year’
Dec 21, 2020
The virtual meeting was broadcast from the TFC Board Room at the LaVergne headquarters. Representatives, including one voting delegate and only one other representative from each member Co-op, gathered at six locations across the state: the TFC Tenco Conference Room in Rockford, the TFC Jackson Warehouse, Clyde Austin 4-H Center in Greeneville, Maury Farmers Co-op in Columbia, TFC LaVergne Conference Room A, and Hyder-Burks Agricultural Pavilion in Cookeville.
Before COVID-19 turned the world upside down, the 2020 Annual Meeting was intended to be a momentous celebration of TFC’s 75th anniversary, complete with special guests and surprise entertainment. The reality turned out much more subdued.
“At last year’s meeting, I promised a hootenanny to celebrate our 75th anniversary,” said TFC Chairman of the Board Mark Thompson of Cumberland Gap. “I don’t think anyone of us could have pictured the kind of year we have had.”
The COVID-19 crisis impacted the daily lives of the entire world and brought recognition to the importance of agriculture as an essential business, while much of the country was locked down to mitigate the spread of the virus. As essential businesses, Co-ops stayed open during the lockdown to ensure farmers were able to keep supplying the food, fiber, and fuel. During the year, the safer-at-home orders became less restrictive, but a fall surge of the virus ensured large gatherings were not possible. The decision to hold the meeting as a virtual event was intended to protect the health and well-being of all Co-op directors, managers, employees, and guests.
“It just makes sense for us to be careful,” stressed TFC Chief Executive Officer Bart Krisle, who noted the Co-op community had been looking forward to a special 2020 meeting.
“It was the right decision for all us and our families,” Krisle said of the virtual meeting. “In spite of the circumstances, the system faced all those challenges by pulling together, and TFC had a ‘super’ year.”
Sales for the 2019-20 year were an impressive $628.9 million with gross sales of $34 million. These results allowed the return of $26 million in cash to the member Co-ops.
Following the strategic direction laid out by the TFC board in 2018, TFC finished the year with two of three proposed joint ventures complete and made significant progress on the third.
Faithway Alliance — a joint venture between TFC, Alabama Farmers Cooperative (AFC), Alliance Farm and Ranch, and Faithway Feeds — began operation on Aug. 1, 2020. The company focuses on sales, marketing, customer service, procurement, inventory management, warehousing, and distribution for farm supplies at TFC, AFC, and Faithway Feeds. Faithway Alliance provides member Co-ops with products from categories including lawn and garden, farm hardware and fencing, automotive, horticulture, and home goods.
“While there were initial issues with ordering, training, and communication, much progress has been made to correct those things,” said Krisle. “We’re pleased to report Faithway Alliance sales are ahead of budget through Nov. 30.”
GreenPoint AG was established Sept. 1, 2020, and includes TFC’s wholesale agronomy operation; Agri-AFC — a joint venture between Alabama Farmers Cooperative and WinField United, formed in 2003; and GreenPoint AG — a joint venture between TFC and WinField United, formed in 2012. GreenPoint AG’s entire retail agronomy company is included in the new undertaking, which will also be referred to as “GreenPoint AG.”
The new company encompasses $1 billion in wholesale and retail sales, making it the seventh largest agronomy distribution company in the nation. It operates 82 retail and 22 wholesale agronomy locations in 10 states: Alabama, Arkansas, Florida, Georgia, Kentucky, Louisiana, Mississippi, Missouri, Texas, and Tennessee, servicing 11 crops across 28 million acres. TFC owns 38 percent of the business.
The feed joint venture is proceeding, too, and officials expect to make an announcement about it soon.
“When launching new ventures like these and changing how we’ve done business for 75 years, you expect some challenges,” said Krisle. “But you don’t stop.”
Thompson agreed, comparing the change to when Co-ops stopped hand-writing tickets in favor of a computer-based system.
“That first year, there were a lot of choice words as the employees and the customers got used to the computer,” said Thompson. “Then, the next year, the computer system went down during the spring rush. But we stuck with it, and now we couldn’t imagine doing business without computers or our Merchant Ag system. It’s given us a great depth of useful information, and we can go back and see exactly how we’ve spent our money during the year.”
There is a long history of our Co-ops working together, he stressed. Interregional organizations like Universal Cooperatives, FFR Cooperative, CF Industries, and Allied Seed were created to meet a need, and now many of these organizations no longer exist because those needs have changed.
“Some have asked if these joint ventures mean TFC will cease to exist,” said Krisle. “Certainly not. There are a lot of programs and services that TFC provides for the member Co-ops that we can do economically and efficiently for the system to reduce costs.”
Examples include innovative approaches like:
• CFS, which allows the system to manage credit more efficiently for the member Co-ops and whose income in recent years has contributed significantly to the cooperative’s bottom line and provided healthy patronage to member Co-ops;
• AGRI (Agricultural Risk Insurance Company), the Co-op system’s captive insurance company that provides workers compensation, general liability, auto liability, and property insurance for member
Co-ops, allowing the system to share risk and save on premiums;
• Co-op Pension Trust which saves the system fees and costs while providing for the financial security of Co-op employees, and;
• EFC Merchant Ag Software, the highly customized point-of-sale system that provides management with vital tools to analyze the business and make informed decisions to determine areas of focus.
Krisle said TFC’s Leadership Team has worked diligently through 2020 to develop a new mission, vision, and values for the cooperative. The mission is to “provide innovative and quality solutions supporting the sustained success of our customers,” while the vision is “To be the leader of the most innovative and financially successful agricultural cooperative system in the U.S.”
“These documents will guide us as we develop our strategic direction,” said Krisle. “Our intent is to improve the investment the members have in TFC. We are also exploring ways we can work together to benefit the system financially as we provide tools to increase revenue and lower expenses. We’re not sitting still. We’re moving forward and positioning ourselves to be successful in the future.”
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