Sticking to Basics Proves Senter’s Formula for Success

Thu January 09, 2003
Giles Lambertson

Meredith Senter began selling small Ford farm tractors in 1962 from a dealership located on the south edge of Raleigh, NC.

The low-powered, two-wheel-drive Fords in blue and gray were a common sight on small farms as well as on large ones. The era of the huge four-wheel-drive tractors was still a few years away, with many marketplaces just moving beyond domination by International Harvester model-M tractors and two-cylinder “Johnny Pop” John Deere units.

Forty years later, Michael Senter still sells small Ford tractors and some agricultural equipment from a dealership south of Raleigh. But don’t be fooled: Times have changed.

Though Senter Tractor Company still offers a blue line of Ford tractors, the dealership has a far different mix of machines in its inventory in 2002 and a strikingly different customer base. New Holland and Kubota are the backbone of Senter sales today. Landscaping companies, light utility contractors and “sundown farmers” are the dealership’s usual customers.

The original Senter location on South Saunders Street was in the shadow of downtown Raleigh but still was close enough to the “country” that it served area farmers. Sales to farmers accounted for 90 percent of business. But Raleigh, the state capital, was on the verge of tremendous growth in the ’60s and the first Senter store was right in the way.

“The city grew right over the top of us a couple of times,” Michael Senter recalled. Consequently, the dealership kept moving south to keep ahead of the urban tide until on a fourth jump it landed where it is today at 4901 Fayetteville St.

Senter grew up in his father’s business. He worked in the shop and in the parts department, getting grease under his fingernails and the machinery business in his blood. When he graduated from North Carolina State University in Raleigh in 1978, Senter headed south of town again and went back to work with his father. Eventually, he bought out the company.

In the ensuing decades, Senter Tractor has created a space for itself in an evolving market. The mix of business has flip-flopped, with 90 percent of its inventory now going out the gate to customers who don’t make a living on the farm.

Furthermore, though construction equipment and farm machines grow ever larger, Senter has stayed small in its offerings and in its business philosophy. The company is, for example, a New Holland System 100 Dealer, meaning that it predominantly sells New Holland equipment powered by engines of 100 hp (74.5 kW) or less.

In 1970, Senter began selling two-cylinder diesel Kubota tractors, one of the first Kubota “dealers” in the country. In fact, not until 1972 did Kubota actually set up a system of dealerships in this country.

“We were just about buying them straight from Japan,” Senter noted of those pioneering days for the manufacturer.

Today among the dealer’s popular Kubota offerings is the KX121 mini-excavator and the BX2200 diesel tractor. The subcompact BX2200 is powered by a 22-horse 3-cylinder engine. Its attachments range from front end loaders to three-blade mowers to box scrapers mounted on its three-point hitch and rotary tillers operating off its PTO.

“It’s sturdy, reliable and the price is right,” said Senter Salesman “Barney” Barnes, a 10-year company employee.

Kubota’s ZD21F zero-turning-radius mower also is a top seller. The three blades of the 21-hp (15.6 kW) diesel model leave a 60-in. (152 cm) swath of evenly cut grass.

Among the popular New Holland equipment sold by Senter is the LB75.B front-end backhoe loader. The machine’s 4-cylinder diesel engine delivers about 90 hp (67 kW). The 7-ton (6.3 t) machine is one of the larger ones sold by Senter.

The largest of the top-selling machines is the EC130 excavator, which weighs about 15 tons (13.6 t). It is powered by an 80-hp (60 kW) Cummins 4-cylinder diesel and can handle general purpose buckets with a capacity of 1 cu. yd. (.8 cu m).

The New Holland LW110 wheel loader is an exception to the under-100-hp (74.5 kW) general line of equipment. The articulated loader has a six-cylinder Fiat-Iveco engine that cranks out 120 hp (89 kW) and has a bucket capacity of 2.2 cu. yd. (1.7 cu m).

The DC70 crawler dozer is yet another popular New Holland machine. A Cummins diesel produces 70 hp (52 kW) to push a blade about 9 ft. (2.7 m) wide. The dozer is just over 8 ft. (2.4 m) high to the top of its exhaust stack.

The store averages about 150-unit sales a year, most of it “drive-on” equipment. Skid steer machines and their variety of attachments are a strong component. Rentals are part of the company’s business — true rentals. Senter recalled that over the decades the “rental” market has evolved for small equipment as it has for larger: The typical business pattern of renting machines for eventual purchase has changed to one of renting equipment for a particular job with no intention of ever buying.

That’s not the only change evident in four decades of this business, and Neal Council has seen much of it. Council is Senter’s parts manager and has been with the company for 39 of its 40 years. His father, Hal, worked at Senter before him. He has seen the change in machinery offerings, with 4-cylinder Ford tractor 2000 and 4000 models being the staple product back in the early 1960s. Sales of the machines were about 50-50 between yellow industrial models and farm tractors.

But Council said a bigger change has been in how parts are tracked in the warehouse.

“We kept inventory on 3-by-5 index cards,” he explained from his chair behind the counter, looking back on his career. “I would look up the needed parts in my parts book, write it down and go get it off the shelf.”

The process would continue on paper, with paper invoices, adding machine rolls and inventory pads that would be sent off to a company that kept track of inventory for the small business. Now, of course, virtually the whole search and billing process is handled electronically. This has meant that, though company personnel have just increased to 20 employees from a half dozen, business volume has increased considerably more.

“It has helped to make us more efficient,” Senter said of computerization. “We can adjust inventory more quickly to match sales. It is an effective management tool.”

Senter Tractor Company has clients situated across eight counties in the central North Carolina region. But effectively, noted Senter, “Ninety percent of our business is within a 20-mi. radius of our place.” That the 20 mi. (32 km) incorporates some of the busiest commercial activity in the state is one reason Senter keeps busy.

Another reason is schools. “We are very diversified, but what keeps us going in lean times is school construction,” Senter explained. North Carolina voters approved a multi-million-dollar school bond issue that is funding renovation and construction projects on university and community college campuses across the state. Population increases in the region have meant constantly growing public and private schools with resultant campus construction.

All of that has increased demand for Senter equipment.

Personal sales to what Senter calls “sundown farmers” and estate owners also help the bottom line. Approximately three-quarters of compact tractors sold by Senter go to mini-farms owned by part-time farmers and to large residential acreage owners. Mini-excavators like the popular Kubota KX121 rubber-tracked mini-excavator and the 52-hp (39 kW) New Holland LS170 skid steer machines also end up there.

“The equipment has eye appeal,” Senter said of the impulse and non-commercial market. “People want it because they want it.”

The dealership is contained in two buildings on an 18-acre (7.3 ha) site. The main 15,000-sq.-ft. (1,394 sq m) building has 6,000 sq. ft. (557 sq m) of shop with eight bays for working on equipment. Another 4,000 sq. ft. (372 sq m) is reserved for parts. The slightly smaller second building has three more service bays and large storage areas.

Seven technicians work on rental and customer equipment. Allen Batten is the service manager.

Most of the equipment sold and rented by Senter is returned to the dealership for service rather than being worked on in the field or being retrieved by Senter employees. That has proven to be to the customer’s advantage. The advantage derives from the fact that most of the equipment is “trailerable,” being small enough to transport easily.

The 46-year-old business owner said that the future for small equipment business is bright in the Raleigh area, given evidence that population growth will not slow any time soon. “But I think the industry is going to have to work smarter,” he predicted. “We are going to have to offer better customer service and support. Becoming partners with our customers is going to become more and more important.”

He added that he sees changes coming and hopes manufacturers are preparing for it. His job is to have his employees prepared to respond to the evolving equipment offerings and marketplaces, Senter said.

“If you aren’t ready for change, you don’t need to be in the business.” A complete lineup of Senter equipment can be found at the company’s Web site.

For more information, visit www.sentertractor.com.

This story also appears on Construction Equipment Guide.