Mn equipment

100 Years, Five Generations of Dedication In the late 1890s, J.M Scharber opened a general store that first established the family name in the Minnesota business world.

By Giles Lambertson CEG CORRESPONDENT

The Scharber family in Minnesota has been a John Deere dealer longer than Deere & Company has been making tractors. Think about that. One hundred years, that’s how long this dealership has been in business, a number as round as the zero-turn radius of a John Deere ZTrak mower.

We’re talking ancient history. 100 BT. Before Tractors.

Now part of a multi-dealership J.M. Scharber’s general merchandise and grocery store as it appeared in Rogers, group called Minnesota Equipment, Minn., in 1903.

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Otto’s Red & White Store.

the family company still is thriving in 2016 and has positioned itself to plow ahead for another century. Asked to look a mere 25 years down the road, Mike Scharber, company President, said he sees the Rogers, Minnesota dealership still serving customers in 2041.

“I would like to think so,” he said.

“We have stores covering three quarters of the Twin Cities metro area, with room to grow. We have a lot of potential yet.”

1932 Chevrolet “Mobile Grocery Store” allowed Otto to travel the countryJohn M. Scharber was the founding The side selling groceries door to door. father of the family dealership when in 1916 he began to sell Deere plows and other implements from his general merchandise later, a steel-wheeled unit with a two-cylinder, and grocery business —Scharber’s General Store. The kerosene-fueled 12-hp engine and painted, of course, first Deere tractor was introduced a couple of years John Deere green.

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An aerial photo of downtown Rogers, Minn., circa 1938.

Otto Scharber in the late 1930s feeding his flock of ducks.

Otto Scharber farming after hours.

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(L-R): Otto Scharber, Alec Weber and Lenny Schlegel loading another tractor for delivery.

After 13 years, Scharber’s son, Otto, bought the business and renamed it Otto’s Red & White Store. In a nod to its potential as a family legacy business, the store eventually was renamed Otto J. Scharber & Sons.

The community of Rogers at the time was in the midst of farming country, a farm town 20 miles northwest of metropolitan Minneapolis.

The agricultural tractors and implements produced by John Deere helped Rogers and the rest of rural Minnesota begin the transition from traditional labor-intensive farming methods to mechanized agricultural systems.

And the Scharber store grew right along with family involvement in it. Otto’s son Doug joined the enterprise in 1938. He oversaw the dealership’s product line expansion from the popular Model A and B tractors through the end of the “Johnny-Pop” era of two-cylinder engines and the introduction of conventional New Generation four- and six-cylinder engines.

Lawn tractors were introduced to the lineup in 1963 and soon became a sales volume leader.

The character of rural Rogers was evolving from agricultural to suburban. Doug Scharber, with the help of his three boys; Steve, Mark and Pat anticipated the demographic change and

Lenny Schlegel in that late 1930s fixing a lawn mower.

Lenny Schlegel is ready to help customers find exactly what they need as he mans the Scharber & Sons’ parts counter.

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equipment today is “a much smaller piece of the business.

We have more part-time than full-time farmers now.” Hay balers and 240-hp 4WD tractors still are listed on the dealer website, but full-sized ag equipment is not a growth segment for the dealership.

Deere construction equipment is a busier business segment, particularly compact machinery like skid steers and track loaders along with small excavators and compact wheel loaders. Metro-area construction activity pushes demand for this machinery as well as the needs of commercial customers and local governments, which employ the equipment in maintenance operations.

In pure numbers of units sold, the residential division of Minnesota Equipment — that is, lawn-and-garden machines — constitutes 60 to 70 percent of business volume, according to Scharber. But in sales dollars, commercial and government buyers of bigger equipment are the biggest slice of business activity.

It was eight years ago that, at Deere corporate’s urging,

(L-R): Doug, Steve, Mark and Pat Scharber see the showroom expand with the addition of lawn and garden equipment as they stand outside of the Scharber & Sons building in July of 1974.

diversified accordingly. By the early 1980s, for example, Scharber & Sons annually was selling 150 garden tractors and 25 ag tractors ranging up in size to the 150-hp 4450. In 1982, the booming dealership moved into a new sales-andservice facility on the edge of Interstate 94.

Today, Minnesota Equipment still operates in Rogers from the I-94 property, but the mix of equipment sold and serviced there has changed. Mike Scharber said that ag 10

Main Street storefront of the Scharber & Sons dealership.

It’s a meeting across the family generations as (L-R) Otto, Doug, Steve and Mike Scharber, holding a mini John Deere tractor gather for a picture.

Doug Scharber takes calls in his office.

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(L-R) are Zac, Andy, Bart, Jerry, Glenda, Marvin, Rob and Mark, all of the service department, Isanti, Minn.

(L-R) are Henry, Dan, Simi and Jack, all of the parts department, Isanti, Minn.

(L-R) are Jesse, Bob, Mark and Jim, all of the sales department, Isanti, Minn.

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four John Deere dealerships in the area came together under the umbrella of MN Equipment Solutions. The Scharber dealership was the largest of the merged locations but the other dealers were firmly established, too.

The four units included Scharber’s Rogers location and a branch in Long Lake, as well as Isanti County Equipment in Isanti, Suburban Lawn Center in Ham Lake. Then in 2009 the combined group purchased Weekend Freedom located in Savage to make it five locations At first, the five members of the consortium operated pretty much on the strength of their heritage brand names. The union of dealerships was more about back office efficiencies than public functions. In February of 2015, however, the merger became more of a reality and phones at each location began to be answered with a new and shorter name: “Minnesota Equipment.”

“We now are a cohesive unit,” said Mike Scharber, with individual dealers leveraging the association so customers can benefit from the larger business unit’s logistical savings and

(L-R) are Jim, Kurt and Dan, all of the parts department, Ham Lake, Minn.

(L-R) are Bruce, Patty and Mike, all of the sales and administration department, Ham Lake, Minn.

(L-R) are Bill, Alex, Dan, Joel, Pat, Mike, Ernie and Lenny , all of the service department, Ham Lake, Minn.

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Savage, Minn., employees (L-R) are Jayson, sales; Jonathan, store manager; Darryl, service administrator; Bruce, sales; Paul, service; Steve, service; and Ed, service administrator. On the loader bucket (L-R) are Ken, parts; Rodney, service; and Jerry, service.

Jonathan is the store manager of tbe Savage, Minn., location.

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Doug (L) and Mike both of the sales department, Long Lake, Minn.

Jack (L) and Randy both of the parts department, Long Lake, Minn.

(L-R) are Tim, Terry, Chad, Mike and Jason, all of the service department, Long Lake, Minn.

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(L-R) are Eric, Mike, Dan, Mark, Doug and Mitch, all of the sales department, Rogers, Minn.

Kevin (L) and John, both of the sales department, Rogers, Minn.

(L-R) are Deann, Myra, Scott, Trent and Wendy, all of the administration and marketing departments, Rogers, Minn.

(Sue not pictured ) 18

(L-R) are Jake, Josh, Troy, Reid, Jason, Chris, Todd, Mike, Pat, Tyler, Mark, Dana and Danny, all of the service department, Rogers, Minn. Not pictured are Randy, Gary and Glenn.

(L-R) are Larry, Drew, Phil, Joe, Bruce, Russ and Mike, all of the parts department, Rogers, Minn.

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Rogers dealership include a flexible inventory. For examfull line of Stihl handheld ple, in 2015, numerous “Change is never easy, but when products and trailers. model changes were introThe recession and postduced by Deere. Because of you look back on the changes that recession years that coincidthe merger, the associated dealers were able to move the have happened over the years, they ed with the merger may have been a factor in the new and older model invenhave all worked out for the best. dealerships consummating tory among the five locations the deal relatively slowly. to best match customers and Mike Wrobel The dealers had other things equipment. to think about. Scharber said The core of the Minnesota Equipment product line is Deere machinery, large and small. his dealership responded to the recession by tightening its Whether it is traditional green and yellow Ag and residential operating procedures, such as reducing upfront expenditures equipment or the entirely yellow iron of Deere construction, and leaving open positions unfilled. “The recession prothe Moline, Illinois manufactured machinery forms the duced some challenges at first. But over time, the downturn backbone of the dealership. But other complementary and created smart growth in our dealership as we managed quality brands are found in the showrooms and equipment inventory and expenses.”

Being smart in the 21st century, said Scharber, means facyards.

“John Deere has the largest breadth of products and we ing the challenge of new technology and a glut of consumer have focused on it, along with Toro and Ariens-Gravely,” information. “We’re just another industry experiencing rapid said Scharber. That trio of companies cuts a wide swath change in technology in our products. Consumers are more through the equipment industry from tractors to lawn-mow- informed, so we really must have trained staff to talk intelliers to snowblowers. Auxiliary products in the lineup of the gently about the equipment. Our employees need to be 20

“Merging our companies back in 2008 was a difficult decision, but it was clearly the right decision to make at the time.

Mike Bell

trained in depth on a very wide array of products in order to give the proper direction to the consumer that has already extensively researched the products online.”

The company president said the swift changes in product technology mean that dealerships need to cultivate and maintain strong relationships with manufacturers to keep abreast of fast-breaking developments in machinery. “You have to be ready for change,” he said. “You have to be a good partner with your manufacturers and participate in all the training.”

Scharber sees new waves of technical change continuing to roll out, including fleet-management tools like telematics and mobile apps. “There is a lot of new technology coming out of the large agriculture equipment sector and it’s just a matter of time before some of the technology moves down into smaller equipment.”

Other challenges are old hat by comparison, such as balancing the busy spring and fall seasons of the upper Midwest with the summer doldrums and winter blahs of the business. The latter seasonal slowdown has been mitigated somewhat by the renting of small tractors and compact loaders for snow-plowing and removal.

Yet another constant business challenge — having a product on hand when a customer asks for it — has been met more easily as a result of the merger: The five dealerships are becoming proficient at swapping equipment to meet local demand. Scharber said his dealership also is working closely with vendors to have more inventory delivered during winter months so that it is ready to rent or sell in the spring.

“We are in a world in which a customer makes a buying decision and they want the equipment immediately to put it to work, he said. “We are working a lot on establishing short lead times in equipment delivery.”

The payoff for the dealership having paid attention to change and handled its economic challenges in a “smart” way is a 45 percent growth in business volume since 2008.

Mike Scharber was asked if such business expansion leads inevitably to expanding the company presence across Minnesota to other regions.

“I don’t know that we would ever do that,” he said. “It would take us away from our focus. It would mean wholesale business change because we would have to move into larger ag equipment. Our neighboring dealer groups are already doing that and we would be the small duck in the pond.”

The company has sufficient challenges to meet where it is.

“We have to continue to differentiate ourselves in the marketplace,” the company president said. “We have a 100-year heritage as a company, a century of experience and knowledge and of service to customers. That is our brand and we have to draw on that.”

The 44-year-old Mike Scharber and another grandson of Doug’s, Dan Scharber — who is the company’s secretary-treasurer — are co-owners of Minnesota Equipment and represent the fifth generation. The next generation is 21

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represented by Mike’s 3 children and Dan’s 5 who, Scharber in a mixed metaphor, says “a few of them are just getting their feet wet mowing the lawn and cleaning tractors.”

So a sixth generation of Scharber leadership of the John Deere dealerships isn’t happening this year or next. In the interim, it is steady as she goes for current leadership.

“There always is going to be a need for the equipment,” Mike Scharber said. “It may not be the same as today.

Autonomous mowing may be coming. We may not be riding mowers one of these days. But there always will be demand for equipment that makes customers more productive, adds value to their situation and gives them a better operating experience.”

The key, he says, is for the company to be there for those customers. “The Twin Cities and the Midwest is a brandloyal area. If you can build relationships and take care of your customers, your business will grow. Minnesota Equipment is focused on offering the best equipment to our customers and to have them benefit from our heritage of 100 years of successful customer relationships.”

(This story also can be found on Construction Equipment Guide’s website at www.constructionequipmentguide.com.) CEG

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