Meeting the Demands of Ever Larger Customers
Innovative Ag Services has followed a tried-and-true path for the U.S. grain and farm supply industry in recent years. Based in eastern Iowa, the farmer-owned cooperative has gained scale through consolidation with other area cooperatives and businesses, enabling it to enhance operating efficiency and offer better service to its farmer-members.
IAS operates more than 30 grain and farm supply facilities in Iowa and western Wisconsin, as well as an ethanol plant. The cooperative serves approximately 5,300 farmer-members who grow corn and soybeans as well as raising swine, beef, dairy and poultry. It operates in the grain, agronomy, feed, energy and building supply markets. Formed in 2005, IAS has grown primarily through acquisitions and mergers until its most recent consolidation in 2011. Since then, IAS has focused on growing its market share while keeping a keen eye out for strategic partnerships.
“Our strategic consolidations were critical to keeping up with what’s going on in the industry,” says Rick Vaughan, CEO of IAS. “Now, bringing more production volume from our customers to the table each year is just as valuable to our ongoing expansion and to helping us remain relevant to our members.”
Such growth is necessary to meet the demands of ever larger customers; it’s also critical in working with the vendors who are a key component of IAS’s business. “We need to stay on our vendors’ radar screens so that as they’re designing new programs, we’re in a position to offer input that will ultimately benefit our members,” says Vaughan.
CoBank has supported IAS and its predecessor organizations with credit facilities for almost 40 years. CoBank provides seasonal financing for operating capacity and term funding for material capital expenditures, along with leasing through Farm Credit Leasing. IAS also uses cash management services to manage everyday customer and vendor transactions.
CoBank is a one-stop shop where we can get our regular financing needs met, additional financial services and access to their industry expertise.
IAS’s diversification is also a strategic solution to meeting both customer needs and growth plans. Many customers use more than one IAS business line, requiring strong coordination and communication among the IAS team to maintain the overall relationship, which IAS views as an opportunity.
“We strive to build strong customer relationships across business lines and through each interaction we have, so our members will want to continue to do business with us,” says Hoefler.
“IAS has a very solid leadership team that understands the industry and their territory, and it has the size and scale to remain a big player in their marketplace,” says Mike Hechtner, CoBank central regional president. “They’re poised to continue their decades of growth, and we look forward to continuing to support them.”