27 Oct Owner Feature: Ernie Roncoroni
California retailer evolves to stay ahead of high costs, customer needs
He’s quick to joke that it takes a lot of “whiskey and cigars” to get through some of the challenges he and his customers face right now in the Sacramento Valley of California — an area where agriculture is facing a combination of natural and man-made hurdles. But in the same breath, Grow West President and CEO Ernie Roncoroni immediately pivots to what it really takes.
“Pivot and move,” said Roncoroni, who leads the Woodland, California-based ag retailer who’s also an Aligned Ag Distributors (AAD) owner. “We’re approaching things totally differently than we used to, and our customers are too. Now, we need to have a Plan A, Plan B, Plan C and Plan D and be ready to move to the second, third or fourth option if your first one isn’t feasible.”
That adaptability extends well beyond just buying and applying crop nutrition or protection products on every acre of the dozens of crops Grow West’s team of PCAs, CCAs and other experts service. For the Sacramento Valley native, leading Grow West with an emphasis on flexibility and adaptability is part of every decision he makes, from servicing growers to managing his own workforce.
President and CEO
“We’ve got a lot facing us right now. It’s multi-faceted, and I can’t say one thing is a greater challenge every day than everything else,” Roncoroni said. “You just can’t get stuck in the mud. That’s what I keep telling our people. We have to just adapt to the situation every day, continue to communicate the best we can and be honest and transparent with everything.”
Evolving to meet growers’ needs
The last few years have ratcheted up the pressure on growers and ag retailers in the Grow West territory. A combination of drought, regulation and crop protection and fertilizer logistical hurdles has changed a lot of the normal dynamics between growers, retailers and others in the California ag supply chain. That’s why Roncoroni has been quick to evolve and adapt to make sure he’s doing everything he can to ensure his growers have what they need, when they need it.
“We’ve never been a just-in-time company. We’ve always tried to frontload the market as much as possible,” he said. “We’re currently carrying more product and adding more chemical storage. We’re carrying twice as much inventory now than we were just a year ago. We try to avoid being on the wrong side of a big purchase.”
With so much pressure on things like crop protection supply chains, Roncoroni said the way he works with customers has changed in ways beyond simple product supply and demand. Though there are still growers to whom the retailer connection remains “super transactional,” he’s seen a shift to more relationship-driven business. It’s largely due to resource constraints and growers becoming more proactive with ensuring they have the crop nutrition and protection products they need. Effective communication is fundamental to growers getting what they need as this shift unfolds.
“When some growers want something, the retailer better have it or they’ll call the next person. But it’s a different time, and gone are the days that they have five people calling them to get them everything,” Roncoroni said. “A lot of growers today are taking advantage of things like early pricing, communicating often with their retailers and just generally thinking ahead because they know the supply side is not comfortable anymore. The more communication we have with our growers, the better prepared we will be to meet their needs.”
Planning for higher costs
That type of planning will remain critical to farm and ag business viability and resilience moving forward. Given the likely shortages of some staple food products based on the drought that’s trimmed output for many crops in Grow West’s territory, Roncoroni expects prices to trend higher as tight supplies work their way through global food supply chains.
It will up the pressure on everyone from the farm gate to the consumer. That could mean price increases for everything from consumer products all the way back to inputs like fertilizer and crop protection products. It adds to the urgency of planning ahead for both growers and their retail partners.
“I truly believe we’re seeing a complete reset of prices right now for everything from what the consumer buys to input costs and what we pay for things at the retail level,” Roncoroni said. “I think we’re seeing a complete step up in the cost basis across the board. We’re paying more, selling for more and our growers are going to market for more. The consumer is going to be paying for it.”
Global geopolitics is compounding the cost and supply issues for a lot of crop protection and nutrition products. War in Ukraine, lingering trade issues with China and the simmering potential for conflict between China and Taiwan could continue to influence product availability on the global marketplace, and the crystal ball is cloudy. Roncoroni sees his ownership of Aligned Ag Distributors as a key piece of overcoming these types of challenges.
“Aligned Ag gives us a national presence, so we have priority with suppliers. It makes sure we’re in the discussion,” Roncoroni said. “We joined Aligned Ag to be more significant in our marketplace and get the respect we need from suppliers. It’s fortified our relationships with suppliers, locally and globally. That enables us to best take care of our customers and our communities.”