Farm and Ranch: Still riding high

It’s still optimism, but it’s the kind of optimism that appears to be heading back to earth.

That’s one way to describe the mental state of farm and ranch retailers as measured by the latest Robert W. Baird & Co. “Farm and Ranch Supply Retailer Survey.” The data covered the July through September selling season and collected answers from a pool of retailers representing 250 locations in 25 states and more than $1 billion in annual sales. Overall, the results show third-quarter sales were generally up, and slightly better than expected, with more of the same expected for the fourth quarter.

Data shows the median sales growth for the farm-and-ranch retailer in the third quarter of 2013 was in the 1% to 3% range, after a growth spurt of 4% to 6% in the second quarter.

From an expectations standpoint, the survey marked a slight retreat from the strong figures reported in the previous quarter. And fewer respondents reported sales “well above expectations,” while slightly more respondents reported third-quarter sales below plan.

Costs rising

According to the survey, there was not a lot of movement in product cost inflation trends. Across the board, about 30% of respondents saw rising costs in key categories. In feed, however, only 25% saw inflation, compared with 33% in the previous-quarter survey.

Category sales

Among core categories, clothing and footwear sales set the pace for the farm-and-ranch space in the third quarter. Some 20% of retailers reported sales were up more than 10% compared with last year. In seasonal departments, 43% of retailers surveyed said hunting and outdoor sports showed an increase over last year. Fall lawn and garden had a 40% incidence rate of growth.

Sales outlook

About two-thirds of farm-and-ranch retailers surveyed expect the fourth quarter to bring sales increases anywhere from 1% to more than 10%. The median outlook calls for 1% to 3% sales growth in the fourth quarter.

Baird invites farm and ranch retailers to participate in its fourth quarter industry survey. Responses are anonymous. Click here to take the survey.