Seed World

The Never-Ending Quest for the Holy Grail: Low Risk and High Margin

Gro Alliance

A third-generation seedsman, Jim Schweigert grew up in the family seed business and was exposed to industry issues at an early age. He earned a Bachelor of Arts in public relations from the University of Minnesota and worked for corporate public relations firms in Minneapolis, Chicago and Atlanta before joining the family business full time in 2003. He has since been active in the American Seed Trade Association, the Independent Professional Seed Association and earned his master’s in seed technology and business from Iowa State University. As president, Schweigert manages client contracts and crop planning, as well as business development and new market opportunities. His unique background and experience make him one of the seed industry’s leaders in innovation. As such, he was honored as Seed World’s 2009 Future Giant and currently serves as chair of the board of directors for Seed Programs International.

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I wanted to be Indiana Jones when I was a kid. Hunting for lost relics and unlocking history’s secrets looked like the best job in the world!

I especially liked the scene in Indiana Jones and the Last Crusade where he has to determine which cup is the Holy Grail. To save his father’s life, he must drink from the true Holy Grail. A sip from any of the other hundreds of cups and goblets and Indiana Jones dies. For him, this risk was worth the reward.

Searching for the metaphorical Holy Grail is a common practice that doesn’t usually involve risking one’s life. I am struck, however, by the shear amount of risk some companies are willing to take on for what seems to be small margin opportunities. This imbalance of taking high risks for small rewards is a growing theme. Margin is hard to find, and some are risking a lot in the quest to discover it.

Risk taking doesn’t always mean doing something either. In fact, some of the riskiest behavior I’ve seen involve companies operating just like they did last year. No lineup or territory changes, no operating structure reviews, no new partnerships or ventures. They stay with the status quo.

The comments I hear back when I’ve asked about why they haven’t made a move despite the risks sound similar. It’s typically something along the lines of “If X or Y changes in our favor, everything will be good.” The X or Y is usually labor costs, product/input costs, crop acreage or sales volume. 

In short, I see a higher number of companies picking up cups to drink from without having a reward that offsets the business risk they are taking on. You do not want to ‘choose poorly’, as the movie quote goes.

Gro Alliance isn’t immune to the changing industry. In some ways, we are even more impacted as our clients are seed companies. And we all know there are a finite number of those. The more we can help companies regain margin opportunity and build a more resilient business, the better off our long-term prospects are. That may be why we are moving more quickly to make positive changes in our business to prepare for the road ahead.

The best news is that we can help you pick the right cup. A partnership with Gro Alliance will help you uncover hidden margin in logistics, seed services, genetics and business planning. Our list of services, crops and locations continues to grow as we find creative solutions for seed companies and breeders. Reach out to us and let’s find the Holy Grail together!