Case Study

Center Pivot Irrigation Systems

The center pivot is the most widely used irrigation system on Georgia farms. The center pivot is a self-propelled system that rotates around a central pivot point. The drive mechanism for this system may be water pressure, hydraulic oil or electric motors. Most systems in use today have electric drive systems. The time required for a rotation depends on the system size, pump or well capacity and the amount of water to be applied at each application.

The depth of water applied in a given application is determined by the speed at which the system moves around the field. This speed is set by the operator and is determined by the desired amount of water to be applied to the field. Since the flow rate to the system remains constant, the more water applied the longer it will take the system to complete a rotation.

Since center pivots cover a circular area, they are best adapted to fields that are round or square. Because the majority of fields in Georgia are neither, some part of the field may remain unirrigated. On some irregular-shaped fields, farmers will install part circle systems to cover the maximum amount of area. These systems generally cost more on a per-acre basis since they are not capable of completing a full circle.

Linear Move Irrigation Systems

Linear move systems are similar in construction to center pivot systems except that, rather than rotating around a fixed end point, the entire system moves laterally across the field. They are designed primarily for use on rectangular shaped fields. In general, for a linear move system to be feasible, the ratio of length to width should be at least 2:1; that is, the irrigation system is no more than one-half as long as the lateral travel distance. The system is best suited to fields with a minimum amount of slope (0-4 percent).

Most systems are supplied with water from a ditch that extends the length of the field or from a large hose that the system drags along as it travels through the field. Ditch-fed systems will have a pumping unit to pump water from the ditch that is carried by the system. The hose-fed systems are supplied from risers on a pressurized mainline. Either type system can be center fed or supplied from one end. The power for the systems usually is supplied from a diesel powered electric generator carried on the main control tower.

Linear move systems must have a guidance mechanism that guides them in a straight line down the field. Some systems follow an above-ground cable, some follow a buried cable via radio signals, and some are designed to follow a furrow the farmer constructs for that purpose.

Solid Set and Permanent Set Irrigation Systems

Solid set irrigation systems consist of portable above-ground aluminum pipe with sprinklers spaced at specific intervals along the pipe. Permanent set systems consist of buried pipes (usually PVC plastic) with evenly-spaced sprinklers mounted on risers. These systems are typically used on small acreages and/or crops that have a high cash value such as sod. Permanent set systems are also frequently used as under-tree sprinkler systems on pecans and as overhead systems for frost/freeze protection on apples, peaches, blueberries and strawberries.

Usually impact sprinklers are used that can be either single nozzle or double nozzle. Spacing will vary between sprinklers depending on sprinkler size and nozzle size. Typical spacings are in the 40 to 60 feet range, although large volume gun type sprinklers may be spaced as much as 250 feet apart.

Micro-Irrigation Systems

There are many variations of micro-irrigation, but they all fall under two general categories: drip (or trickle) irrigation and micro-sprinkler irrigation. In general, micro-irrigation systems distribute water uniformly to a crop via low volume, low pressure output devices that control the rate of water output. Examples of such devices include drip emitters, drip tape and micro-sprinklers. Advantages of micro-irrigation over other types include:

· water conservation (use to ½ less water compared to other methods)

· energy efficient

· fewer weed problems since systems do not generally wet the entire ground surface

· area between rows remains drier, facilitating spraying, harvesting and other cultural operations

· can be used for fertigation

· reduced labor compared to some other methods

Drip Irrigation Systems

Drip irrigation was first used in Georgia in the mid-1970s primarily on orchard crops such as pecans, peaches and blueberries. It is currently the most popular method used on permanent crops such as these. It is also widely used in ornamental nurseries, and a different form of drip irrigation is also being used on vegetables and strawberries grown on plastic mulch. Drip irrigation systems can be categorized into either "point source" or "line source" type systems.

Most orchard crops and other permanent type crops use what is commonly referred to as point source emitters. These are output devices that are generally attached to a ½-inch to ¾-inch polyethylene supply tubing. Output rates for point source emitters are generally ½, 1 or 2 gallons per hour. The number of emitters per plant will vary from 1 to 16, depending on the type and size of the plant being watered. For example, a mature peach tree might require two 2-gallon per hour emitters whereas a mature pecan tree might require twelve 2-gallon per hour emitters.

These systems are usually designed to operate every day during the growing season when the weather is dry. They should supply the daily water needs of the crop. Systems are generally designed so any one zone will not operate more than 12 hours a day. This prevents creating a permanent saturated soil condition that could damage roots.

Point source emitters and supply lines may be installed on the ground surface or buried a few inches beneath the surface. On widely spaced crops such as pecans, the emitter lines are usually buried to prevent physical damage to the system and to facilitate field operations such as spraying and harvesting.

Micro-Sprinkler Systems

Micro-sprinkler systems are very similar to drip irrigation systems except that, rather than discharging water at discreet points, the water is sprayed out through a small sprinkler device. These micro-sprinklers are typically made of plastic and are available in a multitude of flow rates and spray patterns.

One advantage of the micro-sprinklers compared to drip irrigation is that they disperse the water over a larger surface area (3 ft. to 10 ft. diameter). This is especially advantageous on sandy soils where water applied from a drip emitter tends to move vertically downward, which can cause insufficient root volume being irrigated. For this reason, micro-sprinklers are used extensively in south Florida on citrus crops where sandy soils are prevalent.

Micro-sprinklers may also be advantageous over drip irrigation where water quality is a concern. Because they have larger orifices than drip emitters, micro-sprinklers tend to be less prone to clogging. Since the water is sprayed above ground, a farmer can more easily detect when he has a problem.

Micro-sprinklers have been used to some extent in Georgia on pecans and a few other orchard crops such as peaches. Since they must be installed above ground, they may be more prone to physical damage than some types of drip irrigation systems.

PRODUCTS

Leeky Pipe PVC piping systems are ideally designed for use in agricultural irrigation, including row crop and turf grass applications, and work particularly well in drag, mechanical move and side-shift operations. Agricultural growers around the world have come to recognize and appreciate Leeky Pipe for its easy-to-use (and re-use), leak-proof and corrosion-resistant design. With its dual-gasket coupling system, Leeky Pipe will save you money through the conservation of valuable water resources as well as deliver instant pressurization during start-up. The patented Leeky Pipe "sled" coupling is designed to eliminate leakage during start-up, operation and shutdown, while ensuring the risers remain upright (even during mechanical handling). Leeky Pipe is a highly efficient above-ground portable irrigation piping system that offers numerous advantages over traditional aluminum irrigation products.

· Leeky-Flow corrugated Plastic Tubing is available plain or perforated in diameters from 3 to t0 inches. The 3 inch, 4 inch, 5 inch, and 6 inch diameters came in rolls….the larger diameters in lengths for easy installation.

· Corrugated plastic tubing is available in plain or perforated diameters from 4 to 6 inches in rolls, or self-coupling lengths for certain applications. Various perforation configurations are available.

· Two-inch corrugated plastic tubing offers a solution to drainage areas where minimal surface disturbance is necessary. Little digging is required to install it, yet it efficiently drains any area. The pipe is lightweight and flexible to conform to most any area. Twist-on fittings lock on spiral corrugations for tight, positive connections and comes in easy to handle 500 foot rolls.

· Smooth wall tubing is available for drainage situations where rigid tubing lengths are indicated or preferred. The tubing is made in 10 foot lengths, in 3 inch, 4 inch, and 6 inch diameters with a self-coupling flare at one end. Lengths are pack in bundles of ten or palletized I bulk quantities.

· Leeky Pipe also produced a number of pipe fittings and accessories including couplers, caps, tees, reducers, elbows, fittings, downspout adaptors, splashblocks and sealants.

Why are so many growers switching to Leeky Pipe?

•Growers who used to rely on solid-set aluminum pipe now enjoy higher profits through reduction in pumping costs (up to 20%) due to reduced water-pipe friction. With water leakage minimized, growers worry less about crop damage.

•Growers who previously relied on flooding have realized they can irrigate their crops closer to harvest time, reducing crop stress. They've discovered that tail water management headaches are a thing of the past.

•Switching to Leeky Pipe has impacted time and labor costs. The ability to plant, cultivate and harvest "under the pipe," together with the advantages of drag-on installation and mechanized retrieval (using an AIM machine), are driving up profits.

Leeky Pipe PVC piping products are produced from a special blend of modified polyvinyl chloride (PVC) that includes ultraviolet (UV) inhibitors and impact resistance modifiers, which makes Leeky Pipe ideal for above-ground applications where sunlight and crush resistance is necessary. Leeky Pipe pipe will not corrode or deteriorate like aluminum pipe. As a highly efficient above-ground portable irrigation piping system, Leeky Pipe mainline, laterals and couplings are virtually impervious to sunlight, electrolysis, chemicals and fertilizers.

THE AGRICULTURAL MARKET

Leeky Pipe’s oldest and most important market was agricultural irrigation which accounted for 47 percent of their sales in 2013. The agricultural market is driven by the fact that farmers must be efficient managers and growers. In addition to irrigation, one way for farmers to improve the economic return per acre of farm is to install subsurface drainage, which gives significantly higher and ore reliable crop yields. In wet years, the presence or absence of drainage can have a significant impact on the likelihood of success of the planted crop.

Leeky Pipe has four national competitors in the drainage pipe market. Two competed in almost all the geographic areas in which Leeky Pipe operated. One did not operate in the northeastern region of the U. S. and one did not operate in the Northwest region of the United States. All seemed to favor pricing strategy that recently had led to Leeky pipe becoming the high priced competitor – the others offering pipe at ¼ to ½ cents per foot below Leeky’s price for equivalent products.

Leeky Pipe served every major irrigation region in the U. S. through its sales force. About 60 percent of its piping was sold to contractors who installed it for the agricultural end users. These contractors owned or lease expensive irrigation equipment including plows that could rip a 2-4 foot slit in the soil of arable fields, feed in the pipe, and then allow the slit to close without subsequent digging or filling operations. Other contractors are still using slower and less expensive trenching machines which physically dig a narrow trench in the field. The pipe is the installed and the hole backfilled. A small proportion of contractors started as small business firms. That had grown to larger and profitable multi-machine operations. There still existed many smaller installers who operated a single machine enterprise. Some were farmers who moonlighted in irrigation in order to earn extra income. Contractors were paid by the farmer for installation jobs. Contractors also received a commission from the pipe manufacturer. The result was very intense competition for the loyalty of the contractors.

The remaining pipe was sold directly to farmers who hired a contractor on a job basis to install the pipe. Alternatively, the farmers might install it themselves. Leeky Pipe had an excellent reputation among farmers for service and quality. Management felt that this reputation, coupled with strong sales coverage, gave the company a strong competitive edge in direct to farm sales.

The installation season and, therefore, Leeky Pipe’s selling season was both short and cyclical. Irrigation systems could be installed only in early Spring prior to planting or after crops were harvested in the Fall, but before the ground was frozen in Winter. The market was cyclical as irrigation demand depended, to some extent, on the success farmers had with their crops. In poor crop years, farmers were not inclined to make the capital expenditures that irrigation required.

RESIDENTIAL AND COMMERCIAL MARKET

Leeky pipe’s other selling efforts were directed to the residential and commercial segments of the market. These involved on-site waste management activities (about 35 percent of total sales) and residential sprinkler system products (about 18 percent of total sales). The on-site waste management market was driven largely by housing starts. Nearly 25 percent of all new homes had septic systems installed for waste management purposes. In 2013, management estimated that over 300,000 septic systems were installed.

Leeky Pipe’s remaining markets were residential and commercial sprinkler systems. Construction activity, both residential and commercial, were largely responsible for the demand for Leeky pipe’s products.

THE SALES FORCE

Leeky Pipe’s sales force of 33 people was divided into seven districts. Depending on location, a sales representative was assigned an entire stare, several states, parts of one state, or a single metropolitan area. Large metropolitan areas such as Los Angeles and Dallas were divided into two territories.

The size of territory and number of accounts in it were factors considered in determining territory potential and the need for territory modification. Moore hoped that Davis could develop a market index for determining territory potential.

THE DISTRICT 3 SITUATION

To better understand what was happening in District 3, Moore asked her analyst, Elton Davis to compile information that would help clarify the issues. Davis began by compiling information on call activity for each sales representative by district for the last five years. Table 1 shows these results.

A cursory analysis of Table 1 shows that District 3 experienced a sizeable decrease in the number of sales calls made from 2009 to 2013. Since sales expenses in this district, located in the East, had also increased above average, Davis decided to begin his analysis with this district.

Davis produced a table showing the number of calls made per year by each District 3 sales representative over the last five years. As Table 2 indicates, sales representatives number of calls had decreased since 2009. This was the result of Moore’s insistence that Leeky Pipe’s company-wide sales force call on all retail hardware and farm supply dealers. In order to comply with Moore’s directive, sales representatives were compelled to adjust their routing patters. Mixed results occurred. All sales representatives in District 3 saw a decline in sales calls, and there was little increased sales. Still there was also no appreciable increase in sales expenses. However, all of the sales representatives did experience extra travel time and compensated for this by spending less time on each sales call.

Some sales representatives reduced their number of sales calls in an effort to reduce sale expenses. This is what Davis expected had happened in district 3 where calls had decreased substantially, but sales had remained fairly constant. He decided to examine 2013 sales totals by each sales representative. These are shown in Table 3. Davis calculated sales and calls for each sales representative relative to the total and discovered that Paul Andrews accounted for 20 percent of the district’s sales calls, but only 18 percent of the district’s sales. Davis also observed that Andrews’ average sales per call was $2414.00 In the commercial/residential market, his average sales per call was $1924. In the agricultural market his average was $2701. The national averages were $2067 and $3037 respectively.

ANALYZING PAUL ANDREWS’ PERFORMANCE

With existing data, Davis was able to identify calls and sales made by Andrews in is 27 counties located in Massachusetts, Connecticut, and Rhode Island. Table 4 shows the county breakdowns for Andrews.

Davis examined Table 4 which shows the actual number of sales calls made by Andrews in each county. The fact that Andrews made no sales calls in two counties immediately caught DAVIS’ EYE. When asked about his, Andrews replied, “I go where the business is.” However, a conversation with a former colleague of Andrews revealed that Andrews considered himself an urban-type and did not like water.

The conversation with Andrews’ former colleague made Davis suspect that Andrews was not covering his territory properly. Being unfamiliar with the 27 county territory, Davis sought to learn where the business potential existed for Andrews. He sued two references, Country Business Patterns and the Survey of Buying Power, to generate the data shown in Table 5.

Davis found it interesting that Andrews rarely scheduled overnight stays. Company policy dictated that salespeople with large enough territories could spend up to six nights out per month. Andrews preferred not to exercise this option. When questioned he replied somewhat defensively, “I don’t really like staying overnight in some strange city. If I could, I would come home every day. I like driving, too. What does it matter, as long as I get my work done? I would think that the company would appreciate me keeping my travel expenses to a bare minimum.

TABLE 1

NUMBER OF CALLS MADE BY SALES DISTRICT

LEEKY PIPE INC. 2009-2013

TABLE 2

NUMER OF SALES CALLS MADE BY SALES REPRESENTATIVES IN DISTRICT 3

LEEKY PIPE INC. 2009-2013

TABLE 3

2013 SALES VOLUMES

DISTRICT 3

LEEKY PIPE INC.

TABLE 4

PAUL ANDREWS’ SALES AND CALL HISTORY (22013)

LEEKY PIPE INC.

TABLE 5

SELECTED DATA FOR PAUL ANDREWS’ TERRITORY (2013)

LEEKY PIPE INC.