The rapid growth of the sharing economy is now opening up a new way of doing business for agriculture as a tractor rental app makes its debut in South Africa’s farming sector.
Technology in agriculture is evolving so fast, farmers who tie themselves down with pricey tractors or spray carts risk being left behind as new efficiencies emerge. Likewise, those who have ambition to stay ahead with the latest and greatest equipment can find themselves deep in debt.
And while tractor rentals are not a new concept in the country, a formalised online app able to connect equipment owners with potential rental customers is now providing a trusted platform where the interests of both parties are protected.
Launched by AFGRI Agri Services, the Axl app is the first of its kind in South Africa and bodes well for the established and emerging farmer sector.
Head of AFGRI technology services Niki Neumann says the concept was launched with a view to making sure farmers could have access to the right machinery at the right time, which is fundamental to on-farm success.
“Whether it is a small, emerging, or large commercial farmer, this is an ongoing challenge for them all, especially now. With the COVID-19 global pandemic having left global supply chains under immense pressure, uncertainty remains in the minds of our customers and currency volatility has resulted in the increase in equipment costs.
“Axl provides an opportunity for those with machinery standing idle to make it available to other farmers, but at a cost,” she added. “This is particularly good for upcoming and small scale farmers who can’t always afford the equipment, or someone whose machine may have broken down. Sometimes a farmer just needs an extra tractor or spraying cart, and buying another one just doesn’t make sense.”
She said when AFGRI started developing the concept, they were prompted to build a community of quality-rated equipment service providers to be there for farmers when they need them most. “Uncertainty and change are a daily reality for farmers, inherent in our lives now and going forward. Access to the right machinery at the right time is a critical success factor for all of our farmers.”
Neumann said the alternative access to mechanisation presented by the app made it easier for emerging farmers to gain a foothold in the sector. “Capital equipment costs can put a lot of financial strain on new or smaller operations. Our vision is to make necessary equipment available for rentals so farmers who do not want to or who cannot purchase capital equipment have the appropriate access.”
Managing director of AFGRI Equipment Patrick Roux said the app was more than just an online service. “It breaks down those traditional mechanisation cost barriers by creating a secure and shared environment, which encourages all of us to do more with less. In times like these, this has never been more important.”
Furthermore, the app will allow equipment owners to fully utilise their equipment throughout the year, getting a better return on their investment. This means equipment owners are also in a better position to keep up with the new technologies coming on to the market.
Equipment rentals are also especially useful to farmers who need their equipment only for a certain time of the year, and are in an area where alternate season crops require machinery.
This online platform enables the convenient rental of farm equipment, facilitates the contract between renter and owner, and provides a secure payment platform, all without either having to set foot outside their own door. This allows service providers – equipment owners, retailers, and contractors – to build their business and grow revenue streams through the optimisation of the rental system.
The payment process is handled by Axl and users can do an electronic bank transfer. While the renter needs to make an immediate payment to secure rental, the money is released to the owner only once both parties are happy with the service. The user and owner are able to rate each other, and similar to the online Uber taxi service, customers can build an online reputation.
Roux said there was also a GIS system in place where farmers could indicate the exact piece of land for which they required the equipment, and owners could monitor the equipment usage online.
Equipment owners can apply to list their services at any point and have the freedom to decide on the length of time the equipment is available for rental.
In the long-term, the aim is to deliver an innovative digital service so farmers can drive sustainability, profitability, and productivity for their businesses.