Williams Gin & Grain Inc.
For the first few decades that Williams Gin & Grain Inc. was in business, it had a small office in downtown Frost, Texas—a rural town about an hour south of Dallas-Fort Worth. The office was off the beaten path and did not have a retail area. The customer base was made up mainly of local farmers and ranchers, and the company’s primary business focus was on its cotton gin and grain elevators.
In 2006, Williams Gin & Grain built a new facility on Highway 22, one mile west of Frost. The new facility added a complete retail farm and ranch supply store, and thanks to the visibility of the location, the retail business took off.
“The old saying of the three most important things for a successful business are location, location and location has never been more true,” says General Manager Todd McGraw, one of the seven farmers who own the company.
A smart business move
The new location off of Highway 22 includes a 12,500-square-foot building with 4,500-square-feet of retail, 2,200-square-feet of offices, 5,000-square-feet of warehouse space and a 1,200-ton dry fertilizer blending plant.
The new facilities and location were a turning point for Williams Gin & Grain. The increased product lines and services expanded the company’s customer base even beyond its expectations.
Prior to its new location, Williams Gin & Grain didn’t have a credit card machine. Customers either paid cash or had an account and were billed monthly. With the new store, Williams Gin & Grain added a credit card machine, but longtime customers still pay with their grandfathered-in accounts.
So now, when monthly credit card charges sometimes reach as high as $50,000, McGraw knows that all of those charges are from newer customers.
“This move and a commitment to our customers have kept Williams Gin & Grain’s business sustainable even as consolidation, low commodity prices, added regulations and weather challenge the agriculture industry,” McGraw says.
Hyperlocal service and advice
The company’s original owner and namesake, J.O. Williams, was a key figure in the cotton gin industry and was president of the Texas Cotton Ginners Association in 1985. Williams was committed to his customers, and that commitment remained when, in 1984, he sold the business to a group of farmers, who formed a sub S corporation, which passes income, losses, deductions and credits to its shareholders.
The grain elevators and the cotton gin continue to be vital to the business, and the company has many longtime, loyal customers from the Texas counties of Navarro, Hill, and Ellis who bring their grain and cotton in at harvest.
Williams Gin & Grain strives to be a part of the community it serves, and the company is a proud supporter of local community endeavors, such as county fairs, school activities and the local volunteer fire departments. “We do believe our success is dependent on the success of our customers,” McGraw says.
Local ownership has its advantages, he says. “We get to make decisions right here and right now. We are focused on our customers and what we can do to provide things that have value to them.”
Because Williams Gin & Grain’s employees are local, too, they have a good working knowledge of both the area and the customers. “They try to give helpful advice and to get answers for any questions our customers may have,” McGraw says. “They try to be more service oriented and not just focused on selling.”
As a local company, Williams Gin & Grain is not geographically diversified. However, it is diversified within its business operations. Some years its grain elevators are kept busy thanks to higher grain yields, and other years, its cotton gin is more active because of higher cotton yields. “We also like to say we are a ‘seasonal business,’ however we have something to keep us busy for every season,” McGraw says.
Small businesses face many challenges, and Williams Gin & Grain is not immune to them.
“All of agriculture is suffering from low commodity prices, which are making it very difficult for all farmers to be profitable,” McGraw says. “The low profitability of farming, increased regulation and consolidation of major agricultural companies all tend to add to the uncertainty of where we are headed [and] the sustainability of agriculture.”
In the Frost, Texas, area, record rainfall in 2015 and too much rainfall in the spring of 2016 damaged crops. Both years required significant replanting, which added to farmers’ costs, but didn’t produce increased yields. That, coupled with the low prices, was devastating to the area, McGraw says. “Most everyone has had a couple of years of losses, and right now the prospects for profits for next year do not look that good.”
McGraw remains optimistic, though, and he hopes things will be better in 2017. In his ideal scenario, the Trump administration will be more business-friendly, the weather less extreme and the commodity prices higher.
“We have a lot of investment both financially and emotionally in our business and our farmers, as well as in their operation,” McGraw says. “Business has been good for so many years and you know these times will come.”