Piippo bales service business into new growth

Piippo Oyj, one of the world's leading producers of baling nets and wires, has updated its strategy. In March this year, the 80-year-old company now invests heavily in the development of its Agri business and an even deeper understanding of customer needs. The aim of the development work was to get closer to the world in which farmers live. The updated concept was accompanied by the creation of the Focus on Feed service. 

Baling nets and wires are manufactured at the Piippo production plant in Outokumpu and exported to over 40 countries. The biggest export destinations are North America and Russia. Central Europe and the Nordic countries are also important areas for exports and growth. 

Baling nets and wires are part of Piippo’s Agri business that accounts for approximately 82 per cent of the company's total turnover. 

GoGlobal spinoff

The Agri market is fragmented on a global scale. Jukka Keisanen, Managing Director at Piippo, describes harvesting products as a niche market – albeit globally it is about EUR 480 million in total.

Piippo contributes to solving huge global issues. The world's population is growing. At the same time, the amounts of cultivated land, energy and water will decrease. 

- According to the calculations, agriculture must be able to produce more in the next 50 years than it has been able to produce in the last 10,000 years,” Keisanen explains.

In Business Joensuu's GoGlobal programme, Piippo’s first goal was to examine the development of its export processes. Very soon, the investigation of exports led to the development and then productisation of the company’s service business.

- When we joined the GoGlobal programme, we were able to describe our need and intent, but we needed external partners to dismantle and productise the matter.

According to Keisanen, it is no longer enough that Piippo is an efficient and reliable manufacturer of baling nets and wires. We need to go much deeper into the process – understand the genuine customer need.

- How can cattle be fed? Are the feed values met? What is the optimal time for harvesting the feed? We must be able to help farmers succeed better and more effectively than before.

Agri's schedule

Jukka Keisanen has been the managing director of Piippo since autumn 2017. Keisanen, who had previously worked with the company's exports, key customers and development, was already familiar with considering the customer's point of view. They were also able to find more agility, enthusiasm for development and expertise within the company.

Piippo went all out in customer orientation. The company synchronised its own financial period to be compatible with its Agri customers. The last financial year was finished at the end of September. Then a new one started.

- Our company is steered in terms of both production and sales in accordance with the annual rhythm of Agri customers. The solution is meaningful – now we combine the management of the company and internal systems precisely to meet the customer needs, the Managing Director says.

Focus on Feed

Focus on Feed – no feed wasted. It is not only the company’s guiding concept, but a cloud service developed by Piippo Oyj that enables dairy and livestock farms to optimise the amount, quality and correct harvesting time of silage. The driving force behind everything is minimising all waste.

- You enter the farm data on the level of parcels, its location, the number of animals and the desired crop in the cloud application. In the service, you can draw up a parcel-specific work plan, which allows the producer to prepare a harvesting plan. The application also supports statistics and, consequently, further development.

Focus on Feed software development progressed rapidly. The service has now been tested with domestic contracting partners and sales have been launched in Finland. Making the information technology and the system ready for export still requires certain changes and development. Before exporting, the service will also be tested globally on several farms.

At the core of Europe 

Piippo has a good geographical location for developing the Agri business.

- The global bale stock is quite European driven. Piippo's products are universally compatible in any market. The balers are developed by large European machine manufacturers. We are well aware of what kind of development work is being done in the market, Jukka Keisanen rejoices.

In Finland, there is a difference in the role of baling wires and nets at the core of Agri. Piippo's baling wires are extremely popular in the domestic round and square bales. When it comes to the baling nets, the market is more global and there are more competitors in the Finnish market. 

Piippo also responds to the competition by developing the product itself. The evolving weaving machine technology enables faster manufacturing with a higher volume than before. Piippo's baling nets are the longest and strongest on the market. 

Whether it is Agri products or consumer products manufactured by Piippo's subsidiaries or products manufactured for the cable industry, plastic is the material of choice. Today, the company focuses on the increasing use of recycled materials.

- There is a strong synergy between the manufacturing in different business areas – all materials can be recycled. There is no waste.

“We must be able to help farmers succeed better and more effectively than before”

Text Sirkka-Liisa Aaltonen/Viestintä Ässä Oy
Photo: Jarno Artika