2

A company’s progress across 95 years can be measured inmany ways. Business volume. Product lines. Market area.At Scharber & Sons Inc., these and other indices of growth

are viewed as evidence of good decisions made in thepast as well as harbingers of good things to come.

Obviously, the Scharber heritageextends beyond the 1950s. The

period between then andnow may be more

prominent in

Mike Scharber’s mind because it was a time of leadershipby contemporary family members — his grandfather DougScharber, his father Steve Scharber, and uncles Mark andPat Scharber. It also was a period of growth for the dealer-ship and for Deere & Company, as both companies experi-enced a level of prosperity that laid the groundwork andprovided a strong foundation to move into the future.

The development of the dealership and of Deere continuesin 2011.

Scharber & Sons now is part of Minnesota EquipmentSolutions, a merged group of five equipment dealers. Fourof the dealerships — located in a crescent around the

north and west sides of the Minneapolis-St. Paulmetropolitan area — merged in 2008 to solidifytheir regional position and gain advantages of scale.The fifth dealer joined the group last year. Scharber& Sons and the other partners in the group continueto do business in their respective locations undertheir original company names.

The roots of the Scharber dealership actually goback to 1836 when a struggling blacksmith namedJohn Deere moved from Vermont to a rural Illinoisarea that only recently had been secured againstremnants of marauding Indian tribes. In GrandDetour, Ill., Deere set up a metal-working shop, andthe following year he found a broken sawmill bladeand from it fashioned a self-scouring plow bottom.

He quickly realized the Sheffield steel plow wasexceptional because it cut cleanly through the rich,boggy Illinois soil without repeated stops to scrapesticky dirt from the plow bottom’s face. After manu-facturing the first polished-steel plow in 1837, Deerebuilt two the following year, 10 the third year, and by1842 was manufacturing 100 plows a year.

Service, Growth & Family Values Remain Keys to Success

President Mike Scharber (L) and Secretary-Treasurer Dan Scharberrepresent the latest generation of family leadership at the helm ofScharber & Sons.

3

In 1848, Deere and partners moved theircompany to Moline, Ill., and in 1869 openedthe first company branch in Kansas City,Mo. Other regional branch offices followed— one of them in Minneapolis.

Plows and GroceriesIt was from the Deere & Webber office inMinneapolis in 1916 that John M. Scharberbegan to handle Deere plows and otherimplements as part of his general merchan-dise and grocery store business in Rogers.Deere had been selling plows for 79 yearsby this time, but the company was still in itsinfancy. After all, not till 1918 did Deere buyout the manufacturer of the Waterloo Boytractor, paint the product John Deere green,and start selling it as a Deere tractor. Thatfirst tractor moved on steel-cogged treadwheels, had a water-cooled, two-cylinder

It’s a meeting across the family generations as (L-R) Otto, Doug, Steve and Mike Scharber, holding a mini John Deere tractor gath-er for a picture.

(L-R): Doug, Steve, Mark and Pat Scharber see the showroom expand with theaddition of lawn and garden equipment as they stand outside of the Scharber& Sons building in july of 1974.continued on page 6

4

Proud partners with Scharber & Sons for 95 years.

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5

6

engine that burned kerosene,and produced 12 horsepower atthe drawbar.

But Deere wasn’t the only com-pany experiencing the thrill ofseeing a business begin tothrive.

By the time Otto Scharberbought his father’s business in1929, both the Deere lineup ofproducts and the Scharber busi-ness had grown.

Renamed Otto Scharber &Sons, the company was a keycommercial enterprise inRogers, a then-rural HennepinCounty town of a few hundredpeople located 20 miles north-west of Minneapolis. This was

farm country. The whole area aroundMinneapolis has been an active agricultur-al region for more than 170 years.Minnesota farmers, many of them immi-grants from Germany, harvested their firstcrops in Washington County on the eastside of Minneapolis in 1840, about thetime John Deere was finding early successwith his plow.

So the rural area surrounding Minneapoliswas ripe for agricultural implement deal-erships and Scharber & Sons reaped thebenefits of that need.

There was plenty of work to be done tohelp keep the company growing strong.Otto Scharber didn’t have to look far tofind that help.

(L-R): Steve, Doug, Otto, Pat and Mark Scharber gather in front of a John Deere tractor in1975.

Lenny Schlegel, a loyal 63-year employee, is ready to help customer finds exact-ly what they need as he mans the Scharber & Sons’ parts counter.

from page 3

7

In 1938, another generation ofthe family came aboard whenOtto’s son Doug graduated fromhigh school in Elk River andjoined the business. It was a pro-pitious time for the company andfor the country. The worst of theDepression was behind. Theyears immediately followingsaw ramped up agricultural pro-duction to provide food staplesduring World War II, and thatwas followed by a period ofrapid mechanization on the farm.

Around the time Doug Scharberbegan working full-time in thefamily business, Deere had intro-duced the “A” and “B” modeltractors. The “A” had a 25-horsepower engine and a four-speed transmission. The tractorswere the most popular the com-pany ever produced, staying inproduction for 20 years withmany refining changes along the way.

The evolution of John Deere product linesand of the Scharber & Sons dealershipcontinues seven decades later. Changeshave occurred on many fronts. New mod-els and whole new products have comeout of Moline; entirely new commercialrelationships and markets have developedin Rogers, with the character of the com-munity evolving from agricultural to sub-urban.

On the manufacturing side, in 1960 Deereended its production of tractors with two-cylinder “Johnny Pop” engines and intro-

duced New Generation four-and six-cylinder engines. Thehand clutch went the way of thestudded steel wheel. At the sametime, Deere introduced the 215-horsepower, 10-ton diesel-pow-ered model 8010, the largesttractor Deere ever produced.

In 1970, lawn and garden equip-ment was introduced to theScharber & Sons showroom.The next year, John Deeresnowmobiles came to the floorunder the slogan, “Nothing runslike a Deere.” A dozen yearslater, the snowmobile line wassold by Deere, but the sloganstuck around.

The 1980s were, for Deere andthe country, marked by reces-sionary economic pressures that

Manager of Aftermarket Doug Anderson, has been with Scharber & Sons for 22years.

Scharber & Sons President Mike Scharber. continued on page 10

8

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The Scharber & Sons service crew are, front row (L-R), Troy Ball, Marvin Kubitz, Jerome Doroff, Mark Windsperger, Todd Johnson,Dan Durant, and Frank Russ, back row (L-R) Service Manager Pat Scharber, Bob Bachmeier and Kendal Braun.

The Scharber & Sons parts team of (L-R) Larry Urai (who’s in his 38th year with the company), Steve Riggs, Bruce Linden, PhilScharber, Joe Hegge and Rich Swanson is ready to help a customer find any part they might need.

11

discouraged expansion. Yet at the start of that decade,Doug Scharber had the dealership solidly diversified intolawn-and-garden equipment to meet the growing needs ofMinneapolis-St. Paul suburban customers. In 1981, he sold150 garden tractors. He also moved 25 to 30 farm tractorsoff the lot each year, with the 150-horsepower model 4450the biggest seller.

Business still was good enough in 1982 that Scharber andSons opened a new 150-foot by 200-foot sales and servicefacility on property just off Interstate 94, a site the dealer-ship still occupies. The handsome, pre-stressed concretebuilding was divided into sections for agriculture equip-ment and for lawn and garden equipment.

By this time, Doug Scharber’s sons were fully engaged inthe business. Pat Scharber set up the service depart-ment and still manages it. Mark Scharber is stillactive in sales, while Steve Scharber is semi-retired.

Steve’s son Mike is now company president and hisbrother Dan is secretary-treasurer and represent thelatest generation of family leadership at the helm ofthe company. The family tradition is continuingwith Mark’s son Phillip works in the parts depart-ment, and Pat’s only son working in the shop whileattending college.

Decades of Dramatic Change

As the 1980s were coming to a close, DougAnderson hired on as a salesman for Scharber &Sons. Twenty-two years later, Anderson is still there,now manager of aftermarket. Between 1989 andnow, Anderson saw the nature of the Rogers marketchange dramatically, with the dealership servingfewer and fewer agricultural customers and moreand more residential, commercial and contractorcustomers.“Lawn and garden was really just getting going 20years ago,” Anderson said while taking a break on a

busy Friday afternoon at the dealership. “There was amuch smaller line of machinery than we have today. JohnDeere has done a really nice job of expanding the productline and customer base.”

John Deere’s extensive line-up of commercial mowers hasall been introduced since Anderson’s first days in the busi-ness, and the utility vehicle product line has mushroomed.“When I first started, utility vehicles were really new. JohnDeere really invented that product with the five-wheelAMT 600 and 622.”

Those “all materials transport” vehicles were the predeces-sors of today’s popular 4- and 6-wheel Gator utility vehi-cles that can be ordered in various configurations includingwith camouflage coloring and dump bodies. Anderson matter-of-factly accepts the changing customerbase. “It is hard to pine for the past. I think of the farmers

At the parts counter, Rich Swanson (L) and Joe Hegge are always busyfilling orders and answering questions.

from page 7

continued on page 14

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fondly, but the fact is there are farfewer farmers so there are farfewer ag sales opportunities. Yetthere still are hobby farmers andcommercial entities and landscap-ers. Tractors still are being sold,but now to the county and thecity, and to schools for mowingand snow removal and fieldmaintenance.”

Company president MikeScharber describes the changingnature of the customer base interms of housing.“Everyone is planting homesinstead of crops,” he says. “I jokethat we are about one housing

Salesman Andy Bailey (L) shows Jeff Anderson of Grant, Minn., around the Scharber & Sonsequipment yard and specifically this John Deere 2720 tractor.

Scharber & Sons’ commercial salesman Jonathan Nordum is always ready to share his knowledge of John Deere equipment withnew and loyal customers.

from page 11

15

boom away from not being in the large commercial agri-cultural equipment business at all.”

He reiterates that the dealership’s tractor sales — modelsup to 120 horsepower — now are to largeproperty owners, county and city groundsdepartments, and commercial customers,with the model 6430 four-wheel-drive utilitytractor being one of the most popular.

While the Long Lake facility, which offersmore complete lines of equipment, wasalways a Scharber & Sons store, the HamLake and Isanti locations were part of the2008 merger. Like the Rogers dealership, thegroup dealerships in Isanti and Ham Lakeexpanded their offerings through the merger,as did a Savage dealership that more recentlyjoined the group.

Isanti now offers John Deere agriculturalequipment, while Ham Lake expanded toinclude commercial equipment.The Savage location added bothlawn-and-garden and commer-cial equipment to its lineup.

The entire group operates withabout 65 employees, more thanhalf of which work at aScharber & Sons location.

New ChallengesWhen Anderson looks back onhis two decades with the com-pany, he naturally notices thetechnological changes in theoffice. The paper forms onwhich he penciled in ordershave long since disappeared.“When I started, we had onecomputer in the booking officethat the whole business operatedout of. I didn’t have a desktop

computer for four or five years,” he recalls. “Today, every-body has a laptop, desktop, smart phone…”

In the late 1890s, J.M. Scharber opened a general store that first established the family namein the Minnesota business world.

J.M. Scharber’s general merchandise and grocery store as it appeared inRogers, Minn., in 1903.

continued on page 16

Part of his responsibility at Scharber is to coordinate sys-tems and practices among the merged dealers, much ofwhich is electronic. “There always are challenges when itcomes to merging organizations and putting practicestogether. There are simple but important things like makingsure the computers are talking to one another. We’re learn-ing how to deal with Internet sales and social media sales.We’re already looking to the future in talking about the

next generation of computer systems for the company andhow we can implement those changes.”

And, Anderson says, John Deere “has become a differentcompany. It interacts with its dealers much differently.There is less emphasis on field personnel, for example.Now we interact by internet and e-mail.”

A pivotal change for Scharber & Sons was, of course, themerger, a consolidation that they had envisioned andencouraged. The Rogers facility was the oldest and largestof the dealerships, but the other dealers also were firmlyestablished, having been around for decades.

“Some of the other stores couldn’t get some product linesthemselves, and generally, across the country, dealers aregetting bigger, not smaller. It was time,” he says.

Dan Scharber thinks the merger was a natural progressionof what was happening in the industry. As John Deeredealers in the area were merging, the company leaders feltScharber & Sons would be an ideal situation for anothersuccessful merger. “That was part of it,” he says. “Butfrom an inventory standpoint, historically we and the otherdealers have always competed on deals. By merging wecan better utilize our resources and move through invento-ry quicker.”

Anderson views the merger as a launching pad for salesgrowth.

Otto Scharber in the late 1930s feeding his flock of ducks. Lenny Schlegel in that late 1930s fixing a lawn mower.

from page 15

continued on page 18

16

17

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18

“We can specialize a little bit more now,” the manager ofaftermarket says. “Combined, we have a bigger operationand more staff. That means we don’t have to know every-thing about every product. We can expand and specializeusing our special talents, and leverage all that to sell moreto a bigger trade area.

“I see growth. With the additional locations, there is mar-ket area we can expand into. Several stores haven’t carriedmuch in the way of commercial and ag products and wecan expand the product line-up in those stores.”

Of all the challenges facing Scharber & Sons, the chang-ing face of its customer base is perhaps the most enduringone. Says Anderson: “Our bar keeps getting raised. Wehave to keep adapting to how people interact and purchasethings now, including on the Internet.”

This new customer dynamic manifests itself in such basicways as the appearance of the Scharber & Sons show-room in Rogers.

“Customers have expectations about having a nicer facili-ty to visit,” the after market manager says, “so we’veupgraded the facility over the years. We raised the ceilingin the showroom and added windows to allow more natu-ral light. We have had to spiff up our marketing in store

signage and displays. Our customers certainly are moresophisticated than they were 20 years ago.”

Statistics of ChangeThe numbers tell the story of Rogers’ changing demo-graphics. As it has become a commuter community, it hasbecome more affluent. The estimated median householdincome in Rogers in 2009 was slightly more than $89,000compared to $55,000 for Minnesota as a whole. Themedian house or condo value in 2009 in Rogers topped$300,000 compared to $200,000 across the state.

What this means for Scharber & Sons is that residentswith several acres planted in grass or short crop rows havesupplanted full-time farmers as the customer of choice.“We are catering to that next generation of large propertyowners, the part-time producer who works nights andweekends, possibly even less in the future with the everincreasing demands day-to-day schedules,” Mike Scharbersays.

The marketing goal is consistency, he says, steady salesrather than new markets. He recalls how when the hous-ing market collapsed three years ago, contractors wentaway immediately but the municipal business continued tobe a steady customer for two more years before it too feltthe impact of the recession.

from page 16

(L-R): Otto Scharber, Alec Weber and Lenny Schlegel loading another tractor for delivery

19

“The market we are going afternow in terms of our equipmentmix is pretty stable,” MikeScharber says. “We are con-stantly trying to find the rightmix of equipment to meet theirneeds. The equipment maycome from John Deere or fromsome other manufacturers.”

Scharber & Sons’ specialtyequipment lines include Fellingtrailers, Carlton stump grinders,and Woodsman wood chippers.These are product lines that thedealership sells across the state.

The list of non-Deere equipment also includes an articulat-ed implement carrier from Swedish manufacturer Belos.The swivelly machine is sort of a cross between a skid-steer loader and a tractor and frequently is utilized to plowsnow from sidewalks. Boasting hydrostatic four-wheeldrive and a comfortably warm operator cabin on a coldday, it can zip along at 25 mph between locations. Minnesota is a wintry region, after all, a climatic reality

that every business in the state must acknowledge in itsbusiness plan. The Twin Cities, in fact, has one of the cold-est climates of any metro area in the United States, with anaverage temperature in January of 4 degrees Fahrenheit,warming up to an average of 12 degrees in February,according to U.S. Climate Data.

continued on page 20

Otto Scharber farming after hours.

The 1932 Chevrolet “Mobile Grocery Store” allowed Otto to travel the countryside sellinggroceries door to door.

20

Scharber’s sales track the seasons. Lawn and gardenmachinery and similar equipment keeps sales and serviceemployees busy during the growing season, which rangesfrom April to October. Contractors warm up as the summerdoes, with John Deere skid-steer loaders, light excavators,material handlers, and other machinery moving to worksites

It is the winters that challenge machinery and implementdealers. During that season is when Scharber & Sonsincreasingly looks to local governments, school districts,and contractors.

That is the time of year when those customers are aug-menting and updating their equipment inventories, lookingahead to busier seasons to come. Much used equipment istraded in for new equipment as a new generation of JohnDeere machinery is prepared to take over mowing andsnowplowing tasks.

This seasonal cycle of activity has been playing out for 95years at Scharber & Sons in Rogers. Groceries and hard-ware no longer are mainstays of the business. Customerconsideration still is. Mike Scharber, who joined the familyfirm in 2000 after several years of working as a manufac-

turing representative after college, says “taking care of people” is the heart of the business.

“We’re all working at that,” he says of the Rogers storeand of other dealers in the dealership group. “We don’thave any partners or owners who aren’t working a fullweek. The biggest thing I like is working with a broad andlarge customer base, helping them get what they need. Ilike teaching them, helping them make a decision.”

He acknowledges that keeping intact the company’s 95-year legacy of sales and service is a challenge. He says thedecision to merge, for example, was perhaps not one hisgrandfather would have made. “I looked on it as doingwhat we needed to do to keep alive and strong and com-petitive. Grandfather might have taken different steps, butthat has nothing to do with right or wrong. It is just thechanging nature of business.”

The Community and the FutureThe wholesale makeover of Rogers in recent decades hasbeen a little surprising for natives of the town, like MikeScharber, who watched the community explode from1,000 residents to 8,000 residents in just 10 years.

It’s quite a change from the days when Otto recognized vir-tually every customer’s face and needs and also creates a

from page 19

Otto and Lenny pose for a picture in the equipment lot.

21

challenging situation for Mike and Dan to stay on top of anexpanding customer base.

Quips Mike: “It’s just seven thousand customers I don’tknow yet.”

He probably exaggerates, but there is no question theinflux of commuting residents and large property ownershas changed the character of the sales business.

“The composition has completely changed,” he says. “Ourcustomers now are more sophisticated, more short on timethan in the past. This changes the customer service andretention aspect of the business. But it still comes down tobeing a part of the community.”

The family has worked hard at good citizenship for a longtime as well as being actively involved in civic, service andcommunity organizations.

Doug Scharber was mayor of Rogers for 22 years begin-ning in 1957. (He also was president of the Minnesota-South Dakota Farm Equipment Association in 1983.)Doug’s son Steve was mayor for 14 years. Steve’s son Danhas served on the city council of Otsego. Steve, Mark, Pat,Mike and Dan Scharber are all longtime members of theRogers volunteer fire department.

Steve and Mark are both members of the Rogers LionsClub, contributing their time to help with fund raisingactivities to help better the community.

The company is very likely to still be leading the commu-nity in various ways when it reaches the 100-year bench-mark five years from now. Doug Anderson has spentalmost half his 50 years at Scharber & Sons; the after mar-ket manager is convinced that successive company leaders,like the “founders,” will keep the company on track.

“There seems to be a common trait through the years,” hesays. “That is, the company has always been very progres-sive in a business sense. Whoever is leading it never hasbeen fearful about seeing what the next opportunity is forgrowth and expansion. They do a good job of lookingahead.”

This forward-looking attitude has taken the John Deeredealership from groceries and plows in 1916 to implementsales of $50,000 in 1938 and $5.5 million by 1981. Butthose numbers aren’t the most important to a company thathas kept the family values it was founded upon and thebelief in community service that has helped complementthe business side of Scharber & Sons.

What began as virtually a one-man operation has grown toa company that now employs nearly 100 people.

In a challenging economy and constantly changing busi-ness climate, that’s the type of figure that might be the bestmeasure of Scharber & Sons’ success as it reflects on itspast while enthusiastically looking toward its future.

The 1938 delivery truck is ready for action.

22

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