Value wanted

Whether superintendents purchase generic or name brand pesticides, service remains key

Golf course superintendents are no strangers to spending money wisely. They find ways to save money and still produce well-manicured golf courses. One of those ways is to purchase generic or post-patent pesticides. According to a recent Golf Course News survey of 400 readers, 59 percent say they buy generic pesticides. However, some question the service that comes with purchasing them. Pesticide suppliers say there are pros and cons to the generics available on the market.

Choice is good, according to Mike Daly, director of marketing, green for Bayer Environmental Science.

“The end-user having choice is a good thing, and there’s nothing negative about it,” he says. “That’s the market we’re operating under.”

Owen Towne, president of Phoenix Environmental Care LLC, says the number of products coming off patent is important to superintendents because it makes the number of purchasing choices available greater.

“Three of the top five fungicides, four of the top five herbicides and three or four insecticides are coming off patent, making key compounds available,” he says. “Primo and Merit are two biggies that are coming off patent this year or next. Whether that’s good or bad depends on how superintendents spend their money. Most people agree that choice is good, and off-patent products give superintendents a choice.

“As a generic manufacturer, my concern is other generic manufacturers selling solely on price point and not trying to enhance the product or support the market,” he adds. “If superintendents are strictly buying on price, they’ll be buying from companies that don’t support the industry.”

Towne says the larger companies that offer patented or brand-name products, such as Syngenta and Bayer, have done an excellent job of telling their story about supporting the industry through loyalty programs and financial support of associations and seminars.

“I came up through Ciba and Novartis, so my view is that Phoenix balances industry support and enhancing old formulas,” he says. “We’re saying superintendents should be buying more than the active ingredient because suppliers and manufacturers are doing a lot of work to make the active ingredient as strong as possible. There’s a segment of the market that will always buy the cheapest product and another segment that will always buy branded. We recognize those two groups but believe there’s a segment that wants to save money and support the industry.”

From a distributor’s point of view, Towne says competition from generic manufacturers puts more pressure on price.

“People used to say all generics are alike, but that’s not the case,” he says. “Superintendents need to look at the label and look at the pesticide on a case-by-case basis. On the [agriculture] side, the number of generic manufacturers has been common since the 1980s; but in the specialty segment, the increasing number of generic pesticide manufacturers is relatively new.”

In 2004, less than 8 percent of the pesticide market in the golf industry consisted of true generics, according to Gary Curl, president of Specialty Products Consultants LLC. Curl qualifies true generics as post-patent products supplied by a manufacturer other than the original patent holder.

Statistically, the number of generic products available and the distributors for those products has increased significantly during the past three years, according to Joe DiPaola, Ph.D., golf market manager of Syngenta Professional Products. However, DiPaola says sales of generics declined from 2003 to 2004 partly because superintedents understand the need for high-quality products from a primary manufacturer and the value of that.

“It’s more than a name,” he says. “It’s the intangibles such as access to people when you’re in an emergency, counting on the product for what it is, being delivered on time and the relationship with the channel that delivers the product.

“If there is an environmental emergency, who can analyze the soil?” he adds. “That’s not a simple or cheap thing to do. If there is a fire or flood and you have pest control products involved … it becomes a people thing as opposed to how much a case costs.”

But companies such as BASF try to solve some problems with generics.

“We offer both proprietary and post-patent products and use plants, technology and quality assurance to make sure the quality is there,” says Kyle Miller, senior technical specialist for BASF Professional Turf & Ornamentals. “We have a lot of people with formulator expertise behind the generic products we offer.

“Superintendents are much more inclined to look at post-patent products because there’s a lot of that kind of product in the market and budgets are tight,” he adds. “Those are two reasons why superintendents are looking at generics now, more than they have in the past. But you still have superintendents that don’t look at post patents because they’re comfortable with name brands.”

The golf industry is past the midpoint of the generic influx to the market, according to Bill Brocker, v.p. of marketing for PBI Gordon, but he hasn’t seen generics make much of an inroad and says relationships are key.

“Whether the chemistries superintendents use are on or off patent, they value the relationship with suppliers rather than the absolute price,” he says.
Brocker agrees with Towne and says some generics aren’t good from a service standpoint.

“Whether the companies that sell generics are able to provide the service superintendents need depends,” he says. “As companies’ margins go down, it’s harder to keep tech support in the field. There has to be a level of service if you’re selling to professionals. What will work in the ag market might not work in golf.”

Nick Hamon, director of development and technical services for Bayer Environmental Science, says generics and their encroachment in the golf industry is always a concern for the company.

“However, Bayer differentiates itself by the quality of our products and the technology and guarantee behind them, as well as the technical support we provide to customers,” he says. “Sometimes generics can work, but there is a risk attached – the cost savings may not outweigh the associated risks.”

Whether generics are good or bad depends on the number of players and the discipline they have, according to Tom Kroll, insecticides and fungicides product manager for Arysta LifeScience.

“The concern is the issue of servicing and the need to retain value,” he says. GCN

Buying name brand vs. generic pesticides

• Know what you’re buying and how to apply it correctly. Have you used the product successfully in the past?
• If you need technical support, find out what support is offered or available before buying and using the product. The level of product support requires research, such as with branded products. Companies that only sell generic products might not be capable of supporting you as much as companies who produce generics and branded products or just branded products. There are various levels of support to consider: manufacturer, distributor and formulators. Ask the company selling generics if it will provide performance guarantees.
• Cost is an important factor. However, if a product doesn’t perform well and there are no performance guarantees, the result is no monetary savings, and you’ll incur additional costs by having to purchase more product along with the labor costs to reapply. Cost is easy to compare once you understand and compare a product’s active ingredient. The main cost drivers are: quantity of active ingredient in the container as a total percentage and the quality of support from the manufacturer that is going to be offered.
• A common myth is that generics don’t perform as well as branded products. However, to receive EPA registration, the active ingredient in generics must have the same technical merit as the current manufacturer branded product.
• Check the formulation. Sometimes generics are formulated slightly different than the branded product, therefore, you must read the label carefully to make a direct product comparison.