Connectivity Powers Tractor Supply Company’s Success

Tractor Supply Company’s many locations.
 
TRACTOR SUPPLY COMPANY

In late 2020, I had an intriguing conversation with Tractor Supply Company (TSC) and HPE Aruba. Founded in 1938, over 80 years ago, TSC has grown into the largest farm store operator in the United States. However, of particular interest to me was its rapid growth over the last five years—nearly doubling its revenue to $10 billion. Soon after the call, I made plans to visit Brentwood, Tennessee, just a short distance from Nashville. The visit was my first business trip since the beginning of the pandemic–needless to say, it was both exciting and a little nerve-racking. With all of that said, let’s dive into my experience with TSC. I will share some behind-the-scenes insights into the retailer’s success, particularly around its forward-thinking connectivity plans.

The digital transformation of stores, distribution centers, and support  

HPE Aruba plays a vital role in TSC’s overall wireless deployment plans. The farm equipment retailer recently launched an aggressive strategy to blanket its store locations with Wi-Fi coverage, with new Wi-Fi access points and outdoor antennas. According to TSC, this effort has enabled it to deploy mobile point-of-sale for line busting and fast access to product information. It has also improved the businesses’ side lot services, such as quick propane refills and contactless curbside delivery. For the latter, TSC is also leveraging Aruba’s Meridian location-based services application to auto-sense approaching customers to trigger order fulfillment in a matter of seconds. Additionally, TSC deployed a very innovative VoIP service called Theatro that provides a unified communication system for store employees, eliminating the annoying intercom calls heard at most retailers. As I visited a store in Brentwood and another concept store in Murfreesboro, I witnessed the power of how a rich investment in wireless infrastructure and applications helps employees be more productive and act more naturally with customers.  

From a distribution center standpoint, TSC operates close to a dozen facilities around the country. The retailer recently completed a Wi-Fi 6 upgrade that enables faster throughput, lower latency and more device support. It is a smart plan given the fact that industrial Internet of Things (IoT) sensoring will proliferate in the coming years, and disruptive applications will support more intelligent warehousing and logistics. TSC has also upgraded its wireless connectivity to Wi-Fi 6 at Brentwood’s corporate headquarters, what they referred to as the Store Support Center. The name speaks volumes to the retailer’s relentless focus in ensuring the success of its nearly 2,000 locations across the country. Wi-Fi 6 is supporting a range of applications from video conferencing, digital signage, a contactless check in process that integrates Covid-19 precautions such as a temperature check kiosk and contact tracing support.   

Rural broadband and community investment initiatives 

I am a firm believer that companies that give back to local communities reap longer-term rewards. The same can be said for TSC. Leveraging its massive footprint in rural America, the retailer is helping to bridge the digital divide. One of the ancillary benefits of densifying store Wi-Fi for improved operations is the ability to extend connectivity to its parking lot. This initiative has been invaluable for TSC customers to facilitate distance learning and telemedicine sessions in light of the pandemic. It is also worth noting that TSC launched its mobile app in 2020 and offered to donate $1 for every download to the American Connection Project (ACP). That resulted in one million downloads and a $1M donation to the initiative. Since the initial donation, TSC has generously agreed to contribute an additional $1M to the project. It is a fantastic program that can bring needed connectivity to rural America, something that the ACP cooperative has pegged at an astounding $80B price tag. 

I also had the opportunity to visit the Entrepreneurship and Innovation Center (EIC) that serves 10th through 12th-grade high school attendants in the Williamson County Schools district in Tennessee. The mission is to equip teenagers with the needed training and skills to pursue start-up opportunities for these future innovators as they move to college and beyond. TSC has not only made significant equipment donations for the EIC, but it has also helped with the non-profit’s formation as well as its executive mentorship. It is a novel concept and one I hope to see replicated in my hometown of Austin, Texas and other technology hub cities throughout the United States. 

Wrapping Up

TSC has managed to grow rapidly even during the challenging times brought on by the pandemic. It is an astounding accomplishment due in part to its investment in technology and savvy investigation of adjacent product sales opportunities. Executives have estimated that the company has only taken a 10% share of a total addressable market of nearly $110B. Based on the time I spent with executives, store managers and EIC leaders, I do not doubt that TSC will continue to grow by leaps and bounds. TSC’s pragmatic, humble vision of “Work Hard, Have Fun, Make Money” and its forward-leaning strategy to deploy best of breed HPE Aruba connectivity solutions across employees, customers, and the community, is a formula for success from my perspective. And if recent earnings posted late last week are any indication, TSC will continue its success.