Farmlands Cooperative: Sowing the seeds of innovation with autonomous agents in Dynamics 365

Farmlands Cooperative, New Zealand’s largest farmer-owned rural supplier, embarked on a multiphase digital transformation journey to streamline operations and enhance its customer experience. By implementing Microsoft Dynamics 365 solutions, including Microsoft Dynamics 365 Commerce, Dynamics 365 Finance, and the Supplier Communications Agent in Dynamics 365 Supply Chain Management, it improved efficiency and its ability to meet customer needs while continuing to innovate with agentic technologies. 

Finding fertile ground with Dynamics 365

Headquartered in Christchurch, the New Zealand cooperative serves over 79,000 shareholders through more than 90 retail stores nationwide. Established in 1962, Farmlands provides a wide range of agricultural products and services—from farm supplies and fertilizer to fuel, grain, seed, and real estate. With over 1,000 employees and an annual turnover exceeding NZ$2 billion, Farmlands is a top 20 company in New Zealand. 

The cooperative’s mission is to improve the individual profitability of its shareholders through collective negotiation power, offering exclusive rebates and loyalty rewards via the Farmlands Card. 

To better support its mission, improve efficiency, and protect the future of the cooperative, Farmlands consolidated seven ERP systems into a single platform based on Microsoft Dynamics 365, including Dynamics 365 Commerce, Dynamics 365 Finance, and Dynamics 365 Supply Chain Management.

These solutions, implemented in 2021, enabled Farmlands to unify customer data, standardize processes, reduce manual tasks, and deliver a consistent experience across all channels. The organization also launched a new shareholder portal, migrating over 60,000 existing shareholders to the new experience, and rolled out an e-commerce website to support both B2B and B2C customers. 

The company continues to build on its Dynamics 365 investment by driving further innovation with agentic technologies. 

An agentic approach to procurement 

As part of its continued innovation, Farmlands shifted to centralized purchasing across its retail stores. Previously, each store managed its own inventory and vendor relationships. With centralized purchasing, vendor interactions were no longer spread across individual stores but were instead concentrated into a smaller administrative team—creating the need for a more efficient, scalable solution.

“Our supply administrative team started managing orders, and we wanted to assist them in managing communications with vendors around standard changes such as quantity changes, price or pack size changes, or updated ETAs,” says Sean Barrett, Inventory and Analytics Manager of Farmlands Cooperative. “We really needed an intelligent agent that could automatically read communications from vendors and help make requested changes and then send out confirmation emails to the vendors.”

The Supplier Communications Agent within Dynamics 365 Supply Chain Management met the company’s needs. The solution streamlines procurement by automatically updating purchase orders in to reflect confirmation dates. The solution also enables autonomous communication with suppliers and vendors. When procurement employees receive a PO confirmation or change request from a supplier, the agent can read the email, summarize the changes for procurement staff to accept or reject in Dynamics 365, and draft an email for follow up on delayed orders.

By proactively following up with vendors on unconfirmed or delayed orders, the agent ensures timely communication and reduces the risk of stock being unavailable. This is especially critical in agriculture, where delays can impact farm operations and customer satisfaction. “AI‑assisted agents reduce manual effort while keeping our people in control. This approach delivers tangible value and unlocks efficiency across Farmlands and our partner network, strengthening collaboration and improving outcomes,” says Andre Scheepers, Chief Digital Officer at Farmlands Cooperative.

Reaping the rewards of AI automation

Since implementing Dynamics 365, Farmlands has realized improvements in efficiency, customer focus, innovation, and agility. Streamlined, standardized processes and improved data-driven decision making have empowered staff and shareholders with actionable insights and expertise. 

Previously, a Farmlands purchasing employee needed to open the vendor email on one screen, and then open Dynamics 365 to find and update a purchase order. Now, the agent automates and streamlines the review of 50–60 daily emails related to PO changes or confirmations, and assists in drafting approximately 70 emails to suppliers each day to confirm orders and follow up on delayed purchase orders. 

“At least 50% of our email traffic related to purchase orders is handled by the agent. Across the team, Dynamics 365 will save us a total of 20 hours weekly. The big benefit in time savings is that the agent has read the email, found the order, found the lines affected, decoded what the vendor is trying to say, and recommended actions,” says Barrett. “If you're happy, you just push a button. What used to take minutes now takes seconds. It’s a game-changer for our purchasing team.”

Communication accuracy has also improved dramatically, with the agent now able to correctly interpret and act on 70–80% of relevant emails without additional training. Further improvements are expected as they refine the system. 

Ensuring agricultural products are always in stock 

With unified processes and systems and better visibility into procurement and supplies, Farmlands is already seeing a positive impact on customer satisfaction. For instance, because of the efficiency and accuracy of the agents, more orders are confirmed in the company’s customer-facing app, which customers can use to order products. As a result, when products appear in stock online, the agent helps ensure the products are actually stocked in stores. 

“The big improvement is when customers come into the store and the stock is there, whether they’ve ordered it specifically or it should have been there on the shelf,” Barrett says. “We would hope that they wouldn’t notice it apart from, ‘I went in and I got everything I needed, or I was given an accurate estimation of when that stock would be available to me.’ They won’t even notice the change. Everything will just work.” 

This is especially important because customers are often in rural areas and travel long distances to visit a store. “Because we’re in the agricultural industry, farmers can travel up to 100 kilometers to get a product that’s important for farm work. It’s important that we have that product in stock,” Bennett says. “We can ensure that happens with the better visibility we have with the agents in Dynamics 365.”

What’s next 

Farmlands is optimistic about the future of AI-driven automation. Beyond the Supplier Communications Agent, the cooperative is committed to continuing its digital transformation journey, with plans to further use AI, Microsoft 365 Copilot, Copilot Studio, and agentic technologies to drive innovation and efficiency. 

Future phases will enable additional capabilities, including ratings and reviews, intelligent recommendations, personalized commerce, integrated marketing, and experimentation. The organization is also considering new agents to assist with reporting, analysing downstream impact of changes to a purchase order, on-time delivery, and EDI management, ensuring that Farmlands remains at the forefront of agricultural technology. 

By embracing Microsoft Dynamics 365 and agentic solutions, Farmlands has positioned itself to streamline downstream operations, deliver enduring value to its shareholders, empower its staff, and lead New Zealand’s agricultural sector into a new era of innovation and growth. “Our partnership with Microsoft has been instrumental in enabling Farmlands’ digital transformation,” says Scheepers. “By standardizing on Microsoft Dynamics 365 and thoughtfully applying agentic AI with humans firmly in the loop, we are creating a more efficient, resilient, and scalable operating model.”