There's clearly only one topic of discussion this week.
Today we want to hear from you, the independent dealer network – what do you think about STIHL's decision to begin selling their battery tools through Screwfix nationally? And not only sell, Screwfix will apparently also have their own service facility for customers to use also. Although Screwfix customers are within their rights to ask a STIHL dealer to carry out warranty – (no doubt adding to the on-going dealer rumblings over rates paid).
Therefore, our request to you our dealer readers today is, please tell us what you think of this news. Do you see this as a seismic event in the long and storied timeline of the industry? Has it fundamentally changed the market – and importantly your outlook on STIHL?
Or have you shrugged your shoulders, raised an eyebrow and muttered something along the lines of ‘I knew this was coming’?
What have STIHL said?
Speaking with the company this week, STIHL said to us at Service Dealer that going into Screwfix will introduce their products to a sector of the buying public who may not have heard of them before - and more to the point, who will not have entered a specialist garden machinery dealership. The manufacturer claims this is partly a ‘brand awareness’ exercise. They believe this could indeed have a positive effect on dealers in the long run, via the visibility of STIHL products increasing.
Is this a theory you buy into?
Apparently, Screwfix’s app-based model of selling gets something astronomical like 2.9million users a week – so that’s a lot of eyes on STIHL products. Will this benefit the servicing dealer? Or will it just mean a lot more products sold through Screwfix?
STIHL stressed to us that no petrol products will be sold through the mass retailer. With this move, initially we at Service Dealer assumed the company's desire was to keep professional end-user customers going through the dealer channel, with the entry-level consumer using what we used to term The Sheds.
However, on closer inspection of the official statement issued to the press on Wednesday, the company says that "STIHL electric and battery powered tools", will be sold through Screwfix - with no specific emphasis on what level of battery product.
We spoke to STIHL as the news broke, and whilst they were keen to stress to us it was a partnership more oriented to domestic-level battery tools, they did confirm that as well as the AI and AS ranges, it would also include the AK range and some of the "entry level" professional AP range.
I asked Key Green, STIHL GB md, what she thought the reaction from their dealers would be to the Screwfix news? She predicted an ‘emotional response’ perhaps. But she compared this change to when the company launched their direct selling site, saying that move had initial trepidation, but is now viewed as complimentary to the dealer network.
Is that how you view it?
Kay told us at Service Dealer, that the company has no desire to start a price war. Although of course, they have no sway over what prices Screwfix choose to set the products at.
She said STIHL needed to fish where the mass consumers are. Those customers she said, are not visiting dealerships anyway. These are people who want the convenience of ordering via an app, rather than the specialised customer service available from the network.
We were told that STIHL were tapping into Screwfix’s customer base, and not the other way around of Screwfix pinching customers from the dealer channel. STIHL told us they believe that this news will have little impact on dealer sales.
Do you agree?
I also asked Kay if we can read this news as the first steps that STIHL might be taking, away from the dealer network entirely?
I was told absolutely not. “Dealers are our priority,” said Kay.
This, of course, has a familiar ring to it. Ourselves at Service Dealer, alongside many members of their dealer network, heard similar from Dr Stihl himself at the recent opening of their huge new Contra House building in Camberley. At that event, which had been delayed from November so the timing wasn't ideal, the partnership between themselves and their network was celebrated and lauded throughout.
At no point was there any mention of an upcoming partnership with Screwfix.
What now?
We had an entire edition of Service Dealer magazine printed and ready to be posted, reporting on what was said on that launch day at Contra House - which we've now had to scrap in light of this news. So forgive us, but your next copy will be a couple of weeks late as we reflect what has happened this week and your reactions in those pages.
I suppose one shouldn’t be surprised at a business decision taken by a huge multinational corporation to increase their profits and profile. They want to sell more of their products to as wide a customer base as possible. Screwfix fits those criteria.
The question for us as a trade journal, is how that affects our dealer readers? Presumably, however much the intention is to not start a price war, an independent simply will not be able to compete on price with the warehouses-full of product that Screwfix will be able to buy from STIHL. So I guess we’ll see the lower-end domestic machines begin to disappear from dealerships?
Is that a fair assumption?
But what about some of the more powerful battery tools, if those are also going to be available through Screwfix? Might they be under threat in dealer showrooms? Screwfix as a business most certainly positions itself as one used by professional tradespeople.
More widely, we’d be interested to hear if this impacts your overall relationship with STIHL and your feelings towards them as a supplier? Are you shocked? Disappointed? Or maybe you’re just inured to decisions like this made by big corporations?
Is this indeed a watershed moment for the industry, similar to that £99 petrol mower in B&Q all those years ago?
Another avenue worth considering is what impact might this have on manufacturers of a similar ilk to STIHL? Will they now follow suit into the mass channels in order to keep up with their competitor? Or will they see a potential gap left in the dealer channel by STIHL and seize that as an opportunity to form closer bonds with the network?
I've already heard from some members of the dealer network with their impassioned responses - but we'd love to hear from as many of our dealer readers as possible today. Whatever your view, this is certainly a bold move by STIHL.
Please let us know what you think, either in the comments below or, if you prefer to remain anonymous but would like your opinion heard, feel free to drop me a line in confidence. We'll make space for your say in our re-jigged and re-printed (and late) upcoming edition of the magazine.
Thanks in advance for your feedback.
