If you've had a look down the stories in our Update today, you'll have seen it's the quite the week for developments in our sector.

Honda cutting the size of their network, dealer buy-outs, various dealer franchise realignments, LAMMA moving their date for next year, and SALTEX testing the water for what must be an inevitable schedule change for themselves as well. Never a dull moment.

Which has been the case all year - and this was reflected back to us here at Service Dealer on a closed-call we held with a panel of dealers from around the UK this week.

We kept the call private and won't be disclosing who participated as we wanted an open and honest discussion to take place. We wanted the dealers on the call to feel they were able to speak frankly about what kind of season they've experienced, the support they've received from their suppliers and what concerns they have going forward.

After the call, Service Dealer owner, Duncan Murray-Clarke who chaired the discussion, said, "Our dealer call this week was so productive in terms of discussing the positive elements some manufacturers have displayed over the season, as well as evolving dealerships to take on the future.

"We will be working closely with a dealer panel over the coming months to investigate opportunities and in particular ways dealers can maintain revenue and healthy margin levels to support their overheads. If you would like to be considered for the panel please do let us know.”

Strong year for dealer business

To start with we heard some mostly very positive news about how overall business had been for these dealers this season. With all that's gone on, 2020 could have been an utter disaster. I think many were fearing the absolute worst for their dealership back in March, when remember, it was wasn't clear initially if doors were even allowed to remain open!

However as the year progressed, from what we were told, it has been a much better season than anyone had the right to expect. For domestic, and surprisingly also for commercial dealers, at worst the consensus seems to be business has fared the same as 2019. For many of these dealers though, they are saying they have surpassed last year.

Things are slightly different for agricultural machinery dealers however, with the well documented downturn in tractor registrations year-on-year. These guys have been incredibly busy keeping their farming customers farming - there just hasn't been the new machine sales.

This successful season for the grasscare side hasn't come easy though. Many spoke of the physical and mental stress they have been under, both to keep the business afloat initially - and then to push on. Aiding many in this has been the use of new, digital tools. The value of using these methods to establish the dealership in the hearts of minds of the local community was stressed. With the help of these methods, and other old fashioned traits of dealer ingenuity and entrepreneurship, many have caught up on ground lost during the height of lockdown.

One frustration which we heard repeated though has been the delays in supply, or the lack of stock, during the past few months. There have been times, we were told, that showrooms have never been more empty. Clearly there is an understanding why this disruption to the system has occurred - but for many, with customers chomping at the bit, it's been a real issue. An issue which may have prevented a good season becoming a blockbuster one.

Despite this though, it was genuinely heartening to hear just how well many had done, under quite exceptional circumstances. It reaffirms what we've always known - the network is a resilient and industrious entity. This has been proven many times over this year - arguably more so than by some of their suppliers.

Issues with suppliers

Because turning to less positive things, that word which we've used on here in recent weeks, disintermediation, was discussed. It was something which dealers of domestic machinery could definitely relate to. Once again we heard the concept referred to as a stealthy threat to this sector. Dealers in the homeowner market spoke of, without doubt, losing sales to their own manufacturers who were offering discounts or packages which the dealers simply could not afford to match.

It's not an issue on larger, more commercial kit we were told. It's the smaller, usually battery-powered products, which can be sold online in boxes and shipped directly to the home consumer, where the problem is arising.

We heard from dealers who are concerned that certain manufacturers are overlooking how important it is, that the network remains profitable. They need margins in order to pay skilled staff to keep their service departments running. A department which the manufacturers are relying on to be there to support the products they've sold direct!

It's clearly a frustrating and concerning state of affairs. Both sides need each other - but some dealers of domestic machinery are telling us they are not happy with the actions of particular companies. Both in terms of disintermediation and the levels of support offered this year.

Credit where it's due though. We did hear dealers speak up on behalf of certain manufactures who they cited as really stepping up and being there for them during this unsettled period. Both Stiga and Yamaha were singled out for praise.

The question arises, if this conflict of interest is as real as we're being told, what can be done to work it through? It was suggested that dealers should think about increasing the levels of constructive feedback they offer their suppliers. Opinions and ideas of how solve the issue, rather than just grumbling and not doing anything about it, was raised as something helpful which dealers could do. 

Retailers for whom it's possible, are apparently looking to concentrate on the bigger, more professional end of the market. The customers for those products are always going to require a dealer contact and won't be tempted to buy direct online. The problem with this approach of course, is it won't work for everybody's business and there's always going to be a limit of the number dealerships required to sell this machinery.

One feels that this will inevitably prove to be an ongoing point of discussion. If the sale of domestic, cordless machinery is a diminishing market for specialist dealers, one suspects that the shelves of showrooms around the country could begin to look quite different. Other revenue streams will be sought.

Diversification is a term not unfamiliar to the network and perhaps it will become a topic we'll be discussing a lot more over the coming months and years.