You may remember that last week in this Weekly Update we ran a short survey asking you, our valued dealer readers, a pretty straightforward question: what makes you decide to take on, or walk away from, a franchise?
As always, there were plenty of interesting responses, but one in particular stood out to me because it seemed to sum up something we've heard repeatedly in our conversations with dealers over the years.
The dealer wrote: "First and foremost, the most important aspect is having a good and reliable product - but that alone is not enough. A good product is no good without the back-up and support from the manufacturer to go with it."
I suspect that single sentence will resonate with many independent dealers.
Manufacturers naturally devote huge amounts of time and money to developing new products. Specifications are improved, technologies advanced and marketing campaigns are rolled out. But going by comments like the one above, for the dealer, the product is only one part of the equation.
Once that machine leaves the showroom, a crucial relationship begins.
Can technical questions be answered quickly? Are parts available? Is warranty support fair? Is training readily accessible? Does the company pick up the phone?! When something goes wrong, does the manufacturer work with the dealer to solve the problem, or leave them to deal with an unhappy customer alone?
It sounds like these kinds of considerations make the difference between a successful franchise and one that eventually disappears from the showroom floor.
The same dealer went on to say that they had moved away from brands where the products themselves were good, but the support was "shocking". That's a powerful statement. It makes it clear that for some of our dealer readers, poor support can outweigh an excellent product.
And this isn't the first time we've heard sentiments such as this. In our informal, off-the-record chats on visits to dealerships or at shows, we've been told that trust is built over years but can disappear remarkably quickly. If dealers lose confidence that a supplier will support them when it matters, the relationship inevitably begins to suffer.
This particular dealer’s comments about pricing were equally interesting. Margin, unsurprisingly, remains important, but so too does creating what the dealer described as a "level playing field" between larger and smaller dealers. Nobody wants to be involved in a race to the bottom where discounting becomes the only way to win business.
And then there was one final observation that I found particularly encouraging.
The dealer highlighted a particular manufacturer as an example of a franchise where they can "price sensibly and still get sales, as people are more often appreciating face-to-face support."
That has always been the mantra of the network. Back in the day the boast was that they offered something more than the sheds, whilst more recently that they provide so much more in comparison to online retailers. Giving a service that these price-led retailers simply don't, the network has always prided itself on expert advice, product demonstrations, servicing, repairs and long-term relationships. In an age where so much purchasing has become digital and remote, it's reassuring to hear a dealer say that customers are still prepared to pay for that expertise rather than simply chase the lowest possible cost.
But of course, that's just one dealer's perspective.
I'd be interested to know whether others agree. Is a great product genuinely not enough anymore? Is manufacturer support vital when you're deciding whether to keep or drop a franchise? And are your customers still placing enough value on face-to-face service to justify paying a little more?
My suspicion is that many dealers will answer yes to all three. But I'd be fascinated to hear whether your experiences tell a different story. Please leave a comment below or drop me a line.
