HAS THE PENNY DROPPED? Focus back on dealers as suppliers shift from the sheds
Has the penny finally dropped that servicing dealers are important (no, essential) to the industry? Silly question perhaps but inevitable as we have seen dealer numbers fall over the past 20 or 30 years both here and in the US.
The trend has flattened in recent times, not too many have shut (retirement being the principal reason), but few new dealerships have appeared.
The evolution of the servicing dealer has been fascinating.
In the early days, a manufacturer (Atco) set up its own service network, and that spurred the growth of dealers who spotted an opportunity.
Then came the superstores who used garden machinery as a seasonal door-opener. They had the power to drive hard bargains, and the die was cast when petrol mowers crashed below the £100 mark. All of a sudden, the machines were unserviceable economically - and that was when you had a shake-out of dealer numbers including some well-known names. The superstores abdicated their responsibility for service, taking back ‘faulty’ products without question - which were then often reworked by opportunists and returned to the market.
And now the internet, where many of the sales have shifted, mostly at the expense of superstore business. The difference is of course that dealers can get involved in online selling should they choose.
It is clear that manufacturers have started to distance themselves from the mass trade, partly due to them sourcing own-label brands - and also for economic reasons.
Recently in the US, Briggs & Stratton decided to withdraw their Simplicity and Snapper brands from the mass trade because the volume didn’t justify the return. CEO Todd Teske, (who we will be talking to in depth for the first issue of Service Dealer Business Quarterly) said, “Our focus is on dealers - the dealer is a really critical part of the ownership experience”.
The majority of manufacturers are not in the volume business, nor are dealers.
Perhaps we are witnessing another turn in the screw of dealer evolution. But if manufacturers pull away from the mass trade and up their reliance on specialist dealers, will there be enough dealers to take up the challenge?
