DEALERS OR DIRECT?
Lely change tack in Scotland
by TurfPro Editor, Steve Gibbs
The news that Lely has terminated the franchise of three Toro dealers in Central Scotland has caused understandable concerns throughout the dealer network.
Here is a major franchise effectively saying "Sorry, boys, we can do a better job".
Now there are invariably two sides to every story. You might draw the conclusion that the three dealers involved were, collectively, not doing a good enough job for Toro, and deserved the chop.
Yet Lely's announcement appears to contradict this. It talks about "Maintaining the excellent customer service provided by these dealers . . ." and ". .our decision in no way reflects the performance of the businesses affected". Unless this is classic football manager sacking speak!
No, it is made clear that Lely/Toro have decided that they prefer to deal direct, cutting out established, service-focussed independent dealers with strong local followings.
Lely have had major issues in Scotland previously. Toro distributor, A M Russell, who covered virtually the whole of the territory north of the border, folded and went into administration in September 2000 to be replaced by three of the dealers now 'sacked' in the Central belt.
Two years ago, Lely stepped in to protect their Toro business in Sussex, by bringing their dealer JSM into direct control, but that was a matter more of succession.
It is generally accepted by most major suppliers that the most effective, efficient and satisfying route to market is through a network of highly regarded, service-focussed, well resourced, committed local dealers with whom they develop a close and, hopefully, enduring partnership.
Lely appear to be taking a different approach. It will not be unique and has been put into place elsewhere. However, it will be interesting to see how the deposed dealers, Toro's rivals and Toro customers in Scotland all respond.
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