John Deere's poor dealership decision making IMO.

[Kyle_in_Tex]

Here in Texas, Deere has already forced smaller dealerships to either buy other dealerships, or sell your own dealership. Our dealership had been family owned since like 1936.

So now, there are these "entities" that own multi-dealerships, reducing competition. Some "wet behind the ears" board member/s at Deere must have come up with this idea.

Now the word on the street is that Deere wants to get down to maybe only 4 "entities" to own all the dealerships in Texas.

While this may give corporate Deere some advantages, I for one, don't subscribe to it being better for the little guys wanting a compact tractor.

I would like to hear from some of the guys on the inside of these dealerships and how they feel about the pros and cons of this corporate move.

What will happen to Deere long term due to this?

 

[Dadnatron]

It's a corporate, MBA mentality. Cut until the turnips into mush, then squeeze until the blood is gone. Take the stock bonus perks and move to another company.

Same thing is happening in Medicine, only worse. Hospitals have a non-profit status in most instances, and in order to remain in that category, they have to spend that 'profit' every year in some fashion. So they are buying everything they can find and building new 'ambulatory centers' on every corner. Make no mistake... it cannot be maintained but it is the way of the world at this point.

Narrowing the number of dealers gives JD better control over quality and more importantly, over who is selling and how they are selling the hugely profitable 'parts and maintenance' of their machines. Combine that with the electronic 'handcuffs' that JD has on their tractor software and keeping control of 4 dealers 'too big to fail' is much better than dealing with 'mom and pop' dealers of all sorts.

I don't like it at all... but it is a control thing pure and simple.

 

[buickanddeere]

Not just Deere . It is what is being taught in universities across the nation . With fewer family farms and more BTO it should not be a surprise .

 

[Ritothebull]

On the one hand it sucks, on the other hand, many of these small dealers are struggling so something is better than nothing.

 

[vvanders]

This is what happens on the auto side today. When we were last shopping cars none if the dealers wanted to bargin until we mentioned we were talking to dealers in Oregon. Changed their tune quick.

Found out afterwards they are all part of the same parent company despite completely different branding.

 

[Kyle_in_Tex]

Not just Deere . It is what is being taught in universities across the nation . With fewer family farms and more BTO it should not be a surprise .

"Bachman Turner Overdrive"?


All kidding aside, I believe Deere might end up selling only large stuff and combines...If this is the case, they could close half the dealerships.

Our dealership is dependent on hay farmers and stuff mostly smaller than 125HP.

 

[atsah]

Massey is losing ground along with Mahindra here in Maine. We have a HUGE JD dealer that has three locations and sells Kubota as well. They sell tiny tractors to monster tractors and everything in between. And they are family owned and a good family I might add. I have bought parts for Deere there that would cost twice as much if it were a Massey part, JD and Kubota has Maine pretty much rapped up, the others are being driven out.

Massey, Mahindra, Kioti and NH, LS are not something most people with buy here because there is no support and the Deere dealers know it..

 

[RickB]

Dealers are told by manufacturers they are either fish or bait. Make up your mind.

 

[beenthere]

Goes with the trend that we are all to be cared for by the Gubmint. The Gubmit has control of the farmers.. the mfg's through the EPA, etc., etc., etc. And so it goes.. and goes.. until our great grands just are the victims. We have allowed it to happen, slowly but surely.

 

[Kyle_in_Tex]

I believe it lies in between the wet ears of the young ones, trying to come up with ideas to squeeze more blood from a rock.

 

[Industrial Toys]

Same thing here.

It's good that a dealer can draw expertise and inventory from various locations. Although more often I think it just becomes another cluster F$%$%.

But small (solid) dealers can weather a poor economy or Ag crisis better.

I just hope they keep answering their phones.

 

[MORRISONSTEEL]

OEM greed does not explain this phenomenon. The future of farming and the staggering amount of knowledge required is a pretty big deal and the dealers survival counts on them getting over that hurdle. I don't believe that a small store is better equipped to handle a really big downturn either. It's a group support system across multiple locations that keeps dealers in small towns not the other way around, imao.

 

[ovrszd]

OEM greed does not explain this phenomenon. The future of farming and the staggering amount of knowledge required is a pretty big deal and the dealers survival counts on them getting over that hurdle. I don't believe that a small store is better equipped to handle a really big downturn either. It's a group support system across multiple locations that keeps dealers in small towns not the other way around, imao.

I absolutely agree.

Kyle didn't say, but I'm guessing Ag-Power inc now owns his area dealerships? Ag-Power inc just purchased our local dealerships. I'm in Northern Missouri.

This consolidation by Deere started several years ago. This is the second generation. Our local family owned dealership was bought out 8 years ago or so. Immediately inventory improved. And more significantly parts availability improved.

I don't fear this. I've experienced it in the Deere Construction dealer network for 25 years. If we decide to purchase a new Deere road grader chances are Murphy Tractor has the one we want on one of it's many dealer lots.

 

[Industrial Toys]

I disagree that a small dealer in good financial shape can't weather a crisis better. Cut back a few hours, let a person or so go, cut expenses and dim the lights. Big place, it's go full throttle or crash in flames! In the big business model, if you even don't grow, you're in trouble already.

 

[ovrszd]

The electronic world we live in kills the small dealership. Sitting here on my computer I can find the equipment and/or parts I need. For parts I can have them in my hand within 3-4 days. The small dealer can't afford to stock that part that he may only sell one of in the next year.

The only chance of survival in hard times for the small dealer is if it's old family money and no debt. Even then he won't have a Deere sign in front of his store long because of his low sales numbers. He's doomed.

In good times he struggles to keep up because of the gigantic credit line needed to stock those 1/4 million dollar machines. Again, he's doomed.

 

[Industrial Toys]

In a sense, the electronic age is the ONLY reason little guys (me included) stand a chance. I can get a lot of information on line, unavailable before, and can have something not in stock, tomorrow, maybe!

With what I hear about a financial crash imminent, We're all doomed!

 

[ovrszd]

If enough people believe the sky is falling, it will.

 

[shooterdon]

JD is not going to do stupid things that affect their bottom line. At least not on purpose.

They will be keeping dealers that meet their expectations and those of their customers. If a small dealer loses his franchise, it is part of business.

Look at the demise of Pontiac, Oldsmobile, Hummer, Saturn, etc. It happens

 

[Oldoak]

With what I hear about a financial crash imminent, We're all doomed!

Not everybody would be doomed. It's all of what we would make of it. Now I would say almost all the millennials would be doomed. Those of us who were raised during tough times didn't forget how to survive on our own and can do it again if we had too.

 

[Industrial Toys]

If you mean the sky, are you talking that big plastic bubble? Like the one that lies shattered and broken on the surface of our moon?:cloud9:

I live in the boonies yet almost all my food and other needed supply ALL come from very far away. A trap that few would escape.