Dealer become a dealer

[mikegamb]

i was wondering if anyone knows how to go about becoming a dealer. Also I was reading about the 12th month dealer term for a min of 10 tractors ordered. I don't really understand it.Can't I just by as I sell?

 

[SHIFTY]

i was wondering if anyone knows how to go about becoming a dealer. Also I was reading about the 12th month dealer term for a min of 10 tractors ordered. I don't really understand it.Can't I just by as I sell?

To be a dealer they want you to be as commited to them as they are to you. Most Mfg's require 5-7 machines on the lot at all times, a couple grand of Spare Parts in stock and a repair faciality. Most require a line of credit of between 150-350k. I dont know of any lines that allow you to buy as you sell. Good luck

 

[mikegamb]

I understand that but i just don't see selling 10 tractors in my first year. I sell EZ dumpers and boxer skid steers.Right now I sell maybe 4 boxers per year and about 8 to 12 EZ dumpers.I just don't want to get too over my head and be stuck with 5 or 6 tractors from the past year

 

[Maka]

Welcome Mike. No, you can't just buy as you sell. They want a commitment to the product line and a serious person who will be around for the long term. You have some thinking to do as on this. If you don't have inventory people won't take you serious. Along with tractor inventory you need implements and parts. This takes a lot more than setting a couple of tractors on a lot and believing people will just buy them.

It is a serious undertaking that requires a strong desire and financial commitment.

Good luck,
Maka

 

[jc7622]

I was at a local city council meeting recently where some business owners who were in an unincorporated area were protesting being annexed into the city limits. They were not wanting to give up their advantage of not having to charge their customers city sales tax.

Anyway, the local Mahindra dealer spoke and said that he net profit margin was something like 3% of his gross sales. Of course we don't know what he is paying himself before net of if he is even telling the truth, but it seemed like pretty tight margins to me. It makes selling tractors seem not so easy.

JC

 

[shvl73]

3% net profit is fairly common in the building material industry as well. Of course that is net so, it is hard to say what salaries are being paid. You do make financial decisions very carefully though.

 

[montanaman]

Well there are better ways to make more profit, that's for sure. You really have to love this to do it and be willing to take some risk. There are a lot of expenses that the customer doesn't think about that constantly chew away at potentian profit and you'll need to do at least a reasonable volume to see any gains. I hate to say it but if you can't see moving 10 units a year, I wouldn't bother. I sell Montana's, Stihl products, and Dixie Chopper zero turns and some months I have a loss with one product that a profit in another brand helps cover. I spend a lot of time at service schools and dealer meetings so that I know as much about my products as I can. The Montana tractor is a fantastic product and can compete very well in the market but there are always the folks that will not take the time to learn the advantages that Montana offers. I will not even engage a customer on the topic of price before I have time to talk with them about their specific needs and the time to go over the features and specs of the Montana. Those who take the time to really look at and drive the tractors will comment on the built quality and the features. I price my products fair but I do not sell on price because those that shop by price alone can always find cheaper and are usually sorry when they do!

I truely love the business and I love having the chance to talk to people about tractors or I would not be doing this! There are plenty of hectic days where I think the folks at Walmart handing out stickers have the best job in the world.

Ken

 

[gemini5362]

I have a question for the dealers that answered this post. I think that having a parts inventory should be mandatory for being a dealer. I do know however that my dealer does not do that. I have tried to buy parts from him before and he could not get them. I did my 50 hour service and I was pleasantly suprised to find that he did have the filters. This was the first parts for my tractor that he has been able to get for me. Does montana actually require you to have an inventory to be a dealer ?

 

[montanaman]

The VERY few times that I have needed non-service parts, I have had them in a few days at most. I stock service parts and a few other items but I do not have a ton of parts. I have not found this to be a problem and I can tell you for sure that any of the parts that I did need, would have not been in stock if I would have had $50,000 worth of parts!! You make the best educated guess at what you think you will need while trying not to buy things that you never will and you know what happens next! The first thing you need, you don't have.......

Keep in mind all of the times you need a car part. I have a belt making noise on my 06 Chevy and the huge dealership that I bought it from, had to order it. Many times I need car parts, it's the same thing. You can get filters and oil, etc there but some items, they need a day or two to get you a steering box or axle seals, etc.

I've had a few parts that I would borrow from a stock tractor so a guy wouldn't be down. Just yesterday, I had to borrow a deck drive belt from a brand new Dixie Chopper because a customer destroyed one and though I have a lot of belts here, I didn't have that one. He's a commercial user and needs the mower so I do what I have to so he can get to his work! I was here at 9:00 last night calling him to let him know it was done. I figure he can spend his money any where he wants so I'll earn it from him with great service!

As far as what they require, I've been with them a long time so I have no idea what they require now??

Ken

 

[MessickFarmEqu]

I have not found this to be a problem and I can tell you for sure that any of the parts that I did need, would have not been in stock if I would have had $50,000 worth of parts!!

Funny We stock $4,500,000 in parts and sometimes say the same thing.