Dealer Deere dealers closing down

[montanaman]

Well it looks like two Deere dealers very close to me have been told they are no longer wanted as dealers. The closest one to me I know pretty well and he has built his life around trying to sell and service the green and yellow. He has never had anything in his place that wasn't JD or Frontier.

The story goes that they no longer want the small dealers and want to sell through dealers that can do about 5 million a year.

The sad thing is that if I needed a part for a JD, I know that my local small dealer could get it for me. The giant stores don't tend to have the "quality" of people working there and the parts dept is usually staffed by the guy or gal who will work for the least. His place was just like mine, family rum and you couldn't find a person working there that didn't care about the customer!

I know I've lost a few sales to these dealers because of the power of JD and customers that are afraid of future service but it looks like I'll be the one still here.

I'll likely pick up some JD lawn and garden service work too I guess.

I'm just glad I have Stihl here. They have advertised for too long that they aren't in the box stores to ever take that turn!

Ken

 

[gamble77]

That will be Deere's tendancy for years to come. Weed out the small dealers and try to thrive on large multi-store dealerships. Sounds like good news for you though!

 

[CMunger]

It is not only Deere that is doing this, Agco is doing it by moving in with Cat dealers with the Challenger line, and CNH is going for the larger dealer route also. These concepts would be interesting to debate. Some car manufactures have done the same thing, they annalize what the average profit is on a auto sale, and determine how many cars a dealer needs to sell, then calculates the sale potential of the territory, then gives them a area large enough to sell a given nimber. The "Mom & Pop" thing, like the corner store vs Wal-Mart.

Chuck

 

[montanaman]

I know what they are trying to do, but the problem is that they are creating huge gaps between the dealers. Most customers will ask me where the nearest Montana dealer is from me and some don't like the answer. There have been a ton of JD lawn tractors sold by these two dealers because they were close to the customers that bought them. When JD put their stuff in the junk stores, that hurt these dealers that have been very loyal to sell only JD. Oh, but they did get to pick up a lot of under-paying warranty work for JD though! Now after JD beat them out of sales, they come back and pull their dealerships because of lack of volume??

The problem with the mass merchants is that they DO cause the quality of products to go down by creating bidding wars between companies trying to get their valuable shelf space.

I've been to the local Home Depot and Lowes and it's a fact that I sell better chainsaws at the same prices, and sometimes lower! Home Depot is selling saw chain made in China for higher prices than I sell genuine Stihl chain made by Stihl in their own plant! Stihl is the ONLY saw company making their own chain and there are a half a dozen reasons why it IS better and yet Home Depot is as high as $4 more than me on a 20" chain made in China!

When I built a deck last year, I went to my local lumber yard and guess what? They had straighter, nicer lumber than the junk stores and they even stocked boards over 16'. The prices were much better too.

There are some things that it's hard to beat the box stores at but there are a lot of items that people flock to them to buy that they could get better quality for less by shopping their local businesses.

I think they advertise so much about their good prices that people just blindly believe it!!

Enough rant for now...

Ken

 

[LBrown59]

Well it looks like two Deere dealers very close to me have been told they are no longer wanted as dealers.
Ken

Did you read the John Deere dealer out to lunch thread?

 

[Mahindra35]

Mahindra Dealers are doing the same thing.

The small home town dealers for any kind of product are diminishing.

The global market will drive these conditions.

And home town politicians are gone.

Dont care to look at the landscape in another 20 years.

 

[Alan L.]

Fewer dealers = less competition = higher prices

 

[gamble77]

Alan L. hit the nail on the head

 

[CMunger]

The "Up & Comers" will take this mid position in the market place, mainly the Korean tractors. So, for you people that want a good product and neiborly service, at a good price.

Chuck

 

[Maka]

I agree with you Chuck.

Maka

 

[Chipperman]

The "Up & Comers" will take this mid position in the market place, mainly the Korean tractors. So, for you people that want a good product and neiborly service, at a good price.

Chuck

Chuck, I agree as well. It may be one day and one tractor at a time but the Korean tractors will continue to take market share from the big three or four.
Happy Tractoring
Chipperman

 

[lapietra]

LOYALTY.
Many people don't know there is a John Deere Dealer in Brooklyn, New York,
It's not your typical Deere dealer and has been loyal to the brand for 25 years.
This past christmas December the 23rd the dealer got its anual visit for yet another new territory manager (ty34 region 4) and was told they have 90 days left to represent Deeere in NYC. After its closing all of the dealers customers for the past 25 years will have to travel approx 40 miles in every direction for sales parts service and warranty.
HOW WOULD YOU FEEL?
Farm Equipment - Dealer Purity and John Deere

 

[Stampeder]

A previous boss of mine told me that when a business starts being run by an accountant or a lawyer, then when the last person leaves remember to turn out the lights.

He was so right. The company had been in business for over 100 years. The last two CEO's were a lawyer and an accountant. Then the business ceased to exist.

John Deere isn't run by people that know anything about farming. They have forgotten what the business is all about. Also, they are now entering the commodity business. In the commodity business the sale always goes to the lowest bidder. John Deere isn't in the tractor business anymore, they're in the lawn mower rebranding business......hmmm does this sound familiar.....does the name Montana remind you of something.

Privately owned businesses like Ford can compete because they don't have to pander to those Wall Street lugs and make profit on a quarterly basis. The exec's at John Deere are doing just that but focusing on the large customers and large dealers. I worked for several years at Hewlett-Packard, back when Bill and Dave ran the show. They always said it was better (and more profitable) to make many small sales that chase after the big sales. The big sales want to cut your margin to the bone. When Carly took over however she had no idea what made HP so great. She all but ruined the company before they threw her out.

John Deere will go the way of Montana. It will take a little time as they are much bigger. The only hope for John Deere is if they get someone like the head of IBM who took over back in the late 80's or 90's. IBM had divested itself of almost all it's divisions, and slid downhill. He took over and brought IBM back to it's roots. He said IBM was great because it offered the total computing package to it's customers with IBM's name on everything. This he did and look at them now. The same goes for Disney before Michael Isner took over. They had lost sight of what made Disney great. He took them back to their roots of making cartoons, although at first the lost money making them, he said it was important as that was what made Disney great. He was so right. Look at them now.

John Deere needs to learn it's lesson. Unfortunately it's going to hurt a lot of people for John Deere's executives to learn their lesson. It's going to be very expensive too. I also wonder how much money John Deere spends of research and development of products rather than rebranding someone else's?

John Deere like America needs to get back to actually building things. America is great when it does what it does best. Design, build and market products.

My two cents.
Glenn

 

[Taylortractornut]

The big local dealer sold a friend of mine a larger Deere a few years ago. Within a few days of purchase the tractor broke bearing in the front axle. The service man was a younger guy that seemed to have Autozone syndrome as he was helpless without a part number or tractor serial. He didnt have a clue. They sent the bearing 4 times trying to get him the heat the bearing and chill the shaft to make a .015 clearance. I told my friend theres no way that a bearing would take that. We pulled the other sidedown and the bearing fit seams some one in the Dana Wuxi plant in china put wrong parts in the axle assembles and the axles didnt match. They had to return the tractor as te big dealer wouldnt tear down another tractor to take a look. The big dealer told us that the tractor had been miss used in 4 days to the extent that it was owner fault. We talked to another dealer a smaller guy that was a deere dealer and he tore the same model tractors front end down and proved our tractors had an odd front end in it. He actually did the warranty work that the big store wouldnt do. He had to go through a lot to do this.