Looking at Bad Boy Tractors, thoughts?

[deezler]

I understand your point but it is their business.

If they are successful/thriving it will support their model.

If business climate, competition, client base (etc) changes and affects the bottom line, changes in business practices may be in order

For sure, if they are thriving, then it's working great for them.

But we also see tractor dealers going under all the time, even when they have good brands, products and OE support. Far too often it is their own stubborn sales efforts, and personal grudges that lead to a lack of business. Then these same type of people complain and ***** about how so-and-so screwed them, you can't trust people anymore, society is crumbling, etc etc. Some business owners never want to look in the mirror and realize that their personal childish behavoir is what leads to their own demise.

 

[artf]

WoW! Just saw & read this whole thread that devolved into Dealer bashing.

There would appear to be a general, complete lack of understanding of the Dealer Business Model, particularly in understanding profitability and business impact from Unit Sales, Implement/Accessory Sales, Parts, and Services Delivery.

Each of these are completely different with different goals, rates, margins and management. Sales, Parts and Service have to each work well.

Nobody wants to say it, so I will.

Dealers LOSE money on warranty work. The OEM warranty service rate is always lower than the Dealer hourly cost.

So the Dealer gets paid below cost by the OEM, uses up perishable service tech hours, and loses the profit opportunity on those hours.

On top of this, the Dealer has to pay labor to submit warranty claims and administer all the disputes with the OEM...... more unreimbursed labor.

The Dealer exists to
1. Make a Profit.
2. Sell Units, Implements & Accessories - Build Machine Population
3. Service Units
4. Sell Parts

If #1 Goal doesn't happen. The Dealership will no longer exist.

Most Dealers can't get enough units from their OEMs.

Dealer Profits are tied to Machine Population in their market area ( I did not say contract AOR), Parts Sales & Services Delivery. In some cases, project teams are bringing machines into the dealer's market area, requiring local parts & services.

Sales, Parts & Service to Commercial Customers is different.

 

[RickB]

Dealers of some brands that meet service certifications and other dealer standards receive substantial incentives that drastically change the profitability of warranty work by increasing parts margins and labor recovery. The investments of time and dollars required to meet these certifications and standards will in many but certainly not all cases contribute to better more efficient operation of non-warranty service and parts sales.

 

[BigBlue1]

WoW! Just saw & read this whole thread that devolved into Dealer bashing.

I don't view this thread as containing "dealer bashing". Just people calling out the fact that some dealers don't see the big picture. The stuff you list shows an example of that. Owning a dealership is a comprehensive thing that must take into account all the stuff you listed, which is the raw business economic stuff, as well as the bigger picture about how their behaviors and treatment of customers and potential future customers affects their business. Yes, warranty work may not be a profit center for them, but it is a cost of doing business that they must incur, at least in some fashion, because they have committed to being a dealer. If a dealer is only looking at each element as "how much am I making" and chooses to avoid some the less profitable pieces they may well be also avoiding a bunch of future business. Totally their decision to make, but folks here are pointing out the (lack of) wisdom of it. Everything in life has to be a balance and folks who focus too tightly on the raw money aspects in the short term may pay for it long term.

 

[ovrszd]

I don't view this thread as containing "dealer bashing". Just people calling out the fact that some dealers don't see the big picture. The stuff you list shows an example of that. Owning a dealership is a comprehensive thing that must take into account all the stuff you listed, which is the raw business economic stuff, as well as the bigger picture about how their behaviors and treatment of customers and potential future customers affects their business. Yes, warranty work may not be a profit center for them, but it is a cost of doing business that they must incur, at least in some fashion, because they have committed to being a dealer. If a dealer is only looking at each element as "how much am I making" and chooses to avoid some the less profitable pieces they may well be also avoiding a bunch of future business. Totally their decision to make, but folks here are pointing out the (lack of) wisdom of it. Everything in life has to be a balance and folks who focus too tightly on the raw money aspects in the short term may pay for it long term.

In the fine State of Missouri we have "Automobile Inspections" before you can buy or renew your license plate. Only authorized establishments can perform the inspections. They pay $15. They take 30 minutes to properly complete. The establishment loses money on every inspection.

The reason it is offered is to provide a service for customers and potential customers. And it is a gateway to possible repairs on the subject vehicle or future repairs on another vehicle because the vehicle owner appreciates the service provided by the establishment.

Warranty work falls in the same category. For most brands the "authorized dealer" is contracted to do warranty work. His brand sign out front is there because of that contract and is subject to losing it by not providing the service in the contract.

How the dealer decides to handle that is completely their choice. And it's completely my choice to direct my future needs based on that decision. Merica.

 

[orezok]

Many years ago in another century, I owners a transmission shop. We advertised fluid change at a cost that barely covered the fluid filter and gasket cost and no labor cost. By losing $$ on every service we generated a substantial amount of transmission rebuilds. When we showed the customer mud and metal particles in the pan, the deal was done.

You don’t have to make money on every sale to be profitable!

 

[Williy]

GOOD DAY Y"ALL The closet dealer is John
Deere a few years ago they had a sale
small John Deere tractor with trailer and
a grass cutter price $25,000+. The next
dealer is in San Angelo one salesman
told me some info and when I called again
different sales person and he said we don't
do that. Next is Lubbock K & S Tractor sales
Mike & Scott very helpful, if you have a question
they usually know the answer if not they will get
back to you with the information and they are
approx 130+ miles from me and I highly recommend
them and have purchase items from them after
purchasing my tractor. Just Wonderful people
to deal with

willy

 

[coobie]

WoW! Just saw & read this whole thread that devolved into Dealer bashing.

There would appear to be a general, complete lack of understanding of the Dealer Business Model, particularly in understanding profitability and business impact from Unit Sales, Implement/Accessory Sales, Parts, and Services Delivery.

Each of these are completely different with different goals, rates, margins and management. Sales, Parts and Service have to each work well.

Nobody wants to say it, so I will.

Dealers LOSE money on warranty work. The OEM warranty service rate is always lower than the Dealer hourly cost.

So the Dealer gets paid below cost by the OEM, uses up perishable service tech hours, and loses the profit opportunity on those hours.

On top of this, the Dealer has to pay labor to submit warranty claims and administer all the disputes with the OEM...... more unreimbursed labor.

The Dealer exists to
1. Make a Profit.
2. Sell Units, Implements & Accessories - Build Machine Population
3. Service Units
4. Sell Parts

If #1 Goal doesn't happen. The Dealership will no longer exist.

Most Dealers can't get enough units from their OEMs.

Dealer Profits are tied to Machine Population in their market area ( I did not say contract AOR), Parts Sales & Services Delivery. In some cases, project teams are bringing machines into the dealer's market area, requiring local parts & services.

Sales, Parts & Service to Commercial Customers is different.

To funny dealer bashing.Not really some dealers want to cut a fat hog in the A$$ just for profit other dealers want to truly take care of the customer before and after the sale & build life long customers which then grows there business.

 

[RSR]

Nobody wants to say it, so I will.

Dealers LOSE money on warranty work. The OEM warranty service rate is always lower than the Dealer hourly cost.

I don't doubt that what you're saying, while maybe not universally true, is the norm, rather than the exception. Nevertheless, you're missing the point.

If you have a problem with the way a manufacturer handles warranty claims, take it up with the manufacturer. Don't take it out on your customers. That's misdirected, poor decision-making.

If your tractor were to break down in the field, you wouldn't burn your crops in response because you have been put in a tough position.

Perhaps a better metaphor would be for me to say, as an educator, "I'm not happy with my superiors/administration, so I'm going to do a really poor job as an educator in the classroom."

 

[RickB]

I don't doubt that what you're saying, while maybe not universally true, is the norm, rather than the exception. Nevertheless, you're missing the point.

If you have a problem with the way a manufacturer handles warranty claims, take it up with the manufacturer. Don't take it out on your customers. That's misdirected, poor decision-making.

If your tractor were to break down in the field, you wouldn't burn your crops in response because you have been put in a tough position.

Perhaps a better metaphor would be for me to say, as an educator, "I'm not happy with my superiors/administration, so I'm going to do a really poor job as an educator in the classroom."

This and related issues are why you see dealers remain in place while the manufacturers they represent change. I ran the service department at a dealership where one brand accounted for about a quarter of the service volume and three quarters of our headaches. Nobody at the dealership was unhappy when the boss dropped that brand. It's not always the manufacturer that terminates the dealer.