Dealers..past and future???

[Dagger]

I am kind of a new member around here, but unless I am misreading many posts here, it looks like an awful lot of the contributors in this forum are retail dealers in the chain saw biz..
Let me sum up a many years of observations about the chain saw market in the USA, and make a few assumptions..(gulp).. on the future... I believe I am percieving alot of diverse experience here, and would like to hear what you dealers think. Tell me if I am remembering it wrong!

Not so many years ago the market leaders in this Biz were McCulloch and Homelite.
Why?
Looking back I believe it was because their products represented the cutting edge of engineering devolpment in chainsaws for the era. Good equipment..good marketing/advertising..and good support, the right combination of all.

BUT...where did their LOYALTY lie?..with the factory employees..thats where. It is a pretty good bet that the concerns of a manufacturering pres..board..or owner, or whatever, were, and still are, with HIS employees! The Guys and Gals in the office all the way down to the people on the floor of the plant, and to keep them working..keep the bottom line up, and not have to lay em off because of slow sales.
In traveling for many years between the top end of distribution..to the bottom..the retailers, I have come to the conclusion that the retailers mistakenly believe that they , as independant owners of their own stores, kind of think that they are the ones that the management SHOULD be concerned with, but this is simply not the case.
The Management at Manufacturers are concerned with shipping products..increasing their volume, and increasing the size of their facility, because if you are not growing..you cannot maintain..you cant keep the employees working..just doesnt work!

Now..these market leaders are ALWAYS attracted to large volume retailers, cant be helped.
They place R&D resources in new products that attract the largest volume of sales/production. They MUST. Most dont care what kind of products they make..and I think that we will find that they care not weather it is the best product in any given market..just the highest volume, or highest profit..either way.

The manufacturers that are NOT concerned with being the highest volume..but with the fastest, or the longest lasting, or the lightest...will almost NEVER be the "Market leaders in Volume" but to get there...they must give all these impressions.
Pick a market..cars...shoes...saws maybe???

Anyway..back to Mac and Homelite. They , after becoming "Market leaders", quickly were accepted onto the shelves of the Mass-Merchants.
Becoming a "market Leader" first and gaining National Name recognition is a must because these retailers do not have the ability to "Sell" a product. By that I mean no one there has sales ability generally, and they only pick "presold" "products that have consumer name recognition, and gain market share by offering the lowest price.( or making the consumer believe they do)

ON top of the world right??? But what happened..??

As in ANY market, the consumers/ Users/ buyers of the products demanded the evolution of the products. competition between these 2 market leaders, and their NEW "big customers" demanded that the prices come down..and over time this continued trend must always result is lower quality.

Who in this world believes that the "best product" of any kind is the cheapest???

Now why are they gone??
Well, I personally dont believe that they are now extinct because their product evolved into poor quality. I believe that other factors came into play that had nothing to do with sales, but that is another subject, for another thread.

Where did the Independant retailers that stayed loyal to these marks go??
They went out of biz, or retired very poor... those dealers from that era that are still with us today are the ones that had the foresight to take on new different lines of quality equipment that did NOT have the National name recognition, (which comes from advertising) and using their "SALES ABILITY", converted their customers to another line. Slowly at 1st, Because some had to try a couple of different lines to find out where the acceptable quality was, and changing horses while still in the race has its problems for the dealer and his customers. They also used their service and support abilities to make sure their customers were happy with a product that had high quality..but less name recognition.. those that did these things survived. (Maybe they had a crystal Ball!)

Those dealers that continued to support the equipment that the chain stores sold..continued to support their own demise. Due to BLIND BRAND LOYALTY
Where are the Loyal McCulloch and Homelite Dealers now?


This cycle is continueing, only the names and places have changed.

Fill in the names and places yourself...where does the name of your dealership wont fit in the story?


Anybody think I am mistaken?

 

[WOLF_RIVER_MIKE]

let me think about it.

 

[Newfie]

I would have to agree with some of what dagger said. However, I think he has a vision of companies that existed 25 years ago when employees mattered. That simply isn't the case anymore. Anyone who has had experience with a company that has made the change from private to public will no what I mean. Once a shareholder becomes involved, that is all that drives the companies decisions. Business decisions are made (even if bad ones) if it will be perceived well by Wall street. These are the companies that begin farming out their parts to foriegn competitors and mass producing low end consumer throw-aways. Old style companies made a good product and built brand loyalty to insure steady business. Shareholders want to see annual growth of share value. Most of the time this is acheived by reducing costs by lowering quality and putting high paid US workers out of work. Doesn't matter what they make! It would seem that Husky and Stihl may be stretching their toes on the edge of this slippery slope. I guess time will tell. who knows what will happen to the dealers this time around?

 

[jokers]

That`s very interesting Dagger. So are you suggesting that dealers no longer service and support the brands and models, such as Echo and Husky, that the mass merchandisers are selling? At first glance it would appear that a savvy dealer could generate sales of more expensive and better equipment from contact with people who bought the giant retailer crap, and now need warranty service. I am not suggesting anything unethical, but the dealers need to band together within their local areas and commit to steering the lowend customers to the purchase of better equipment when they come in for repairs. I believe that many dealers actually have competent repair people on the staff who know the true difference between the models, but these same people lack the "people skills" to be able to sell better equipment to their customers without appearing to be boorish brutes or hucksters. Maybe dealers within a given area should consider getting together to share their resources, and educate and polish their sales staffs. Sales people need to be looked at more critically when being selected instead of just hiring their son Cooter. A smart dealer can actually capitalize on the company`s loose morals in retailer selection by offering first rate service, at all levels. Many people who would buy the cheap saws from Home Depot, Walmart, Sears, etc. undersatnd their own lack of knowledge and expertise and would probably be willing to pay a few bucks more than the lowest out the door price if they "felt" like they were being taken care of. Dealers need to work on their reputations rather than just having saws available. Also they need to think about what kind of atmosphere they create for customers, We constitute a rough bunch here, and not much is taboo, but we need to consider how we would feel walking into a shop full of guys having one one of those "yuck yuck" sessions if you weren`t there when it started. You could very realistically feel like some of the joking is at your expense. Now consider how your wife/mom/daughter/girlfriend is going to feel walking into that scene. We as consumers probably don`t perceive the sales people at Home Depot or Sears as professionals, but they are required by their employers to demonstrate characteristics of professionalism such as making the customer feel welcome and at ease in a non-threatening environment. In many cases their lack of product knowledge can be overcome by the subtleness of the soft sell in a non-threatening environment. That probably means an innocuous retail setting, but if we are going after the homeowner sales, no matter how full of bravado many of them seam, virtually all of them feel like they know very little. No one willingly wants to be made to feel like a fool or novice. I think many dealers need to start thinking in terms of what can "I" do to improve my operation, rather than counting on the parent company to provide all the answers. Kind of the same mentality you have to keep when dealing with a realtor, you have to remember who they really work for, themselves. Not the buyer, or even the seller. Russ

 

[Dagger]

Newfie..yes, you are right about companies 25 years ago..etc...but I must qualify that my vision of AMERICAN PUBLICLY HELD companies is what you are describing. And that begins the thread on why and how McCulloch and Homelite met their demise..another subject.
But, may I remind you that neither of the names you mentioned are American publicly held, and there stock cannot be found on Wall Street. There is a difference here. One company you name has been in exsistance for over 300 years, and has more expierience manufacturing pots and pans,,guns,,motorcycles, heating stoves,bicycles...and a myriad of other things other than chain saws. they have changed their main product lines many times over 300 years..to suit the larger market. They also have no concept of the difference between a "chain store" and a small dealer...there are only big retailers and small retailers and overall market share. You would have to grow up in a socialist country where no mass merchants exsist I guess to realise that they know no difference.
Also there are generations of families that have worked for that company, and many in upper management today, do not know how far back to go to find a time when their fathers, grandfathers, mothers, grandmothers did NOT work for the same employer. Literally a dozen generations!!!
I assure you, the attitude there is for their own! I guess that is one of the differences im trying to get across.

Jokers...certainly ...here are a few examples of what happens..
When the brand that the Independant dealer has established in his area successfully goes to the mass merchant, then the Dealer usually stops advertising, because he knows he cannot "out advertise" the big guy...or he says, why would I invest anymore money in advertising when it will just promote the customer to go out there and buy a saw on sunday. either way..his lack of advertising continues to cause a decline in his sales. That coupled with what ever penalties he gets from the Brand for lower volume( lower margins..lower labor rates..) means simply less profit for him. Inevetably he loses his "excitement" over the products and becomes apathetic to sales in general over this brand..maybe even this whole market (all chainsaws)..All because he didnt get out when the gettin was good..meaning when he still had chainsaw customers coming in his door. Whatever brand they were looking for. He had the chance then to try and convert them to another good saw...and keep them HIS customer.
OR...he stays in long enuf to see the products get so cheap and low quality that everybody in his area hears about "that Piece a **** saw" that was bought out there at LOWEBALLWORLD , and he suffers from the same poor reputation that they are getting.

I used to be as loyal to a brand as anybody..I was full of pride in my favorite, but after awhile I realised that in todays world there are quite a few awfull good products in any market, and that BLIND brand loyalty kept me from appreciating many of them.

Funny how it happened too, I won a then newly introduced model 044 in a chainsaw race..and I figgered id just sell it, cause it wasnt the right color for me, then i used it one weekend, man!...Ill never sell it now only because when i look at it sitting there in the shed..it reminds me of an important lesson It taught me! Ever since then I havent ever traded cars/trucks for the same brand..and have alot of different color saws.


WRMIKE..thanks pard..you couldnt have made me feel any better or given me a better answer for starting this thread!

 

[sawracr]

Dagger, when a CEO of a company, whom has many butt-kissers under him, makes a mistake, it usually costs a firm dearly maybe even demise. Where are the loyal dealers now? selling Stihl or Husqvarna. a more important question should be, did the CEO of these firms get his golden parashute. DEALERS DON"T DESTROY COMPANYS!!!!!!!

 

[ricksvar]

Companys fail most often because of management,thats the CEO's and board members with sheepskins displayed on the wall as impressive monuments of their educated minds...and their little butt-kissers......they usually get it in the end

 

[Dagger]

Here are some more distinguishing facts to ponder on..

Ownership...
It might be said that where the ownership of a company is where the different philosophies begin. Hence the different polocies and attitudes .

Husqvarna. = Electrolux, multi national company generally owned by the government of Sweden and governed by a Board of Directors. It is a unique arangement, unlike any other.
As in most socialist/nationalist governed countries such as sweden the government owns about everything..however in Sweden it is a combination of Government held and Individual industrialists that actually own the company..But control is definatly by the Board of directors, elected not by the common stockholders..for there are not any..but by the members of the board..they decide who gets in and who does not. Only stockholders are boardmembers/government officials.


Stihl = Privately held....Peter Andreas and family

Solo= Privately held.. Emmerich brothers, sons of the founder

Dolmar= public company...Makita International.Board of directors responsible to stockholders( they claim)

Echo= Kioritz corp/sampo ..public held..board of directors. stock available on the helsinki exchange

Just a short list here..but you might get the Idea..based on ownership the policies can almost be divided into 2 groups...
If you didnt know the above info..you could still tell by the policies.

 

[Newfie]

Dagger,
Don't take this as personal thing,Maybe I'm the only one, but I am at a loss as to what the point of your thread is. What would you suggest the small dealers do?

I don't think anybody subscribes to total blind brand loyalty anymore, but don't you think that a small dealer who has his interests at heart, best serves those interests by satisfying his customers with a line of quality products?

Was there a point to all this or was this practice for a economics lecture?

I'm college edumacated and I understand the theories you put forth, but none of them seem to relate to the future of the small dealer. Regardless of ownership model, maybe the simple answer is they are all greedy bastards and that's why they make decisions as they have?

 

[seesaw]

Newfie,
Dagger's thread makes perfect sense to me. I think he's showing a very distinct pattern of large, publicly held companies who are beholden to the shareholders, that have gone into the mass merchants. The pattern suggests to me that they (the large companies/manufacturers) who go head long into the box stores in order to serve the shareholders and increase bottom line, end up leaving the dealer holding the bag.
They pump the dealer full of fluffy rhetoric concerning how the move to the box stores will be beneficial to the dealers. Then, they leave the dealer behind, representing and servicing their product as they watch both their sales and product quality go down the tubes. Result: you represent a company's product you can't sell because you can't match prices and the quality of the products you do carry get so poor that no one wants one anymore (McCulloch for example).
I think also, Dagger is trying to gentley convey is that we need to take a closer look at privately held manufacturers((Efco, Solo,...). They have some exceptional options and should be explored by the dealer in order to plan for the foreseeable future. Can you fellas see the pattern here? McCulloch...Homelite.............Husky??????
I can't believe a manufactuer has the stones to demand such a high quoata or threaten to cut discounts, tell you you need to be a "Total Source" dealer (like they know whats good for YOUR business)and still have the nerve to tell you that gong into the box stores will help your bottom line! Kinda like telling you , you are going to be forcibly raped and at the same time....tell you how much you have to like it and that it will be beneficial to you!!!

 

[Dagger]

Newfie, no sweat bro, as far as the personal thing goes...

Seesaw has got it jus right...

as far as my point...WF mike got it, he is thinking about his dealership, and where it fits in, and where it is going.
Mission accomplished.
In fact, I think all the dealers who read this will get it,if they have been in this biz more than a year or 2, and the consumers wont have any idea what we are talking about probably, but as the title suggested..this thought is for Dealers.

I have Independant Dealers to thank for the good living I have made for over 20 years, God Bless you all. I guess I feel kinda bad for a independant when I see him gettin screwed. The consumers/buyers cant see whats behind this Newfie, If you are not a Independant servicing dealer, dont bother with this thread.
Nuttin personal!

This thought might help ya understand tho Newfie... what would you do with the gal that YOU took to the Dance, when she decided to dance with someone else??

 

[Newfie]

dagger & (seesaw),

Right, I got that part about corporate indifference (read my first post in this thread) toward anyone except shareholders & the board. And I think this is where I fell of the thread train, dagger you bring in the factor of Electrolux ownership being the govt. of Sweden (which I had forgotten about). Are you likening their situation to a corporate one like here in the US as opposed to the private ownership of the other saw lines?
I suppose switching to the other lines of saw might be a short term fix, but I can't believe that one or all of these companies is not going to pull a McCulloch (daggers other post on rosshuber's thread) and sell out to someone with a shareholder outlook, that's the way of the world economy these days it seems to me.
I think in any event whatever the sawline an independent dealer is going to have to work hard to make a comfortable living because of the tight margins involved. I'm not a dealer, but am good friends with one and no all of the BS he puts up with from any of the product lines. He's lucky enough to be watching home depot sell Huskies and Toro lawn equipment.
In the end I don't have an answer except that I can't see independents disappearing, because Husky is selling crap saws in a box chain, somebody has to meet the needs of people with demand for service and real saws.
An interesting thread in any event.

By the way, the girl I took to the dance, how big were her eyes??

 

[Keener]

O.K. how about my two cents worth as an every day saw user.
From what I have experienced up here in the frozen north I think dealer success could be guaranteed by focus on three things, SERVICE,SERVICE, and finally SERVICE, (apologies for shouting).
Over the last 19 years in this business I can count on the fingers of one hand the times I was completely happy with the job the dealer did on my saw.
I have tried 3 different dealers to no avail, I suspect they need to hire service people who feel what they do is important and not just a cheque every two weeks.
Whats the answer?, well how about selling a saw with twice yearly checkups, even if it's only to clean it up, sharpen it and deburr the bar, for 30 minutes work the owner thinks it cuts like brand new again. It also gets him in the store twice a year and guess what..... he usually buys something or sees something he tells his buddy about.
This service could be sold on the pro line saws encouraging the average Joe to step up a notch in his purchase which then makes the market you serve different than the big box stores.
Bottom line, I would love to find a local dealer/service rep who I was 100% confident in, I could just drop my saws off and know that they would do a better job on it than I would.

 

[Newfie]

Dagger, I give! (sorry for participating in what I thought was an interesting thread, even though I can't possibly understand, not being an independent dealer) It has been kind of eating at me for the last couple of hours what exactly it was you were trying to get at. Your posts were a lot of facts with veiled suggestions. Sooo... I went back and read your posts on the site and it is clear to me now. I discovered a common thread of anti-husqvarna rhetoric and pro-Solo rah-rah cheering. Be careful of getting too brand loyal to Solo, they could be next. Good Luck with the crusade and happy cutting.

keener hit the nail on the head, service matters for everything and that will be the saving grace of independent saw shops. I don't care what brand of saw a guy sells, I won't go back if he has the retard twins working on my saws.

 

[stihltech]

Service

I believe that service still sells the product. I work 3 nights a week till 8 PM, and that is when I do my Pro business. Alot of my refferrals come from these pros. Then, word of mouth generates 75% of the other sales. We tried selling more than 1 brand and it became a hassel. We decided to do a very good job servicing 1 brand. It has worked for 20 years now and sales tend to increase slightly each year. I do my share of box saws. The intelligent consumer may buy 1 or 2, but then it dawns on them that they do not last. Also the service begins to become important.
So far, so good. We will stick with it until something better comes along. I just hope Stihl doesn't take Husky's lead.

 

[Treeman14]

Service IS what matters most to me. I've been dealing with the same shop for about ten years, now.(Al's Lawn Care Products). They used to be a Husky dealer, so I used Husky's exclusively. About 2 years ago, they had some problems with Husky, so they switched to Stihl. Now I use Stihls and Huskys. The only other Husky dealer near me is an idiot. He doesn't return calls, he's overpriced, and it takes 2 weeks to get parts.
At Al's, I can walk in and most problems are fixed on the spot. He's had the same saw tech forever and I always get treated fairly.
I don't see a lot of difference in the saw brands, but the service makes all the difference in the world.

 

[tony marks]

u fellas are not current. didnt u know that stihl has gone with HD and walmart.think i read that somewhere where will it all end.
whers my axe

 

[Newfie]

Hey Tony,

I think if you go back and read that thread again you will discover that it was an April Fools Thread. No GT on your Stihl for an extra $10 and no Stihl in Walmart & Home Depot (at least not yet)

 

[Dagger]

3 cheers to all you fellas who hold good service above all else.

StihlTEch...read treemans post carefully...you are on the right track, but i would slightly change the sentence you made to
"Service sells the DEALERSHIP"
not the product...the dealership can sell whatever product he chooses..and if he does'nt serve the customer,.. well like treeman said!
Stihltech, do you think that if your place started selling something else besides Stihl, that all your pro-customers would leave you that day?? You sound like a pretty good wrench to me, reading your stuff, and I doubt that they would leave you . I think that they would all ask why of course, and when you said that I just cant make enough money to stay afloat sellin these things and I found this other brand that is just as good and I decided to try em. Now...dont you think that they would consider trying one a them "other " saws next time they needed a new saw and came in to see you??
(no intention here to say you cant make money selling stihl..just a hypothetical question...substitute any brand names you want)

on the other hand...your consumer customers..who are getting fewer and fewer to most all of the independants everyday..they would probably bail at the first sign there was better price .
They never seem to think of service untill AFTER they buy something. BUT, they are the LARGEST portion of the market!


Why do i think that might happen?? History repeats itself!
Ask any of your reps who call on you that have been in the biz for a long time if there are more..or less servicing dealers out there for them to call on in their territory!!!

From my viewpoint, the servicing independant is becoming a scarce place. and last week according to USA Today,,I believe it was a AP wIreline story...Wal-Mart became the Largest corperation , General motors was about 5th down the list!

 

[stihltech]

Service

Got to agree with ya on that one. The local Husky dealer seems more interested in mowers and tractors. I know we outsell them in saws 4 to 1. But I also here my pros complain about waiting for service. This is their income. I will always get a pro's saw done first, I have even explained that to a couple of consumers who thought they should come first.
Service will sell as long as not everyone is mechanically inclined. But a smart pro knows time is money and if he can bring the saw to my shop and get it back the next day, or quicker, I think I will be ok. I have many customers come from two cities about an hour away for my service. Yes I am proud of that.