Dealer has question for Commercial cutters about equipment purchasing..

Discussion in 'Lawn Mowing' started by tallimeca, Jul 11, 2006.

  1. tallimeca

    tallimeca LawnSite Bronze Member
    Posts: 1,229

    A couple posts I have read lately have led me to ask you guys some questions and get some feedback.

    I see guys saying.....oh, that is a bad price, it's almost retail.

    My question is, with the dealers you buy from , how do they advertise their equipment as far as price goes?

    Most manufacturers have a Suggested List, a Promo, or "Sale Price". Then there is a "Dealer has been sitting on this product and needs to move it price"

    Example. Exmark 36 Metro with 15hp Kai Kawi engine and ECS handles.

    Suggested List $2899.99

    Promo Price $2799.99

    We put everyone the sales floor at Promo Price and hold it there. It makes it easier rather than putting it at Suggest List, and playing the used car lot game, and I end up selling it for Promo anyway.

    Do you guys feel more comfortable walking in a paying a manufacturer's advertised sale price, or if you didn't know what it was, would you walk out the door feeling better that i was selling it for 2899.99, and you "got me down" to say 2829.99?

    Also, how much of a markup would you think dealers make on a piece of equipment. Let's use the above example. What percentage do you think a dealer makes on that unit?

    This is 100% serious question and something I often wonder.

    I must admit, that with more expensive units....Lazers, Navigators, depending on the customer, I might sell the unit lower than even promo, where I might make a higher dollar profit, but not a higher percentage.

    I have customers that will come in that i've never dealt with before.....and want me to sell them a 2800 dollar walk behind and throw in a 300 dollar bag for nothing.

    Factoring in freight it cost the unit to get there, labor of uncrating and assembling the unit, time of selling and doing paperwork if financing, the 1-2 percent charge if using a credit card or finance program ( $50 on an average walk behind sale) and instructing customer.....this unit just cost me money to sell.

    In comparison, it's like you guys charging a customer $60 dollars, to go pick up 2 yards of Mulch that cost you 26 dollars a yard, delivering it to their house, and spreading it for nothing. Yeah, you gained a customer who might sign a maintanence contract with you or call you back for other work, but it's not guaranteed and it just cost you money. I have guys bring me equipment they bought brand new somewhere else to save money, but their service dept is slower or more expensive.

    Let me know how you feel.
     
  2. topsites

    topsites LawnSite Fanatic
    Posts: 21,654

    Sir, I really don't give a rat as to how much my mower costs or how much the dealer makes because that is not my problem. For this I need a dealer I can trust, because I know I don't care for it when one of my customers puts me through the 'omg it's too high' nonsense so I spare my dealer this bs as well. As for list and retail and msrp, you're better off quoting me the price straight, I'll pay whatever you say it costs, no games, just the price.

    What gets me is parts... For example:
    The rubber grommets on the side of the T-bar first cost over a dollar each at the dealer, and I break one of these at least weekly and it's something I am anal about and I HATE having to drive by the store every single time I need several more, I like having about 40 or 50 of them. But everytime I walk in they never understand why anybody would want more than 2-3 of these grommets and I went through this time and again until one day I had enough.
    There are many more parts are not just over-priced for one, but every time I need it, they have to order it and then it's 2-3 weeks before it comes in and sometimes they get it wrong and OMG it's just a good thing I have a spare mower because one thing's for sure: I stock up on parts anymore and I can and will go through the trouble of finding suppliers that sell what I need, whether it has the Toro stamp on it, or not.

    Now I order my grommets from a rubber supply company, they send me 100 at a time and the cost is 43 dollars shipping included, so 43 cents each and I have my 4+ year supply. BLAM, no more running by the dealer, and anytime one breaks, I got another one ready to replace it (and yes, I carry several in the truck).

    So there you have it, you can charge what you want for the mower but the bs with the parts, I will not stand for it.
     
  3. dvmcmrhp52

    dvmcmrhp52 LawnSite Platinum Member
    from Pa.
    Posts: 4,205

    2899 list, your willing to sell at 2799?
    I'm not buying.

    Dealers with larger volume get better pricing.
     
  4. Freddy_Kruger

    Freddy_Kruger LawnSite Bronze Member
    Posts: 1,064

    Thats exactly what I wish I do with equipment, buy directly from the manufacturer.
    I'll be buying a Billy Goat lawn vac and a 9-10 HP blower this fall (maybe two of which ever one works the best) and the best I can do now is shop around by phone asking dealers for prices.
    BUT! there is no dealer for Daniels Pull Back Plow so I phoned the guy up in chicago and they will ship it to me but I have to pay shipping. The only thing I ever odered online was a Dell axim v51 and it was shipped from texas but I'm not sure how much 300lbs plow will cost but I would do this with all mowers and such equipment. I hate negotiating and I'm very aware of the "OMG thats a lot of money" thing you mentioned. BUT OMG I paid a lot for my raker and powerbroom:rolleyes:
    THey already hit me with the "YOUR price is..." bs as if they are already giving me a great deal but I found some other dealer over the phone selling me same thing for a couple hundred less. LIke 15% less.
    Exact same thing with oil filters for me it was $19 bucks at the dealer and $4.5 at canadian tire. Plus, in the dealer you can wait for a very uncomfortable 1/2 hour till you get served.
     
  5. lawnmaniac883

    lawnmaniac883 LawnSite Silver Member
    Posts: 2,613

    Im with topsites to a degree. Tell me what it costs and I will pay it. There is no cense at all in driving 50+ miles to the next dealer to save 5 bucks. I will not haggle and play the used car game with my dealer. They need theirs too ya know? Everyone needs to make money and I understand that. That said, if my dealer EVER knowingly overprices a piece of equipment and sells it to me at the ridiculously high price, and I find out what it was really worth next week month or year, they will no longer be my dealer as I cannot stand being ripped off or taken.

    The dealer that I buy everything from has three prices on each piece of equipment. Suggested list, Sale price, and price on account. Yes, they are big enough to where you can open an account with them and order parts without needing to prepay, they will put it on the accnt, etc for a fee which is usually a percentage of the price of whatever they are selling. Nice program they have there.
     
  6. tallimeca

    tallimeca LawnSite Bronze Member
    Posts: 1,229

    The example is this.

    Manufactured suggested retail is 2899. Like MSRP on a vehicle. But this manufacturer is encouraging their dealers to sell it at the promo price, or sale price of 2799.

    Some dealers will price the machines higher in order for their salesman to "sell" the unit, and make more of a commision off it.

    Yes, larger volume dealers to recieve better pricing. This is true with just about anything.

    If you are buying mulch by the yard at the local nursery for 28 dollars a yard, or you have a lot where you can buy a truckload at 20 dollars a yard.

    Do you sell your mulch to your customer 8 bucks cheaper then everyone else, or put an extra 8 bucks per yard in your pocket. Depends on the company and what they want to do.
     
  7. Howie's Lawn Care

    Howie's Lawn Care LawnSite Senior Member
    Posts: 512

    My dealer sells hsutler and his prices are usually around 17% less than MSRP.
     
  8. tallimeca

    tallimeca LawnSite Bronze Member
    Posts: 1,229

    Great Point and partly the reason I asked the question. If i sell everything the same to everyone as on the sale for......Landscaper A pays what it's priced......Landscaper B pays what it's priced. All is well.

    If Landscaper A payed Sugg retail, and Landscaper B came in and paid promo.........they both start shooting the bull at lunch at the local sandwhich shop........

    Landscaper A will probably no longer be my customer.

    The reason why I asked about markup is because some customers come in and think the 200 dollar trimmer they just bought........I made 100 bucks on it. When in reality, i made 40 if i'm lucky.
     
  9. dcondon

    dcondon LawnSite Silver Member
    Posts: 2,246

    Give me your best price and I will buy it. I WILL not talk with a salesman and go back and forth on a price for anything., Service plays one of the most important parts of the business!!!! Yes I will check a few places and request there best price also.:)
     
  10. tallimeca

    tallimeca LawnSite Bronze Member
    Posts: 1,229

    Sorry for your troubles. My first question would be why the hell are some many of the grommets breaking? Poor design? Could you used a bronze or metal in it's place to last longer?

    I can underdtand your frustration, but understand the dealers too. If you are the only guy they deal with that uses 206 of these a week, it's hard for the dealer to stock because if you sell the machine or move, or go out of buiness, they aren't moving enough of them, beside you to keep them in stock and they will be stuck with them.

    If you were my customer, i would recommend you ordering them in LARGE quantities and i would have offered you a substantial discount, just so i didn't have to stock them.

    I have some customers who come in and ask for large quantities of the oddest parts that I never sell and get upset that I don't have them.......but the fact remains that most dealers carry the fastest moving parts and have computer systems to track what they sell. Their isn't anything you can't get overnight if you needed it bad enough. In your case, if you knew you go through them like you do, you did the best thing, by stocking up on them.

    As far as parts prices go, dealers don't make the prices on suggest retail of parts. Most dealers mark parts up above suggested retail because the margins are terrible. I sell both OEM , and aftermarket parts. I can tell you there is definetely a difference between aftermarket parts and OEM. Not all of them, but some of the filters and oil filters, there is a reason why they are so cheep. We took a 14hp Kawasaki FC420V motor, put a brand new OEM filter on it and cut half the lawn/weeds on the side of the building. Took the filter off and looked down in the throad of the intake. Took a brand new brand x filter and repeated the other half. The amount of dirt in the intake was AMAZING. I was even surprised.

    Some of the aftermarket oil filters are pisser too. You go to take it off the casing and filter comes off, but the base is still screwed to the engine. Be carefull what you buy!!! I can tell you we've had real good luck with the Oregon and Stens aftermarket stuff. Some of their stuff is better then OEM.

    Just like you, if the dealer doesn't make enough money to pay their bills, they won't be in buisness. Granted, some places are just robbing people blind in sure, like in any buisness. There's a local place here that is as expensive as they come. They have been in buisness for ever and are known to be rediculously overpriced, yet they have customers lined up at the door. I guess they are doing enough buisness to not notice the customers who abandoned ship. Must be nice to be making that kind of cash:dizzy:
     

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