The Groundsman

June 2012

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the Groundsman June 2012 FEATURE 31 A new generation of dealers? With amenity equipment dealers in the throes of a number of changes, what will be the impact on groundsmen? product to market can be affected much more quickly. Cutting out the middle man and selling direct saves a lot. However, how do they cover all of the country? Simple, they don't. Instead they are forced to concentrate on the big spenders; package deals and the like. If you're stuck out on a limb then they'll come and see you, but don't expect a rapid visit. Then what happens when something goes wrong? Under warranty, no problem, but out of it and you're at the mercy of 'a man in a van' – sorry, their service team. Most probably not local, but no more than two/three hours away. Gone are the days when most of the country was covered with dealers stocking a wide range of equipment for the amenity sector - dealers that could be relied on to know what was available on the market and to give good advice. Dealers with good after-sales service because your order mattered; in fact, you mattered even if you only bought a strimmer, because next time it could be a tractor. I could be talking about the 1950s, but that sort of dealer was available less than 10 years ago. But all that has changed now - driven partly by the consumer saying he wants 'value for money', but more likely because he wants things cheaper. But with 'cheapness' comes a reduction in service. If the consumer doesn't value service and therefore isn't prepared to pay for it, then the situation is inevitable. For the manufacturer, under pressure to reduce costs, the first port of call is 'cost of sale'. Reducing manufacturing costs requires a lot more in-depth work, but reducing the cost to get the Then there's another approach; dealers merging or buying each other out. This reduces the number of dealers (and by doing so the manufacturers can reduce their overheads). If they then concentrate on selling only one manufacturer's products they, in turn, can save on overheads and make more margins. Then, by concentrating on the big spenders, they can reduce staff considerably and reduce their overheads further. This brings us back again to how do they cover all of the country? With the same answer, they don't. With dealers polarised, their level of service reduces and they get more out of tune with the market's needs. So what, some people might say. Larger dealers offer simplicity; one point of contact; chance to do deals on packages, etc. But are those things worth the price of diminished choice where the major suppliers can decide what is in their range regardless of what might suit you better? Diminished choice leads to a monopoly and dealers left only selling 'one colour' products. This restricts them from offering any sort of similar products from another manufacturer – products that could perform better or cost less. When budgets become more fluid and with reduced outlets for you to go to, what's to stop the selling price becoming fixed? The ability, in the long run, to be sure you're getting 'value for money' – sorry, the best price - is also diminished and almost leads to a cartel. No bargaining power there then. That is the 'bad' part. But this situation could lead to some 'good'. Good in that a gap is being created in the market and gaps have a habit of being filled. The man in a van could become the first point of contact for the smaller players. Those clubs that are not big spenders but nevertheless need repairs carried out. Especially if the club has bought some secondhand piece of kit from eBay, as we hear one major is using to shift part exchanges! So, when the man in the van is called out there's nothing to stop him offering advice on pieces of kit – and selling them. The birth of the next generation of dealers perhaps? Contributed by Tim Merrell, Managing Director, the Grass Group www.thegrassgroup.com Drought Updates To stay up to date with the latest news on the drought situation, visit www.iog.org

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