Dealers Have Three Years Left

It’s hard to believe that it has been 10 years since we ushered in a brand new millennium. I remember that New Year’s Eve back in 1999 very well. My band was performing at a resort in northern Wisconsin. Everyone was wondering if the world was going to end when the clock struck midnight.

Well it didn’t, so now I have the opportunity to look back at our January 2000 issue to reminisce upon what was happening in the power equipment business then—and how it compares to now.

The theme of that January 2000 issue was “Dealer Crossroads.” The increasingly high cost of doing business, tightening wholegoods margins and relentless demands of the commercial market were putting a lot of pressure on the average dealer. As a result, dealer attrition accelerated.

Yard & Garden predicted that the number of dealerships would be reduced to somewhere between 12,000 and 15,000 by the year 2010. That has certainly happened; our data puts the number of dealerships just a few hundred shy of 15,000.

There was a second prediction made in that January 2000 issue of Yard & Garden: When the dust has finally settled, the number of dealerships will have been reduced to a level around 8,000.

After some growth years in the 2002-2004 timeframe, the recent economic crash has kicked up quite a bit more dust. Dealer attrition has picked up again, but not at the alarming rate some had feared; at least that’s what many distributors told me this past fall (2009). While that’s a good thing, dust clouds continue to circulate.

According to a research report from The Freedonia Group, demand for lawn and garden equipment is expected to increase modestly for the next few years. The keys to your personal growth will be 1) the ability to offer new product enhancements that encourage consumers to replace their existing equipment, 2) strong marketing efforts that make consumers aware of what you have to offer, 3) continued excellence in the way of parts and service.

Take a hard look at what’s in your showroom this spring. Are your suppliers giving you the products and support you need to pull consumers in? Are you doing everything you can to pull consumers in yourself?

If you can make it through these next few years, business is expected to boom again come 2013. Will you be one of the 8,000 dealers who are left standing when the dust finally settles? Will there be more than 8,000 of you? Who knows. I can tell you this: The 15,000 or so who’ve made it this far are a resilient bunch, so I’m not betting against you.

Then again, some believe that the world will end on December 21, 2012. So maybe there won’t be any of you (us) come 2013. Believe it? Well, just in case you do, allow me to offer the following checklist of things every power equipment dealer should do before that date:

  • Make as many dealer friends as possible – there is strength and wisdom in numbers
  • Attend the GIE+EXPO in Louisville so you maintain your "seat at the table"
  • Personally thank as many of your customers as possible for their business

Good luck these next few years—and hopefully many more well beyond 2012.