Market knowledge, responsive customer service guide Jordan to Rural Lifestyle Dealer’s 2009 Dealership of the Year Award.
The 30 years Terry Jordan spent fixing and selling cars prepared him for a difficult task he’d face one day: Getting a tractor dealership off the ground amid serious competition.
Jordan and four other trusted employees, including son Brian and daughter Brenda, have done just that, building Jordan Sales & Service — Rural Lifestyle Dealer’s 2009 Dealership of the Year — into a thriving operation that sells tractors and a variety of implements alongside used cars.
In 2008, in just its third year of operation, the dealership in Post Falls, Idaho, sold $2.8 million worth of tractors and implements — up by more than $1 million from ’07.
The business reported a market share of 25% in 2008, up from 12.9% in ’07 and 6.2% in ’06. Drawing on his knowledge of Idahoans and their love of hot rods, Terry Jordan uses an inexpensive, grass-roots approach to advertising to sell tractors. He also believes in picking quality shortliners, running a lean, efficient business and treating customer problems urgently.
“I think we’re the right product at the right time, and we’re the right brand at the right time,” Terry says.
“We look like we’ll be here tomorrow and we’ll take care of customers.”
“It looks like a dealership and it acts like a dealership,” adds Jack Woodford, a former Kubota dealer and tractor industry veteran that Jordan recruited two years ago to work at his business.
“You go to some of our smaller competitors and there are one or two people, or there’s a dirt lot, or it’s a Quonset hut. Jordan is an honest-to-goodness dealership. People want this. They want confidence in the retailer they’re doing business with.”
A Growing Market
Farmers in eastern Washington and Idaho have long been known for producing potatoes, wheat, cattle and dairy products.
Jordan Sales & Service
Location: Post Falls, Idaho
Lines: TYM Tractors, Rankin, Rollins, Wallenstein, W.R. Long, M.K. Martin, Texas Bragg Employees: 5 2008 Revenue: $2.89 million ($2.81 million whole-goods, $70,000 parts, $16,000 service)
2008 Market Share: 25%
Key Staff: Terry Jordan, owner; Jack Woodford, tractor/implement division manager; Brian Jordan, general manager; Brenda Evans, office and receivables manager; Sam Mann, service technician
But as the farms have shuttered or consolidated, new people are moving to the region for its arid climate, relatively inexpensive land and wealth of outdoor activities.
Coeur D’Alene and Post Falls, Idaho, two small cities just a 30-minute drive east from Spokane, Wash., have seen major growth as farmland has been split and developed into housing. That means there’s grass to be mowed and land to be maintained, a perfect opportunity for an equipment dealership.
While there’s still a market for farm customers, the majority of Jordan Sales’ market is 5-to 10-acre property owners, many of whom are retired police officers or workers connected to the computer or timber industries.
Whether it’s maintaining elaborate properties or clearing access roads that lead to homes deep in the woods, these landowners need the right equipment to do the job.
“The Northwest is a great place to live. We have all four seasons, beautiful surroundings and a lot of open space. It’s what a lot of people are looking for,” says Jordan.
Jordan got this start in retailing by working in the automobile industry. He ran an auto detail and service shop but sold it and went to work for one of his accounts, a Mazda car dealership in Post Falls. He bought part of that dealership in 1986, but sold out in through Post Falls when Jordan’s 1998 and opted for wholesaling muscle cars on his own. Two years later, he went back to retailing cars and dabbled in real estate.
In 2006, fate came calling. A TYM factory representative that lived in Spokane happened to be driving through Post Falls when Jordan’s neat-and-clean car dealership caught his eye. Terry says the rep, Al Daubel, asked him if he wanted to sell tractors. Jordan asked how many tractors he could expect to sell each year. The answer was 15 — a number that didn’t thrill Jordan very much.
After researching the company and visiting another dealership, Jordan had to think about his approach in the market so he could meet his sales ambitions. “The dealers selling 15-20 tractors a year were not thinking like I did. I liked where TYM was, and when I found out where they were going, I was excited.”
Getting Off the Ground
The Jordan family had enough cash to get started because their car dealership already had buildings, tools, trailers, trucks and computers. The big challenge was getting the word out that a well-known car dealership was going to sell tractors — and convincing customers that a relatively unknown brand could hold its own against Kubota, Deere and New Holland.
Having sold Mazda vehicles against Toyota and Honda, Jordan wasn’t intimidated by the competition, but he understood that awareness was an issue. “We had to present ourselves better, show them what we could do and how we could do it, and let them make the decision,” Jordan says of his earlier car-selling days. So he soaked up any information he could on the competition.
During his first year with TYM, he took a John Deere tractor with a backhoe in on trade that the owner said was too small for his needs. Jordan took a small hit on the trade-in, but then went to work studying its strengths and weaknesses. He’s done the same thing with other tractors that customers traded in.
“If anything, it helped us rather than hurt us, and when we got tired of looking at them we dropped the price and sold them,” Jordan says. “When you have two competitors side by side, the value of your presentation means more.”
In the dealership’s first year, Jordan sold about three-dozen TYM tractors — well above the factory rep’s expectations. But Jordan got a big break in 2007 when Woodford moved back to Idaho from California and stopped by Jordan’s dealership one day. Jordan eventually talked Woodford into coming to work for him.
Woodford’s experience with the tractor market at the dealership level helped Jordan avoid making critical mistakes with its inventory and sales advice to customers. His buy-in with TYM was crucial because he doesn’t sell products he doesn’t believe in.
• Know what makes your customers tick and advertise in those interest areas, even if they’re non-tradition al for selling tractors
• Creativity in accepting trades — boats, campers and motorcycles — opens the door to deals
• Enhance your presentation by displaying older, other-colored trade-in units next to your newest mainline tractors
“Knowledge equals confidence. He gave us the added confidence we needed to sell the right product the right way,” Jordan says of Woodford.
Picking the Shortliners
A major task Jordan assigned to Woodford was picking shortliners to complement the tractors.
When it first opened, the dealership hit some bumps. Some box scrapers and blades Jordan picked out weren’t sturdy enough for the tractors and came back to the dealership for repairs.
“I was focused on price instead of quality. You have to have a balance between price and quality,” he says. Woodford knew from experience what to put on the let. The dealership chose Logan, Utah-based Ellis Equipment, which distributes Rollins, M.K. Martin and Wallenstein tractor attachments that Jordan sells. The dealership also picked up Rankin farm attachments, W.R. Long loader attachments and Texas Bragg trailers.
Those implements tend to be higher priced, but Jordan is pleased with the choices, especially since some of the manufacturers offered better incentives to keep his dealership as a customer. He also reports better warranty and service support from Ellis.
Since the dealership might only make $100 -$150 profit on the blades, wood chippers, loaders, mowers and scrapers that are sold, Woodford doesn’t want to see them come back for repairs
“Plus, the customer is happier when they don’t have to come back here with a problem,” Woodford says.
Jordan says customers will probably be better of going somewhere else if their only goal is to save a buck.
“We’re finding customers will pay $1,000 for mowers that they can buy for $800 in a box store because we have value and longevity. And they like the fact they only need to go to one place to get taken care of. They don’t have to go to three different places for a warranty.”
The high-quality strategy with implements, and the dealership’s emphasis on demonstrating them along with tractors, seems to be working. About 70% of the new tractors the dealership is delivering to customers come with implements, especially rear blades, mowers and box scrapers, Jordan says, adding that a vast majority of buyers come back within a year to purchase other implements.
If a customer is on a tight budget and decides to wait out an implement purchase, the dealership’s salespersons try to establish a solid relationship and show some patience.
Jordan recalled one customer who bought a tractor 6 months ago and returned in September to buy a trailer, rototiller and pallet forks. He chalked it up to maintaining relationships.
“They’ll come in to buy oil filters, or have a question about their tractor’s operation, and it’s an opportunity to sell them something.”
Branding the Tractors
Advertising decisions are important for any dealership, and even more so for a business spreading the word about a new brand in the market.
Jordan’s approach to advertising is a little unconventional. The dealership’s bread-and-butter strategy is placing full-page ads in magazines that sell hot rods, which are a favorite past time in the Spokane region. It’s a market segment that the Jordan family knows well, and they’ve capitalized on it.
“Many of our customers have a hot rod in their garage, they have a nice place, they love cars, and they pick those magazines up every week for entertainment, whether they’re buying cars or not,” Jordan says. “I’m in there with a full-page ad with tractors, and a side-by-side full page with hot rods. They’re seeing me consistently, and when they’re ready to come in they remember seeing my ad.”
Jordan’s goal is to build business through local relationships. Sometimes he puts a tractor on the lawn of a local bank or business he has working relationships with, or he displays a tractor at car auctions so his dealer friends can see them. Those approaches seem to get better results than random, broad advertisements that customers may or may not read.
“You can’t rely on the people driving past your dealership because that’s just a small part of your customer base,” Jordan says. “And you can’t rely on word-of-mouth because you’re new. You need to be out in the public eye consistently. The fastest way to get the word out is to get the product into the public’s hands.”
Jordan also does things that most dealerships won’t to move tractors. Customers in the dealership’s mar ket area are big on buying toys like motorcycles and boats, but they don’t always create as much happiness as their owner expected
When those feelings surface, Jordan turns them into sales. He’s taken in camping trailers, boats, used cars and horse or stock trailers on trade. He once took in a 1931 Model A for a small tractor, and more recently he took in a 4-year-old Harley Davidson motorcycle with only 1,800 miles on it.
Why does he take those chances?
“Taking trades makes deals come together,” Jordan explains. “You need to have enough cash to take trades, but it gives you a big advantage over the competition. Open a door for a customer and give them a reason to deal with you.”
Running Lean and Mean
Jordan says his dealership has stayed profitable by focusing on increasing sales, keeping expenses in check, spending advertising money wisely and ordering inventory conservatively.
He’s down one part-time employee this year who he’d like to have for deliveries, pickups and customer service. But with the economy still in a slump, he’d rather give the extra money to his current employees. That means employees are washing tractors, cleaning the bathroom, rearranging the lot, reordering parts or putting inventory away themselves.
“When times get better we can hire someone. In tough times the luxuries have to be put on hold,” Jordan says. “When I have to keep an employee busy and find work for them, that’s not good.”
With the sagging economy slowing the housing boom and cutting the pool of disposable dollars that drive most purchases in the rural lifestyle market, Jordan has faced tough decisions lately on how much inventory to order. Sales of compact tractors have in 2009 have been falling across the U.S. and Canada.
Jordan avoids floorplanning traps with tractors by ordering equipment conservatively so he can turn inventory 4 times a year. The turns allow Jordan take advantage of incentives for paying off the floorplanned tractors early.
“Fresh inventory doesn’t look tacky,” he says, “and it shows you’re on top of your game. You shouldn’t have anything sitting there past a year. You need money turning over or it’s not doing any good.”
Being a single-store operation with only 5 employees, Jordan doesn’t place a large emphasis on number crunching, although he notes the importance of getting deposits to the bank immediately so he can take advantage of trades and discounts on purchases.
“The sale is the most important number. If you sell more, the numbers change and your problems go away.”
The secret to moving tractors off the lot is pretty simple, both Jordan and Woodford say — product knowledge, and knowing when to stop talking. “You have to know your products, and your competition’s products. Know your strong points and weak points,” Woodford says. “I’ve always considered myself a product knowledge person instead of a salesperson. I don’t knock my competitor’s products. I just say what my product does and why it’s better.”
“If you just listen to the customer,” Jordan says, “they’ll tell you how they want to be sold, how they want to buy, and how they want to be treated. If you listen, the sale’s there.”
‘They Don’t Expect It’
With the dealership being located in a small community, Jordan feels relationships with customers are extremely important, whether it’s fixing a tractor when promised, paying for part to be shipped overnight, or dropping off a newly sold machine during the evening instead of the next business day.
Woodford estimates half the people who buy tractors have never owned one. “So you have to take some time with them. How much property do you have? Is it flat or is it hilly? What are you going to do with the tractor? I don’t want to oversell anyone, but I don’t want to undersell them either.”
When he delivers a tractor to a customer, he goes over the machine’s basic operations and then tells the owner to use the machine for a week and call him afterward if they have questions. If they do, he’ll make another personal visit. “After you’ve been on that tractor for a week,” Woodford explains, “your questions will make more sense and my answers will make more sense. Customers appreciate that.”
TYM also emphasizes keeping customers happy when their tractor’s in for repairs, including a “tractor down” policy that directs dealerships to get repairs done within 24 hours when possible. Jordan will have a part shipped overnight when needed or make other sacrifices to fix a tractor ahead of schedule. The dealership gives its promises about repair work in writing to minimize confusion.
Both Terry Jordan and Woodford include their cell phone numbers on their business cards so customers can get answers when they need them. Jordan’s employees say it’s hard to overstate how important that is.
“Our customers like the fact that the guy who sold and delivered the tractor to him is the guy to call when they have a problem,” Jordan says, and they’re not put off by somebody in the service department, who doesn’t know who they are, who’s trying to make the salesman’s promises come true.”
Brian Jordan, who’s worked for several years in the car industry with his father, brings valuable experience as a service writer in knowing how to address the customer, how the bills are presented and how it’s totaled out.
He focuses on selling cars but backs up Woodford on selling tractors, and he also oversees the dealership’s Internet advertising and helps manage the shop schedule so the paperwork burden is taken off the dealership’s lone service technician.
Dealership of the Year Judging Panel
• Dr. W. David Downey — Executive Director, Center for Agricultural Business (CAB), Purdue University, West Lafayette, Ind.
Downey is responsible for the development of education programs at the CAB, which is largely regarded as the U.S.’ leading center for agribusiness education. A distinguished agricultural marketing professor and a proficient author, Downey also consults extensively throughout North America on a variety of agribusiness issues.
• David L. Kahler — Retired CEO of Ohio-Michigan Equipment Dealers Assn., Dublin, Ohio
Kahler spent his entire 38-year career assisting equipment dealer- principals with their business affairs, the last 20 as CEO of the association serving Ohio and Michigan. An active industry participant who earned the respect of both dealers and manufacturers, Kahler retired from full-time employment last January.
• Charles R. Glass — President, Glass Management Group, chairman emeritus, Farm Equipment Manufacturers Assn.’s (FEMA) Dealer Relations Committee, Arlington, Texas
Glass has been actively involved in the sales and marketing of farm equipment to dealers throughout his 40-year career. A board member of FEMA, he is also a frequent presenter and author, including several white papers on the future of farm equipment distribution.
“We try to get the customer an answer right away,” on repairs, Brian Jordan says. “I tell customers to bring (their tractor) in and drop it off, and if it’s something simple — which it usually is — we can get it turned around in the same day. Jack knows there’s nothing better than when they drop it off, thinking it’s going to be two weeks, and you drop it off 3 hours later and they have a smile on their face. They don’t expect it.”
Another key part of the dealership’s reputation for customer service is technician Sam Mann, who can work almost simultaneously on tractors, RVs and cars and not lose his place. Most customers feel Mann is approachable, which scores points for the dealership.
“He’s had a following with customers around here for a long time. They come in just for him,” Brian says. “A customer can show up at 4 p.m. on a Friday, and Sam never complains. It can be raining or 100 degrees outside and he’s the first one under the hood. He has the best attitude I’ve seen in all my years in business.”
There are tough competitors surrounding Jordan Sales & Service, but Jordan tells employees not to speak poorly about them because it shows a lack of confidence in their dealership’s equipment and it turns off customers.
“Without confidence in your staff and your dealership, your chances of making the sale are greatly reduced. All the tractors dig holes in the dirt. There’s more difference in the people than the tractors. We put them at ease by not criticizing the competitors’ products or the way they do business. We just say, ‘Here’s mine, and here’s the benefit of this, and here’s why we think they will do a good job.”
Planning for the Future
Because the dealership is relatively new, there aren’t many TYM tractors out there with high use or major repair needs. Jordan Sales & Service reported $86,000 in revenue on parts and service in 2008, and the dealership only services TYM tractors.
But Jordan is planning for the day when more tractors are coming in for work and customers have more than one brand of tractor that needs repairs. He expects to put a service truck in the field when the level of service work justifies such an investment.
While they’ll always be car buffs at heart, the Jordan family plans to spend more time and resources expanding the tractor side of the business. He wants to spend more money on advertising, “but we watch that very closely, and only spend money on ads that generate sales.”
There are still plenty of farmers in northern Idaho and eastern Washington who grow 1,000 acres or more of hay, or raise buffalo and cattle. Jordan isn’t selling a lot of tractors to them compared to rural lifestylers, but he’s seeing some new business due to referrals. Farmers who’ve been at it for 30 years won’t jump ship to a new brand just to save $2,000 on a tractor, he says.
The dealership plans to succeed with those customers the same way it has with rural lifestylers – hard work. “You’re not going to do it with a pretty little ad,” Jordan says. “We’ve got to earn their business.”