Following the news in September that Toro and Lowe’s would enter a strategic partnership through which Lowe’s will carry Toro zero-turn riding mowers, walk mowers, portable power equipment and snow blowers (both gas and electric), Rural Lifestyle Dealers’ editors asked readers for their takes. 

Dealers were asked how they think partnerships like these affect the industry and if they think we’ll see more partnerships like this in the future.

“Ultimately, it will be the customer who suffers by this move. Big-box stores such as Lowe’s are not equipped to service the equipment after the sale. Equipment dealerships spend thousands of dollars to train both their sales and service teams and have invested heavily in the stocking of necessary parts that will be needed to take care of the machines. This is not part of the big-box store formula, and such ‘partnerships’ will quickly diminish their reputation in the marketplace.”

– Kelly Emery, Emery Equipment, Baton Rouge, La.

“Manufacturers have and continue to have partnerships with big-box stores selling consumer outdoor power equipment products. This may hurt some dealers, and some dealers feel that it hurts the brand. The dealers that sell and service mostly residential consumer equipment are hurt the most. Many dealers today are focusing on selling to commercial landscapers, municipalities and large property owners who value the dealer relationship and parts and service from the dealer. I feel most OPE manufacturers have some products of some kind retailed through big-box stores today. The biggest change is which brand is being retailed through which big-box store. I think we will continue to see OPE manufacturers in big-box stores retailing consumer products, but growth will be minimal as the higher-end consumer customers value the relationship with a dealer who provides service and solutions for their equipment.”

– Dale W. Magie, North American Equipment Dealers Assn., Kansas City, Mo.

“I think the partnership between Toro and Lowe’s will affect the industry in a positive way. Toro produces superior equipment and does not manufacture different SKUs for big-box stores vs. dealers, like some other manufacturers do. I believe we will see more of these partnerships in the future, as the more visible and convenient a manufacturer is nationwide, the better their sales should be.

“From a dealer aspect, if the end user is not purchasing from me, I hope we can gain their business with parts and service in the future, which most big box stores cannot offer.”

– Jennifer Gott, Killian’s Hardware, Hickory, N.C.

“The obvious effects of these partnerships will mean less sales for dealerships as well as less dependence by customers on dealerships to meet their needs. I also believe this opens the door for Toro and other brands to expand their online sales since big-box stores already have the systems and infrastructure in place to offer these units for sale online. Although these partnerships will, in my opinion, lead to increased sales by reaching a larger customer base, the long-term effects will do the opposite. It is no surprise that big-box stores do not have the means to service and provide parts support to the customer, and by taking sales away from the dealerships, we are less inclined to provide service and parts support to an individual who purchases their equipment from a big-box store instead of us. If I have 3 zero-turns in for service, I am obviously going to prioritize loyal customers that bought the unit from us and not someone who bought theirs at Lowe’s, Home Depot or Tractor Supply. In turn, this will cause more and more customers to be annoyed with Toro for not providing the help that they require. 

“Additionally, by partnering with big-box stores, Toro will no longer be seen as one of the top brands in the industry. The average homeowner that sees Toro mowers in the big-box store will begin to associate them with the other brands at the store, such as Craftsman, Ryobi, Ariens, etc. This will hurt Toro not only in the residential sector but also for commercial customers that see their brand of mower they are proud to own now being sold at the big-box store. It shows that Toro values sales and revenue rather than customer satisfaction.”

– Name withheld

“It seems to me that these partnerships give the big-box stores an unfair and undeserved advantage over actual dealerships. While my time in the industry has been in parts rather than sales, and I have no experience in new equipment ordering/purchasing, I suspect the big-box stores have a purchasing advantage because of their volume. The volume in and of itself is not the problem; one of the main problems is that big-box stores offer little to no support after the sale. Their ‘support’ typically consists of exchanging products or directing the customer to an authorized service center. They usually have not made investments in a service facility, in getting technicians certified to work on equipment or in sending sales staff to dealer meetings to gain product knowledge. They divert sales from dealerships while leaving dealerships to do the ‘dirty’ work of dealing with the unhappy customer when warranty repairs have to be made and of facing the customer’s wrath when there is an issue not covered by warranty. 

Add to all this the fact that there is probably minimal, if any, customer education when a machine is sold by a big-box store, leaving customers with possibly limited knowledge on how to safely operate their new machine and care for it. It seems to me that these partnerships also help to condition the consumer to think in terms of ‘just give me another one’ when there is a problem rather than working through a problem and resolving it, which is what a good dealership will do. This mentality can be a trial to deal with in a dealership’s service department. As to your second question: Yes, I expect we will continue to see these types of partnerships develop. At the end of the day, most of these big corporations care about one thing: profit. On the one hand, they talk about how they value their dealers, but the other hand is stealing business from their dealers by giving it to the big-box stores.

– Justin Stauffer, Nolts Power Equipment, Shippensburg, Pa.

“I do not see this as a positive for the industry. I do wonder if Toro is being shortsighted on this.  Who is going to handle warranty and/or service issues on the items that Lowe’s sells? I doubt Lowe’s is looking to create a service department and staff it. I doubt the local Toro dealer is looking at this as a pleasing way to increase their parts and service business. Am I surprised by this venture? No, as we are moving more and more to a throw-away society, and the average home buyer is all about the monthly payment. This makes sense. It will net Toro with volume sales but at what ending cost?

“Yes, I do think we will see more of these deals. Fewer and fewer buyers are concerned with quality over quantity or price on their purchases.”

– Kevin Vandervort, Hoober, Intercourse, Pa.

“It’s easy for me to respond. I went through this before with Ariens and the big-box stores when I was a Gravely and Ariens dealer and sat on their dealer council. That wasn’t fun. The manufacturers like the big checks and minimal effort after the sale, where with us as dealers there is a lot more involved from sales, schools, service, parts department, warranty etc. The world is changing. Watch Stihl and Briggs; that should be interesting, as well! Just glad I am at the end of my profession.

– Name withheld

“We have known how Toro is just from being an eXmark dealer, but it has truly shown brightly since the purchase of Spartan/Intimidator. What is this, the second time around with Lowe’s?  Maybe TSC isn’t enough? Toro is ‘diluting the product quality of the name.’ Let’s face it, the machines that will be sold there are mass produced in Mexico. The new residential Spartan, to be introduced at this year’s dealer meeting, will be on the same assembly line as Toro and eXmark. There has already been talk of it going to a big-box store in the future. 

“The product just loses its validation of being a top name brand in the industry by doing this. Consumer’s look to these names as something that will last, not a ‘throw-away mower’ that they were not properly advised on how much acreage it will truly maintain. If Toro spent more time ‘cultivating’ their dealers, they wouldn’t have to go to a big-box store.”

– Name withheld

“My first thought is, other than a new brand, this is nothing new. They [Lowe’s] have had several different brands over time, including John Deere — too many to list. Some last longer than others, but all are at risk of being replaced by the next manufacturer with a better deal!

“We carry Kubota, Cub Cadet and Husqvarna with decent unit sales numbers. Customers with Kubota tractors and Stihl handheld product purchases tend to buy turf here, as well. The parts and service departments are our consistent profit-makers, and Lowe’s does not compete very well in those areas. As stated in the beginning, nothing new. It has been this way for a number of years, and I don't foresee any change.”

– Wayne Blankenship, Rocky Mount Tractor, Rocky Mount, Va.

“These types of partnerships are designed to bring brand awareness and increase unit population to the consumer market.

“They do create some issues for surrounding dealerships that sell the same brand and ultimately offer up options for those dealerships to participate in or opt out of the supporting follow-ups required by a sale from a big-box store (big-box stores are not equipped or prepared to fully support the product that is sold). I think there will be more in the future as we transition to online selling, but there will always be a need to support the product somewhere, and this is where the dealership organizations come into play. The issue there is the manufacturers do not reimburse dealers enough to cover expenses, so this becomes a deeper issue for dealers.

“As a John Deere dealer, we have been dealing with this for a number of years, and it does create a lot of disappointment for customers. They realize shortly after they purchase from a big-box store that the store does not support the product and will then need to visit a dealer or have an onsite technician come to them. There then is the issue surrounding who pays for what, and that creates the challenge for us as dealers.

“There are some products that the big-box store will sell for less than we can as dealers, so there is not a level playing field in this regard. As well, availability is given to the big-box stores vs. dealers. Dealers have a much larger investment in the product, training of staff for parts and service, stocking parts and accessories for units sold, technology and software required to sell and service all products.

Bottom line, is it a good thing for dealers? Not really. Is it good for the manufacturers doing this? Yes.

– Joe Neto, Fulline Farm & Garden Equipment, Glencoe, Ont.

“We think that big-box/manufacturer relationships can be both good and bad for dealerships.  Dealers benefit from economies of scale, and the manufacturers gain by working with big-box locations. John Deere, for example, has better purchasing power with suppliers for L&G parts for both the premium line and the economy line that is offered through THD/Lowe’s network due to higher unit volumes that wouldn’t be possible without the relationship. In addition, we have been able to gain service work and customers from the big-box stores through our service options and support. On the flip side, we have also seen upset customers from the lack of service they have received at some big-box locations. We have also seen confusion when they get misinformation from a big-box store on like/competitive products. 

“In the end, it really depends on how the manufacturer executes on the strategy. The basis of the strategy needs to be one that complements the dealer network by providing clear product differentiation between what is offered through the mass channel and dealer network.  Without that, confusion will certainly result.”

– Thomas J. Sutter, LandPro Equipment, Falconer, N.Y.

“In my opinion, these sorts of moves weaken independent dealers. Lowe’s will no doubt sell these units online or in-store and work out a deal with independent dealers to prep and deliver them. Similar to what Home Depot was doing. Home Depot paid dealers a flat fee ($200.00) to prep the machines and deliver them to the customer. We got to choose how far out we would deliver for that amount. It pales in comparison to what we would make on the machine. The hope was/is that these customers would become parts and service customers.

Lowe’s offers customers an 11% discount on purchases if people use their in-house charge – their Lowe’s card.  This circumvents the manufacturer’s MAP (minimum advertised pricing) structure and takes business away from local independent dealers who are unable to compete. As part of our dealer agreement, we are unable to advertise lower than these MAP prices or we violate the dealer agreement.  Something isn’t right about this. Lowe’s will surely make up the difference by getting interest on their in house charge cards.

We are a Toro dealer. We love the Toro brand. But when Lowe’s and other big-box stores destroy independent dealers, there will be no service or warranty centers to provide support for the units sold. Plus, the sales associates at big-box stores don’t know the product like independent dealers do and can’t really advise them on which machine to purchase for their needs like we do.

– Name withheld

“In short, many of the affected dealers hate these relationships. Not as much as the consumer does the first time they need service and the dealer puts them on the bottom of their service repair list. When that happens, no one wins. The consumer is mad, the dealer gets mad, and that is a problem.

“It has been going on for years, too. Starting with my old friend Dave Zerfoss, then president of Husqvarna, who said they went into a Lowe’s store because they wanted the biggest dealer in every town. That was the start of the mass merchant connection. I think Murray initially started it with Walmart, but the Husky one really broke the ice when they went with Lowe’s.

“With that said, it is already happening, and nothing will stop it. The consumer and dealer will continue to fight for their reasons to exist in the equipment arena. Things like longer hours and price advantages make Lowe’s and Home Depot the place to buy, which is just reality. Rural dealers with no mass exposure do well.”

– John D. Hedges, Medart Inc., Arnold, Mo.

“I fully understand manufacturers like Toro wanting to increase their distribution and volume by entering big-box stores. Having spent a career in ag and consumer product dealerships, I also have witnessed the erosion of the perceived quality of lines after they hit the big-box floors.  While the big boxes don’t normally undercut the price of these lower-end mowers and attachments, they certainly capture sales that might be made by the local dealer by offering longer store hours, reward points and retail credit cards.

“There is a local Toro dealership in the town I live in. They market the entire Toro line. If a customer brings in a mower at 4:59 PM on a Friday afternoon and tells the service manager that he needs his lawn mowed tonight because of a graduation party tomorrow, this dealer would stay and fix it if possible. And if he can’t fix it then, he would probably give the customer a loaner. Good luck making that happen at a big box.”

– Leo Johnson, Machinery Advisors Consortium, Milton, Wis.

Rural Lifestyle Dealer additionally reached out to Toro concerning the partnership and received the following statement:

“Not only is there space in the industry for our best-in-class dealer network to thrive alongside leading mass retailers, but our strength in both areas creates additional value for customers.

“Ultimately, our shared customers decide how, when and where they want to shop. However the customer comes into the Toro community, we know that the post-sale experience exposes our trusted dealer network to new customers. 

“The added volume from mass retailers and dealers alike helps to fuel even greater research and development investments, creating more value for customers.

“Shopping behaviors, and therefore the retail landscape, are continually evolving, driving the opportunity for change. With every business decision we make at Toro, we keep our channel partners top of mind.”

– Tom Werner, Managing Director, Marketing for Toro’s Residential and Landscape Contractor Business

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