Question: "If you sold your dealership tomorrow, what advice would you give the new owners?"
“Take care of my customers and employees as I have for the last 46 years.”
— John S., Foley, Ala.
“Don't sell anything — just solve people’s problems! If you make your customers successful, they will make you successful!”
— Don S., Tontitown, Ark.
“Always look at new lines and diversify in any way possible! Be attentive to your customer’s needs, and follow up on every customer, sales, parts and service. Create a one-stop shopping atmosphere. Train your employees and keep them updated to all service bulletins. Listen to the industry trends, while keeping a close eye on your local market demand. Never keep old ideas that do not work. Try new approaches and monitor the results. Love the tractor business or stay out of it. This isn’t a 9-to-5 business. Be willing to invest the time, not just the money!”
— Allen B., San Marcos, Texas
“The business runs in cycles. There will be good years and bad years. Be prepared for the bad years. Don’t depend on whole-goods sales to be profitable. Depend on parts and service. Don’t sit on an over-priced, trade-in tractor. If the market has gone down on a model, take the loss and move on. Don’t make matters worse by sitting on the unit until you lose more money on it. Don’t listen to the suppliers wanting market share at the risk of overstocking you in high priced trade-ins.”
— James S., Dale, Wis.
“I would tell them to have adequate cash set aside to run the business through the highs and lows and to make smart purchases at the very best price. A poorly capitalized business is at a disadvantage in all areas.”
— Dave S., Red Bluff, Calif.
—Greg B., Crockett, Texas
“If I were to sell my business, the best advice I could give to the new owner is to take care of your customers before and after the sale. Go the extra mile for them and they will take care of you. There is no such thing as brand loyalty anymore, but there is dealer loyalty. Have a good sales department that is honest and true and backed with a great service department and parts department with courteous and prompt help. Treat your customers like family. And if you make a mistake, make it right.”
— James L., Metropolis, Ill.
“Prepare to invest more than you’re comfortable with in marketing and advertising. If you don’t, the business will flail. BUT, know who you are marketing to. Don’t waste those precious dollars on random marketing efforts. Be clear about who your target audience is, and market directly to them through any means possible that you can afford. Word of mouth as a means of marketing in this industry is HUGE. Therefore, never doubt the importance of a good warranty and excellent timely service.”
— Amy D., Eureka, Mont.
“Success is all about the relationships both internally and externally. I would require the opportunity to job shadow the top management positions for no less than 3 months.”
— Don V., Perry, Iowa
“The first thing I would tell a prospective buyer of my business would be to know your customers. We can all learn about the equipment, tools, tractors, etc., and there are factory or sales reps to educate us more. But it's that ‘walk in their shoes’ sort of thing that you need to know. Who are your potential customers and what do they need? The broader your market, the more challenging this can be. We have small farmsteads that need things sized to their operation and budget, so featuring combines is not going to make sense. But if you are trying to service large and small, serious and hobby, urban and rural, etc., you need to understand all the needs and be able to switch as appropriate.”
— Conrad B., Bellingham, Wash.
“Keep the key personnel. They know how things run.”
— Bob W., Courtenay, British Columbia
“Don't forget where the money comes from, even if your suppliers do. Watch the suppliers. They only care about today and themselves…not the future. Always VOTE. This can help cut more government mandates.
— Paul B., Concord, Vt.
-“Surround yourself with really good people and let them do their jobs. It is very difficult to be an expert in all areas. When dealing with suppliers, customers and employees, act like a servant, not a master. If generating a profit is not one of your goals, you will probably meet your goals.”
— Leo J., Janesville, Wis.
“Look after the staff, they are the dealership. And get rid of the 5% of most troublesome customers.”
— Paul H., Brandon, Manitoba
“Under promise and over deliver in service and parts.”
— Dick B., Huron, S.D.
“I would tell them to always be positive and enthusiastic, no matter how the day is going. Your employees and customers feed off the way owners and management portray themselves. Believe in what you are selling. Always listen to your employees and customers. COMMUNICATE. Always be honest and dependable. Service is what built this business. In most cases, the salesman makes the first sale to a customer, but it is because of the service department that you will get repeat business. Always follow through on a promise and follow up after the sale. Keep in good graces with your suppliers. Support the communities you serve, and you will be paid back tenfold in the long run. Always be humble and respectful to the customers and respect your employees, for they are the ones that will make or break your new business.
— Scott V., Ireton, Iowa
“My advice would be to never balance your checkbook on Friday and never check sales before 2 p.m. Both will ruin your day.
— Greg W., LaFayette, Ga.
“Differentiate your dealership by providing superior customer service. Focus on profitability and absorption rate in service and parts departments — these departments should be your cash engine. Build a foundation for growth. Dealers who do not continue to grow, either organically or through acquisition, will not be around five or 10 years from now. Employ great people who earn their pay. Take care of them and help them grow.”
— Matt M., Plainfield, N.H.
“Be well capitalized with as little borrowed money as possible. Hire experienced parts and service managers. They can make or break you. Don't think you have to have every contract that comes along. Not all are profitable. Watch parts turn and take advantage of all disc ordering programs and work all parts returns so you don't accumulate a lot of dead inventory.”
— Earl B., Terrell, Texas
“Take everything with a grain of salt. Play competition to your own favor when given the chance, and do almost whatever it takes to seal every potential sale because in the beginning, each one is important. Also, be careful of what a customer tells you because they will say anything to save a dollar.”
— Todd T., Roxboro, N.C.
“My advice would be to get ready to meet some wonderful people as customers. You need to listen to them because you will learn more from them than from sales and product schools. You also better learn to be honest with them and be consistent with your pricing. Lastly, you sometimes make more money not getting a deal than you do if you sell to certain customers.”
— David H., Dayton, Va.
“Take care of customers and they will take care of you. Be honest and fair with them.”
— Dave B., Southbury, Conn.
-“Do not rationalize what you can allow for your trade-in used equipment. Too many dealers talk themselves into investing more into the used trade-in piece of equipment, so they can ‘win’ the deal, when they end up losing in the long run. Learn which deals to take and which deals to walk away from.”
— Ken D., Lancaster, Pa.
“Have a good business plan for your own business and follow it.”
— Terry O., Hall, N.Y.
“Watch every penny and watch inventory due dates. Interest hurts the bottom line. Don't order more on your spring order than you need (because many different terms can come due all at once). If your techs aren't putting out the work to make your service department profitable, replace them as soon as possible. Balance your life. All work and no play isn't a life. And, remember, on the frustrating days, this too shall pass.”
— Heather C., Norwood, N.C.
“Maintain your customer base. Our business was built on customer confidence. We sold a lesser known product against the best-known products and our customers bought from us because of our product knowledge, presentation and our commitment to provide quality service after the sale.”
— Terry J., Post Falls, Idaho
“My advice in doing a stock purchase of a dealership is to audit the financial statement to be sure all assets and liabilities are correct. Don’t count on the suppliers to be eager to do business with the new owner. Look at the employees real hard to see if there is any obvious problems and bitterness with the purchase. Be extremely careful that there isn’t unnecessary employee competition between multiple stores.”
— Randy S., Pa.
“What a tough question. I think I would tell them to hold on because it will be a wild ride. The equipment business has been up and down over the last decade and even with the economic problems, rising fuel costs and increases in raw materials, it’s still a very viable industry. I think the dealers that remain strong now and look outside the box for alternative revenue streams and diversification of their business will be in great shape when the economy takes a turn for the better.”
— Paul H., Fenton, Mo.
“Be prepared for the ride of your life. There are very few certainties and the cycles are deep and long. Customers are the best and customers are the worst. Employees will count on you like a parent; you will feel like a parent; and the buck stops with you. Sometimes the best choice is to get control of your emotions, walk away and then come back. Be a good listener. KNOW your books and the numbers. Do not tolerate poison employees. Finally, make sure everyone thinks you enjoy and relish the challenges, because it builds confidence in the team.”
— Steve D., Vancouver, Wash.
“My grandfather told me you would never go broke taking a profit anytime you can sell equipment. Just don't get greedy.”
— Bob D., Fayetteville, Ark.
“The only thing I can say is it is always easier to sell 'brand name' equipment, but there are plenty of other brands that have better quality and the companies are usually easier to deal with. And customers aren’t just buying equipment, they are investing in a dealership and should be taken care of. Too many dealers just take the customer’s money and forget about them.”
— Bob R., Cherry Creek, N.Y.