Dealers reflect on this year, share expectations for 2016
Shortly after Labor Day weekend, Outdoor Power Equipment magazine asked several OPE dealers to reflect on the past year and look ahead to next year. Specifically, we asked them the following two-part question:
How has your dealership fared in 2015, and what are your expectations heading into 2016?
Based on the following written responses, listed in the order they were received Sept. 15-24, we’re pleased to report that most dealers were enjoying a successful 2015 and expressed an optimistic outlook about the coming year, assuming that Mother Nature cooperates of course.
Business has been very, very good with no slowdown in sight. Two-cycle, mower and now leaf vac sales have been strong. One way I track growth is by tracking how many new customers come in and how much they spend per visit. Repairs have stayed steady, keeping the guys in the shop on unlimited overtime. We just added a new guy, which should take some of the burden off. My outlook for 2016 sees continued growth, and if we have another snowy winter, I feel it will be a blockbuster.
— Matthew Borden, owner
Ed & Matt Equipment
2015 has been a remarkable year! One of the best in our 49-year history!
All phases have shown significant increases in volume and profits! Unfortunately, whole-good margins continue to decline!
Uncertain as to what 2016 could bring…hoping a repeat of 2015! Not sure if that is realistic, though!
— Ernie Butitta
Baton Rouge, La.
Tractor sales for 2015 projected at -10 percent primarily because the factory ran out of 30- to 35-hp. tractors for 90 days in the spring.
— Gary Mize, president
The Tractor Place Inc.
Coming off a good 2014, we were hoping customers would continue to shake off bad economic news and start to spend money again. So far, 2015 is our best year in the last eight. The decision to slide away from OPE sales to focus on service and our rental department has been a sound business decision. We kept our shop busy all summer by accepting discount-house equipment with mostly word-of-mouth advertising.
A few disturbing observations I have made over the last year. Customers are willing to make larger OPE purchases from non-servicing retailers, purchasing zero-turns and large UTVs from the discount retailers. The other disturbing observation is the increased use of no-name Chinese engines on brand-name equipment.
After a very cold and snowy winter, our service department has an early influx of snow equipment coming in for maintenance.
— Rob Leiser
Leiser’s Sales and Rental
Even though we had a late, wet spring, our sales across the board were good. In particular, commercial mowers and mini-skid loaders did very well. Boat and outboard motor sales were down a little due to cool temps and high water on the rivers, but still not bad. Mid-summer sales were flat and extended a little longer than normal, but we’ve had a surge in the last few weeks, which has almost completely depleted our mower inventory. Starting the 2016 ordering process with almost no carry-over, presents us with an opportunity to participate in booking orders at a comfortable level, reducing our risks, and allowing us to shift a portion of our purchasing power to expand stocking levels in non-mower lines. As mower profitability continues to erode, and competition and financial risks rise, it is ever more important to develop other lines of revenue. As we go into the next year, we will continue to de-emphasize the mower portion of our business in favor of lines that provide a better opportunity for profit and return on investment.
In the short term, our outlook for fall and winter are optimistic. We are already seeing interest in our alternative-heating appliances, and we have a very good supply of wood-heating pellets in inventory. Fall service on mowers is strong, interest in construction equipment is building, and our online parts sales are doing well. Of course, weather, fuel prices, and economic developments will be the determining factors, as always.
— Roger Zerkle, owner
Flat Rock, Ill.
2015 started a little slow. Spring was late in arrival. When it hit, we were very, very busy. I cannot remember a time when we were still backlogged two weeks in July. Going into the winter, we are hoping for brisk snow sales when we finally get our shipments in. For 2016, Simplicity’s new zero-turn promises to be exciting, but as we all know, it mostly depends upon the weather.
— Todd Biddinger, manager
T&T Outdoor Power & Rental
Our 2015 has been better than expected; total revenue up 16 percent just shy of $500,000 up. Good grass-growing year with just enough rain when it was needed.
Our recreation side of the business has struggled, but dollar-wise has done better than last year. I think most sales are brought on these days out of necessity (i.e. their current machine is beyond repair or too much to repair). We are not seeing much loose spending.
I have been at this over 35 years. One thing I always try to do is make sure I don’t let the manufacturers get us too loaded up in any one area, meaning whole goods & parts. They all are always devising ways to make you take more. Next year, we could have a drought with no grass to cut, or this current administration could finish the job of flushing our economy completely down the toilet. $8 trillion to $19 trillion in debt.
If I ran my business like they run theirs, I would be out of business.
— Daniel N. Falcone
Hilltop Sales & Service, Inc.
To start, 2015 was a great weather year. Our sales on whole goods and parts were that of a typical good weather year. Our shop was a different story. Shop profits are about half of what they should have been. My service manager has been telling me the same thing for the last two years: a lack of big jobs and a lack of overall work in general. However, when I dug into the situation, I found we had lost one huge customer, and his name was Mr. Warranty. I blamed it on complacency. Either the customer or the manufacturer pays; we aren’t eating anything.
I have backed out of the day-to-day operations, but I made some suggestions to my service manager, and we’ll see where that gets us next year. For the first time, I find myself allowing the tail to wag the dog, but I have four years until I retire and don’t know what else to do.
2015 was a good year. The Lord blessed us with rain all through March, April, May, June, July, August and September. The grass was spring-like all spring and summer sales, service and parts were great.
2016 will hinge on what type of weather we will receive. If the weather is like 2015, things will go well! If we get into a drought, things will get tough real quick! We will have been in business for 65 years this May 2016. I have grown up in this business; the only thing that can impact this industry is the weather. I have seen downturns in the economy, wars, political unrest and industry-wide changes. Weather has always been the biggest factor in our industry, be it rain, snow or drought
— Herbert F. Beck, general manager
Wm. Beck & Sons Inc.
2015 started out slow because of the late spring. Then, the rain came, and it was like hitting the lottery; we could hardly keep up with the business, and by mid-July, it was like the faucet was shut off. I hope the faucet can be turned back on soon. It is still slow, and we are looking forward to fall and winter business. I think the mowing season is just about done in our area. I am hopeful that next year will be better, especially since we just built a separate warehouse to store more new equipment and repairs. But I know you can’t predict next year’s business because it all depends on the weather, and we can’t change that.
— Sally Miller, president