What's the Deal?

The editors of Lawn & Landscape and Commercial Dealer magazines believe ongoing dialogue between contractors and commercial dealers is essential. Each month, one contractor and one commercial dealer will address a question or issue posed by the editors.

This month’s question: “Should landscape contractors expect discounts? And, if so, should it be based on the length of relationship with the commercial dealer, volume of business or a combination of both?”
 
THE CONTRACTOR: Brian Akehurst, Akehurst Landscape, Joppa, Md.

“We don’t ask for discounts. Our dealers usually give us the best price. If I get a flier in the mail from the manufacturer saying next month they’re going to have a certain percentage off of an equipment line we’re looking at, I’ll hear from the dealers they’re giving us that price or better anyway.

“I think it’s a combination of how long you’ve been with them and how much you’ve spent. The volume also matters. New vendors, depending on how big of an order you put in, might tell you one price and then as soon as you tell them you want a larger quantity, they’ll get back to you with a revised price. With our existing vendors, we know we’re getting the best price when we tell them what we want, whether it’s one or five.

“We go to more than one dealer because we can’t always get all of the equipment we need at one place. Ten or 15 years ago, we came out and asked for discounts. But now, we just send out a spreadsheet listing what we need and dealers send something back with the pricing. If it’s in line with what we expect, we just go ahead with it.

“The relationship you have with a dealer is very important. You want to make sure they’re going to service you and stand behind what they’re selling. We’ve had situations where we’re happy with the equipment but not happy with the dealer, so we switched. To break a relationship with a dealer is tough, especially if you’ve had a long relationship, but we’ve switched from dealerships before because we weren’t getting the support we wanted or needed.”

THE DEALER: Glen Whirt, Plano Power, Plano Texas

“If it’s a long-time customer who buys in large volume, sometimes we can provide discounts. But discounts just take away from the gravy. We have to remain profitable and most of our products go for suggested retail. There are very few customers who are long-term and buy large volume who get discounts. Some of the manufacturers offer fleet programs where if they buy so many pieces of equipment then they get a better price.

“But I can’t afford to take the bite with too many discounts and continue to run a business in a profitable manner. Those margins are designed for us to be healthy, and we want to be healthy.

“If you let some contractors get a discount, they’re all going to expect it. For example, if you give priority treatment to someone who is commercial, then every guy who mows the next door neighbor’s lawn becomes commercial. If you give them an inch, they’ll take a mile.

“I have to tell contractors I can’t give them a discount every day. I have to explain to them that we have to make a profit to remain here. If we don’t remain profitable, we’re not going to be here next year to serve them. Most of them understand this since they also have to charge enough for their services to remain profitable or they won’t be there to buy from us next year.

“I get asked for discounts many times a day. Everyone has a different approach to it, but the basic answer we give them every time is ‘No.’”

If you’d like to say what’s on your mind for future issues, please e-mail Mark Phillips at mphillips@gie.net.