Dealer Turnover Rates

[East_TX_Spa]

Since I found this site a couple of months ago, I cannot begin to tell you how much GREAT information I've found from both customers and other dealers.  It is fantastic and has helped me clean up my sales presentations as I realized I had started getting a little too self-assured about our company and products.

My store is in a small town of about 75,000 people in NE Texas.  There are currently only 3 other dealers selling spas here and they are primarily swimming pool, billiard, outdoor furniture dealers.

We opened this (our second store) exactly five years ago.  All we have ever sold are Watkins spas, nothing else.  The other dealers have had a revolving door policy regarding spas.  I've tried to compile a list of what's come and gone during this five year span:

(Edited to remove names of companies-CEO)

The 3 dealers have carried a total of 21-25 brands during the 5 years.  (Two other dealers went bankrupt)

Currently, Bullfrog, Catalina, and Dynasty are the only others in town.

I guess the point of my post is a question for other dealers around the country.  Do you see this kind of turnover in your areas?  It has got to be difficult to build up any type of customer loyalty when every six months to a year the dealer changes brands.

I'm sure not trying to start anything by asking this, it just makes the industry as a whole look kind of shady.

Any feedback is welcome and appreciated.

CEO

[Lori]

I know I'm not a dealer, but I believe you have a point!

When I was looking in 2003, Marquis was being carried by the same dealer as the Sundance brand.  There was someone around here a few months back who was looking, and Marquis is now being sold by the LA Spa dealer.  Just makes me wonder.  Of course, it doesn't surprise me the Sundance dealer either lost Marquis, or gave them up, the guy wouldn't even talk to me about them.  Would only talk about Sundance.  He said they hadn't had the Marquis line very long, and wasn't "sold" on them himself!

Makes you wonder!

[hottubber]

I fully agree with the fact that there really is not alot of loyalty from the manufacturer to the dealer, then of course to you, the homeowner. When a dealer drops a line of spas frequently, who services that customer who bought that brand from them.
I have been a loyal Sundance Spa dealer since 1983. I have had various low end spas, if you will, to compliment the high end profile of Sundance.
As expansion continues in areas where there may be a conflict with brand S, I am forced to bring in a high end spa brand that is somewhat comparable to what I am used to.
Dealers locally can't seem to stop the "revolving door syndrome",today brand C is the best, tommorrow it's brand J. It's just not good for the industry, it's unfair to the unsuspecting prospect and definately not good for the dealer.
I don't know if I can list the brand names as you did, but I will tell you that the majority of those spas are no longer around

[East_TX_Spa]

Hottubber,

I edited my original post to remove the list of companies.  I wasn't using my noggin.

CEO

[hottubber]

East TX,
I was wondering why you printed that? Isn't it crazy that so many spas come and go and no one if left to  service the customer. I don't have alot of technical background, but I will tell you this much. Spa service companies that can service everything out there will make a fortune and name their price to do it. .

[spatexport]

"Spa service companies that can service everything out there will make a fortune and name their price to do it."

Are you sure about that?  I thought that one performed spa service out of pure enjoyment?

As for manufacturer loyalty and dealer brand turnover, I don't know.  I suppose the manufacturer is happy when a dealer does a good job in sales and service and the dealer is happy with a solid product and manufacturer support.  

The revolving door business model is a red flag.  

Slow and steady wins the race.  

[wmccall]

I know that just in my area, in the 2 years I have owned my spa.

The D1 dealer is now carrying Coast, The only Marquis dealer is gone, A bullfrog dealer came, left, and another one took over.  I think a Vita dealer moved on.

The two dealers that do the most advertising here are still around, they carry  1. Hot Springs/Cal/Viking and  2. Master/Hydropool.  There is a 3rd dealer that has remained and seems to be doing well, they carry Sundance and Jacuzzi.

My dealer changed to Dynasty, from Cal a couple years before I purchased and still is the only Dynasty dealer around.

[Chas]

Here in my local area we have had a few dealers come and go, but my main competitors have always been selling some of the big names:

Sundance,
D1
Cal Spa
Coleman

So they have tended to be pretty stable. Darn it....

[poolboy34]

We have 4 main competitors in our immediate area and they sell the following:

Hotspring, Solana, Tiger River, Vita

Jacuzzi Premium, Leisure Bay, Pacific

Emerald, Saratoga

Sundance, Sweetwater

The only changes that have occured in that list is the hot spring dealer dropped hawkeye spas in favor of Vita, and the Leisure bay dealer recently started carrying Jacuzzi premium.

Jason,
Store Manager for a D-1 & Caldera Dealer

[HotTubMan]

I do not think changing brands is a 100% sign a dealer is questionable.

For many reasons (i have listed them b4) other than product quality we stopped selling Beachcomber this year and found two other top notch brands to replace them. D-1 & Coleman.

At the start of 2004 Beachcomber had around twenty dealers in Ontario (Canada's largest province, close to 10 million people) and now has 5 or less.

Does that make me a questionable dealer?

Or

Does that make you wonder why so many loyal dealers stopped dealing with them?

My 2.4 cents

HTM

[Steve]

Since you asked for my opinion...

As HTM mentioned, it's not generally a sign of instability of a local dealer and I tell you why;

I think as manufacturers evolve and become more mature in their sales and marketing, as well as recognize any quality concerns; they become more inviting to a dealer that is just getting by with a current line that offers little support. When a company is determined to see their dealers become successful and gives them the tools to do so, it has the potential to give a certain level of appeal to dealers who don't currently receive this.

HTM brought up Beachcomber and it's really sad to see a company positioned to be top 3 a number of years ago, falter as they have. The product is still very good but the lack of sales and marketing savvy has cost them. They simply don't have the people that can take that company to the next level. There are some fantastic individuals there but they can't do it on their own. We'll see what the future holds. Last year, if I'm not mistaken, we built more spas than Beachcomber and have taken a very aggressive campaign to position ourselves to be the top Canadian brand. The foundation is now in place and our dealers are blown away by what they're seeing. Give us 3 years…

My point here is that we are reaching a critical time in our industry and those that have the capabilities, will move up the ladder quickly and be positioned strongly. Potential dealers can see this and a quick comparison of what many other manufacturers are doing out there gives them cause to consider this move to better themselves and their company. If you were a business person, this would be considered a smart business move and not a show of instability. We constantly strive to be better at what we do and surround ourselves with quality people to quicker achieve our goals. Same applies in business.

Steve

[zzaphod42]

At the start of 2004 Beachcomber had around twenty dealers in Ontario (Canada's largest province, close to 10 million people) and now has 5 or less.

Does that make me a questionable dealer?
Or
Does that make you wonder why so many loyal dealers stopped dealing with them?

5 or less dealers in Ontario? Are you sure you don't mean 5 or less in Toronto?

I know for a fact that there are many more than 5 dealers in Ontario, and some dealers (myself included) have multiple stores. You might want to check your figures...

I do agree that because a dealer changes brands doesn't immediately mean they are to be avoided. However, if this was a regular thing for them that would make one question why.  

I don't feel that any manufacturer is perfect, (no Chas not even Watkins ) so if a dealer drops a brand at the slightest hitch, that shows in my opinion, a lack of loyalty. I know that wasn't the case for you HTM, and I understand a bit of why you made the switch.

Beachcomber definitely changed a few things to more clearly position themselves in the industry. Not everyone liked it, and they moved on. HTM is a perfect example of someone who switched brands and continued to be successful (or became more successful).

Steve: Nice sales pitch, you truly are a master

Steve wrote: "I think as manufacturers evolve and become more mature in their sales and marketing, as well as recognize any quality concerns; they become more inviting to a dealer that is just getting by with a current line that offers little support."

I write "The grass is always greener on the other side."
(Okay so I am not as original, that's why he is the developement partner.)

What I mean is that there is always going to be the new "up and comer" that is going to blow the industry away. Some will have staying power, and some won't. Likewise those that have been in the industry for a long time are there for a reason - they have done and probably will continue to do things right.

Joe

[Steve]

Great post Joe!

[wmccall]

From this thread and others like it in the past, Is it safe to conclude their can be multiple reasons for a dealer turning over his main brand. Some can be the result of dissatisfaction with the brand/service,  Some can be caused by the Manufacturer.  Either way, it can be confusing for the consumer and no doubt some competitors will try to take advantage of that.

[poolboy34]

Sometimes dealers stop carrying a brand due to:

changes in a manufacturers upper mgmt

Dealerships' owner doesn't get along with higher ups in manufacturer

Opportunity arrises to carry a more "high Profile" Brand of spas

Manufacturer is bought out, and new owner "cleans house" of the dealer network

manufacturer goes out of business

Due to changes made to spa line, it no longer fits into a price point the dealer is trying to hit with it.