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Dealer cost on new equipment?.

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Jonboy

09-14-2004 16:03:01

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Hello, I'd like to know if there is a way to find out what a dealer pays for equipment. I'd like to find out how much my local dealer pays for that Rhino GR72 rotary cutter so I'd have bargaining power. $4,500 is pretty hefty price and I'd like to see if I could get him down alittle, I am at a big disadvantage because he has to order one, so it isn't like something thats been kicking around on his lot for awhile.
Thanks in advance!

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WPope@rmhllc.com

09-16-2004 15:05:46

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Re: Dealer cost on new equipment?. in reply to Jonboy, 09-14-2004 16:03:01

Old chinese proverb: "Shop three places, then buy".

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Halbert

09-15-2004 07:27:22

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Re: Dealer cost on new equipment?. in reply to Jonboy, 09-14-2004 16:03:01

You got some good advice here and some BS along with it. You really have two alternatives: shop around for the best price maybe considering a few other makes that are close in specs or find someone else who has bought one and see if he likes it and what he paid.

There is nothing wrong with doing a little shopping but on the other hand you don't have to squeeze the last $100-200 out of the deal either. A cutter's not the most complicated thing in the world like a new tractor where you need dealer service. If you can get a much better price 100-150 miles away and it makes you feel good and you can pick it up, then take a ride and do it.

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traitor

09-15-2004 06:51:57

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Re: Dealer cost on new equipment?. in reply to Jonboy, 09-14-2004 16:03:01

I also have a buddy selling for large car truck dealer in co, he said the sales manger tells all sales people to do their best to bend over the customer, and stick it to em,,one guy he said paid 15000.00 over invoice on a truck, so Id say you had better know the cost of a item when trying to buy,,,,, ,,,,, ,,,,, ,

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09-15-2004 07:12:29

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Re: Dealer cost on new equipment?. in reply to traitor, 09-15-2004 06:51:57

Sounds as though the sale manager must have the ethics of a peice of sh**. It does not help to know the cost of something in this matter, if this guy is this kind of person, he would take advantage of his own mother.

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James in NC

09-15-2004 05:33:30

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Re: Dealer cost on new equipment?. in reply to Jonboy, 09-14-2004 16:03:01

I believe the question that you really need to ask is "Has anyone out there purchased a Rhino GR72 mower, and if you don't mind what did you pay for it?"

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Lil-Farmer

09-15-2004 03:18:58

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Re: Dealer cost on new equipment?. in reply to Jonboy, 09-14-2004 16:03:01

Yep, I always got a better deal at Honest Harry's, right up to the day he went bankrupt!

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TimFL

09-14-2004 22:05:55

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Re: Dealer cost on new equipment?. in reply to Jonboy, 09-14-2004 16:03:01

I read the prior posts and have to chuckle. Seems everybody is really concerned with the dealer making a profit. I agree that the dealer should be able to make a profit. What I dont agree with is me having to pay for the dealers shoddy business practices. Let me explain,,, there is a local dealer that is always higher on their prices for sales and service. The funny thing is when you go there there is a pile of employees standing around doing very little. When you send in something for service the labor time is always high. I dont think I should have to pay extra just cause the dealer cant manage his business. Now there is also a dealer that is about 150 miles away that will always be cheaper without a fight. But the sales man delivers himself.
When I do everything in my power to run my business as efficient as humanly possible I shouldnt have to pay the dealer to have a bunch of high payed employees standing around doing nothing. They drive new vehicles when mine is 6 years old. They operate out of a palace while I struggle to keep the tin on the barn roof. I am on the farm busting my tail while the guy that owns the dealer is out deep sea fishing on HIS boat.
When you talk about profit what are you talking about? Jonboy, I would make some phone calls to other dealers. Alot of dealers would be happy to deliver to you 75 miles away. If you plan to put it together yourself consider having a dealer drop ship to you. Check Bush Hog, Woods, etc. for comparable products to compare prices. Dealer price will change most times from dealer to dealer. A dealer that sells much volume will get a better dealer price usually when you add incentives from the manufacturer. Take some time and find a dealer that WANTS your business.

Tims$.02

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kyhayman

09-14-2004 19:00:47

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Re: Dealer cost on new equipment?. in reply to Jonboy, 09-14-2004 16:03:01

I cant tell you what his cost is. One thing I have learned is there is a lot of variability. I'll buy 2-3 new and used pieces of equipment a year at a dealer plus what I buy at sales to trade.

I look at 10-12 dealers in a 200 mile radius. One thing I have consistantly found is that one dealer always has the best price but will not negotiate off it. He does have a good used equip business and gives the best trade ins. Case in point, NH 256 hayrake, new, 5 years ago. Prices ranged from $3800-$4900. Used is a tougher market.

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kyhayman

09-15-2004 18:10:34

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Re: Dealer cost on new equipment?. in reply to kyhayman, 09-14-2004 19:00:47

Actually I buy 2-3 new or used pieces to use. I am also a 'trader' in used equipment (I buy, sell, and trade most anything if the price is right). Never bought a piece strictly for a trade in. Only stuff I trade in (as oppsed to trade/sell off the farm) is things that I can get a better price from a dealer in new stuff than I can get myself or stuff that I dont want the 'reputation risk' of selling off the farm.

The dealer I buy most of my new stuff from handles numerous short lines of new machinery and an extensive line of used tractors (no new tractors). If he sells it new he gives a trade in premium, also gave me an obscene trade in on a Rhino 'batwing' that he sold me new. His cash price on a new BH 15' was over $2000 under the competition and his trade in offer was over $1000 better. Not to say I wouldnt buy a piece if I could get it right and use it for a trade in.

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Farmered

09-15-2004 04:30:16

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Re: Dealer cost on new equipment?. in reply to kyhayman, 09-14-2004 19:00:47

Hayman,
I find it interesting that you said you buy equipment to trade in. I am surprised that no one else picked up on that. Having been both a large farmer and a dealer I can say that used equipment is a liability. If you have used equipment take it to a consignment sale or put it out by the road with a sign on it. Then go to the dealer and ask for his best price for a clean deal. "Cash" does'nt mean anything to a dealer because it is all the same to him whether you have bucks in hand or financing. Another thing that I have found intersting is that a farmer will pay the price for parts but he will drive hundreds of miles to beat you down on the price of a tractor.
I found that selling tractors is something you have to do to get the parts business. Ed

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traitor

09-14-2004 18:49:26

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Re: Dealer cost on new equipment?. in reply to Jonboy, 09-14-2004 16:03:01

I used to sell for mother deere ,,,whatever list is take it times 77 % it will get you close,,plus there was always volume and special pricing but youll be in the ball park ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,,, ,,,

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Davis In SC

09-14-2004 18:48:39

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Re: Dealer cost on new equipment?. in reply to Jonboy, 09-14-2004 16:03:01

I like to get a good deal, but being in business, I realize the dealer has to make a profit to survive. Everyone should have to run a business for a while.... Even those days there is little or nothing to do, the expenses still go on. Years ago, my business partner taught me to always let a vendor make a fair profit, that way he will still be there next time you need something from him. I always try to follow that rule... Regards, Davis

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09-14-2004 19:37:02

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Re: Dealer cost on new equipment?. in reply to Davis In SC, 09-14-2004 18:48:39

AMEN

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NC Wayne

09-14-2004 18:19:51

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Re: Dealer cost on new equipment?. in reply to Jonboy, 09-14-2004 16:03:01

Looking at things from the dealerships point of view I have to agree with the other posts concerning the customer knowing in advance how much was paid for the item wholesale. The dealer is gonna have to add on enough to at least cover his overhead and hopefully be able to turn at least a little profit afterward. It seems to me for him to order something special for you he should really be able to do a better price on it than if you bought it off the lot, and in that respect I can see your point of view. Usually special orders are paid for in advance so he has no actual money out of his pocket spent buying the item and letting it set on the yard for several months waiting on a buyer like he would with other "stocked" items. All he has to cover is the salary of the man selling it to you, especially if you cover setup costs, shipping costs, etc. In that case he's sure to turn a at least a little profit just off the setup charges, so to "stick it to you" on the actual implement cost really isn't right in my opinion. The best way to see how fair his price is is to do some comparison shopping. Call arouind to other dealers and see how their prices compare, that is the only "fair" way to do it. From the buyers point of view I can see your point too about wanting all the information you can get. As a mechanic I spend alot of my customers money buying parts for their equipment. I know of at least one OEM that usually has at least a 150% markup on items and I have seen items marked up nearly 300%. I know this because many of their parts are "off the shelf" items that can usually be bought straight from the mfg. without having to go therough them. In a case like this I know where to go to buy the part alot cheaper than my customer would therefore I can put my markup on the part and still save him a load of cash too. If I'm gonna be the one installing the part the I'm gonna make more profit installing the part than I ever would on the markup, so I always try to cut the customer a deal and lower my normal markup. However if I'm having to buy the part for the customer to put on you can bet I'm gonna raise the markup percentage to at least cover the cost of my time spent ordering and handling the part, plus a little bit, otherwise I'd be working for free. Just my .02

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PWOG

09-14-2004 18:16:32

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Re: Dealer cost on new equipment?. in reply to Jonboy, 09-14-2004 16:03:01

Jonboy--If I'm looking for a particular piece of equip I'll often search "Fastline" prices and the net to see who has what for sale. Forget retail because there are too many variables. The market will say what something is worth and what the general market price is. That's capitalism.
If you are ordering something you are at a disadvantage but it is also a "riskless" transaction for the dealer in that he has a deposit and a known sale. Ask his best price--cash with a deposit--and take or leave it. I don't haggle back and forth. I'd try to find a dealer with one in stock who wants to get rid of it. I don't make an offer until I am sure of my facts and 100% ready to make a deal. I've saved a bundle over the years and helped dealers unload lots of stuff they wanted to get rid of. We both win.
As well I recently bought a tractor from a local dealer for $500 more (but $800 less than they wanted) than someone in the next state because they were local and could fix things if need be. I buy all my parts there and we developed a nice relationship.

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TheRealRon

09-14-2004 18:04:43

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Re: Dealer cost on new equipment?. in reply to Jonboy, 09-14-2004 16:03:01

Wow! Let's see. We have a bunch of business people who responded who don't want you to know how much profit they make. I wonder why!

To answer your question the local equipment dealer who sells the Servis-Rhino marks them up 40% which is pretty standard. For long-term customers he will knock off 15-20% or he can use that margin to take a trade. First time customers pay more but I live in a VERY small town so the "good old boy thing" might be a little different where you are.

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rettchr

09-14-2004 17:44:42

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Re: Dealer cost on new equipment?. in reply to Jonboy, 09-14-2004 16:03:01

Just curious, but what do you say if a customer of yours wants to know your costs before hiring you to mow for them?
I am not a dealer, but also am not a fan of the Consumers Reports approach to car shopping either.

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Jonboy

09-14-2004 18:00:36

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Re: Dealer cost on new equipment?. in reply to rettchr, 09-14-2004 17:44:42

I have been asked that before and basically what I tell them is my hourly rate, take it or leave it. The Rhino dealer may tell me the same thing, but I thought it was worth trying.

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Hi JohnBoy

09-14-2004 17:38:22

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Re: Dealer cost on new equipment?. in reply to Jonboy, 09-14-2004 16:03:01

I am in business to make money. The saying in business is to Never Ever let the help/customer count your money!!! The other post are right. Yes , a businessman/tradesman can make a good dollar if things go right. But , after paying everyone else , he's hoping to have a little left for himself. And if he's lucky , he will make slightly more than his help. On the flip side , if things don't go right , he looses BIG , and looses FAST. I say this because the bank , the insurance company , the utility company , the venders , the help , and most important: the little woman , still want there money. Lots of people think logically , and have it all figured out. Fact is , unless they've been in business , they don't have a clue!!! As others have said , the farm equipment dealer is not making a fortune on your single purchase.

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Honest Injin

09-14-2004 16:58:48

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Re: Dealer cost on new equipment?. in reply to Jonboy, 09-14-2004 16:03:01

Can I come and beat you down in your profit at your job. You are really sick to ask such a thing. Shame on you.

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Nolan

09-15-2004 05:29:12

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Re: Dealer cost on new equipment?. in reply to Honest Injin, 09-14-2004 16:58:48

LOL!
Comission salesmen must *love* you!

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09-14-2004 16:53:59

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Re: Dealer cost on new equipment?. in reply to Jonboy, 09-14-2004 16:03:01

If you feel the GR72 is too hefty of a price, then maybe you should look at another brand. Most of these guys will make about 20% gross profit. On this unit would be $900.00, subtract freight $150.00, setup, another $100.00, He has a salary to pay to the person you are buying it from, the longer it takes for you to decide to buy, the more expense that is involved, let's guess $50.00, that puts his gross profit down to $600.00. Then if you do have a problem with it, you want him to have the parts you need to fix it, more expense. And you want him to discount it a little????? ? How is this man supposed to stay in business if he keeps giving away his profit???

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Jonboy

09-14-2004 17:10:59

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Re: Dealer cost on new equipment?. in reply to JT, 09-14-2004 16:53:59

Actually, he wants me to pay the freight, setup wasn't mentioned, but you are right. If you look at the consumers point of view, every dollar saved would be a dollar less before the brush hog paid for itself. I know a dealer has to make some, but I'm wondering just how much he would be making off this sale. This dealer is a high volume seller on new 3pt equipment and has a couple of consignment auctions every year, so I'd say he gets quite a good income. I had always been told it wasn't the actual sale of the equipment, it was the service parts where they make their money.

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JRM

09-14-2004 19:49:45

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Re: Dealer cost on new equipment?. in reply to Jonboy, 09-14-2004 17:10:59

His good income doesn't mean a thing if its smaller than his expenses. There are 2 sides to the equation, income and expense. You only see one side. As the others have said, run a business for awhile, it will really open your eyes.

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MarkO

09-14-2004 17:49:32

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Re: Dealer cost on new equipment?. in reply to Jonboy, 09-14-2004 17:10:59

Well then check another dealer and compare prices. Don"t matter what his income is. We need to worry about ours! Like all of us, I don"t want to be taken, so I shop (within reason). But I also want that dealer in business in case there is a problem or replacement parts.

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Jonboy

09-14-2004 17:56:33

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Re: Dealer cost on new equipment?. in reply to MarkO, 09-14-2004 17:49:32

Right, and thats why I wanted to know dealers prices because there isn't another Rhino dealer in the area that I know of, and the Rhino website doesn't even list a MSRP, so I have no clue if $4,500 is a good price. It would give me peace of mind knowing, and I thought I might try to get a better deal if it was alittle high. I know the dealer has to make a profit, but I really am not looking for him to take me to the cleaners. Smart Shopping is my method.

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09-15-2004 06:33:46

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Re: Dealer cost on new equipment?. in reply to Jonboy, 09-14-2004 17:56:33

Being you want to lookat it that way, just what kind of profit do you think this man has to make. As I told you, most of the time he will make about 20% gross profit. Maybe 25% if he is a big dealer. If I do not make 20% gross profit when I sell something, I do not sell it. I have to have that percentage to stay in business. Most people do not have a clue what the expenses are to run a business. I run a small business, do not own myn building, I lease it, my insurance, with workman's comp alone cost me almost $6000.00 per year or $21.00 per day. Unless this guy is a crook, he probably is giving you a fair price, from what everyone says, a Rhino is one well built peice of equipment and you cannot expect to get a Lincoln Continental at Yugo prices.

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G-MAN

09-14-2004 16:12:48

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Re: Dealer cost on new equipment?. in reply to Jonboy, 09-14-2004 16:03:01

Ask him. He may or may not tell you. The fact that he has to order it and doesn't have 20 in stock probably should tell you that he isn't getting some screaming volume-based price. And knowing what he pays may not help you dicker. He's probably going to have an absolute bottom-dollar in mind, and may not decided to let you dictate his profit margin.

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Jonboy

09-14-2004 16:42:23

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Re: Dealer cost on new equipment?. in reply to G-MAN, 09-14-2004 16:12:48

He does sell an awful lot of Rhinos though, he usually orders 30 or so each winter for spring, but to special order just 1 he told me the shipping would be up there.

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Halbert

09-14-2004 17:19:07

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Re: Dealer cost on new equipment?. in reply to Jonboy, 09-14-2004 16:42:23

Why don't you wait and save on the freight when he does his big ordering? He can order yours along with everything else.
Plus a dealer should always be able to give you a better price when you leave a deposit and he knows the machine will be in and out the door and not incurring finance charges laying around the floor or lot. It's the same with automobiles and trucks; they don't mind taking orders early in the model year because they know its's already sold with no floor financing.

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Jonboy

09-14-2004 17:25:53

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Re: Dealer cost on new equipment?. in reply to Halbert, 09-14-2004 17:19:07

I'd love to wait, but I've got some land that I wanted to get brushhogged so I could plow and seed it to winter rye (green manure crop) while theres still a couple of months left of the growing season for it. I may hire it done, and it would cost me alot less than paying the extra feight to have that one unit shipped.

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showcrop

09-14-2004 16:24:55

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Re: Dealer cost on new equipment?. in reply to G-MAN, 09-14-2004 16:12:48

jonboy, I've usually been able to get dealers down to cost or ten over by just paying their lights mortgage, and liability insurance for a week, but sometimes inorder to really squeeze them I also pay the medical insurance. Good Luck Showcrop

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