Dealer Thinking of taking on a FarmPro dealership am I crazy?

[abcrepair]

Hello,
I am new to this forum today, I am not sure if I am in the right place.
I have been operating a machinery repair shop for 5 years now. It is called Abcrepair that stands for Anything But Cars. I always have work but my son is returning from the service and he wants to work with me so I am looking to take on a short line of equipment. The guys at farmpro have been trying to make me a dealer for few years now. They have a full line of tractors and construction equipment. I am not a big fan of imports but it would be impossible to get a dealership for an American built tractor.
I have looked around this site and don't see too much on FarmPro. some of my concerns are the quailty of the product, product support (parts) and the fact that the equipment is made overseas - the value of the US dollar and trade restrictions and how that will affect the cost of the product.
Any comments or advice would be great
Thanks Ed

 

[radman1]

How many other CUT dealers are in your area? Does you shop has the equipment and expertise to do the repairs? Can you afford to have inventory for parts and repairs on hand?
I think getting into CUT sales and equipment at this time is a very bad idea. The CUT market has overall been in a downturn this whole year for most dealers (some exceptions) and sales for most of the companies is down by double digits. The current financial crisis is going to make it much worse. When every company has been offering 0% financing to boost sales, it is not good. With the current financial crisis, I expect the credit to tighten up with less qualified buyers and maybe a increase in the finance rate. IMHO, don't do it.

 

[greg_g]

Probably not to anyone's surprise, I respectfully disagree. I believe there is a fair sized niche market for these Chinese tractors. In that niche are potential buyers that have never owned a tractor before - and are scared off by the grossly inflated prices of mainstream utility tractors. I even know a few "real" farmers who own them, if for no reason other than curiosity. The main attraction is the comparatively low initial investment, followed by the fact that they're built upon basic 50s and 60s technology. Short version; easy to work on - and parts are cheap.

FarmPro is actually the largest importer of Chinese tractors in America. You might know them better as Homier - the traveling hardware store people. They have a complete line of parts for everything they import.

Understand though, that FarmPro is nothing but a decal that Homier slaps on their tractors and equipment. It's called re-badging. Other dealers sell the same stuff under their own badging - as well as under the original Chinese names; Jinma and Foton. So you're not limited to dealing with Homier. There's nothing stopping you from striking up a deal with any of the member dealers here as well.

//greg//

 

[blueriver]

People have started business for years under a number of circumstances. If you have the ability to do you and believe you can do it ... THEN DO IT!!!!

 

[Diamondpilot]

As stated before most of the FarmPro tractors are Jinma's and a few are Foton's. If you do your research you will find that Chinese tractors are by far the most bang for your buck, are tough as nails, and will most always out perform a similar HP American made tractor.

By the way, there is no such thing as American made Tractors anymore in the CUT game. Almost everything from CASE, JD, NEW HOLLAND is imported. I would guess the most American made tractor these days is the Kubota.

Its just like the 2007 pickup survey USA Today did last winter. They took into account where the parts were made, where the were assembled and it boiled down to this. Toyota#1 Ford#2 Nissan#3 GM#4 Dodge#5

Chris

 

[Bird]

You might know them better as Homier - the traveling hardware store people.

I actually got some things from Homier that weren't too bad, but overall . . . . caveat emptor.

 

[radman1]

Gentlemen, I am all for taking some risks but he needs to understand his market area. Us telling him yes or no from a distance is difficult. Just based on the current financial environment, a new start up from scratch in a business which the OP has no experience is IMO, very risky. No point in risking his other business without some significant thought. I am not afraid of risks and I am in the process of starting another business with 2.3 million in just start up costs with another partner.

 

[blueriver]

Gentlemen, I am all for taking some risks but he needs to understand his market area. Us telling him yes or no from a distance is difficult. Just based on the current financial environment, a new start up from scratch in a business which the OP has no experience is IMO, very risky. No point in risking his other business without some significant thought. I am not afraid of risks and I am in the process of starting another business with 2.3 million in just start up costs with another partner.

I don't believe he is asking for a yes or a no ... if he is thinking about business and has a business then he has business sense ... I believe he is asking more about the line he is thinking about carrying, I know nothing about those tractors, hence I did not comment on that part of it.

 

[rvaitor]

Hello,

Any comments or advice would be great
Thanks Ed

I would aim a little higher. No matter what you take on you need to ensure you have the working capital to fund the operation.

Talk to all the different lines and see what they have to offer.

 

[radman1]

I don't believe he is asking for a yes or a no ... if he is thinking about business and has a business then he has business sense ... I believe he is asking more about the line he is thinking about carrying, I know nothing about those tractors, hence I did not comment on that part of it.

I did not specifically mention any one particular brand. I don't think brand is a significant factor. I don't know of any CUT brand that is having a good year and in particular with the additional down turn in the economy. Even companies starting a new line like Bobcat did with the rebadged Kioti's are not going to do well.

I had several different stock advisors tell me in Sept/Oct that it was time to buy because of the bargains to be purchased. Did I buy? No way. I bought nearly 0 stocks this year. Even at the beginning of the year the volitility was starting. I think the time to buy will occur again. Lots of good established companies (ones not involved in lending) still out there doing ok, if the market can stabilize. Too many people singing about the doom and gloom at this time. It amazes me how much the media can hype the bad. Don't here them talk too much about gas being the cheapest it has been in over 4-5 years but they talked about it nonstop a few months ago.