Would you pay extra to have hauling included for "free"?

[Coyote machine]

So do a sliding scale based on mileage from shop. So much for 35 miles or less, 50 miles to 36, etc.
Annual increases per mileage category based on CPI. Refund of 1/2 or 1/3 of total cost to consumer if unused over the entire term of x amount of years. Can be rolled over to next tractor bought/traded for flat fee of $150 if never used on first tractor, or as a credit toward purchase of next tractor minus a fee of $xxx.
Now that type of agreement has to interest some buyers, because it gives then coverage AND other options!:thumbsup:

 

[JD5210]

Twice I had to have warranty work done on my Simplicity lawn tractor. Once the dealer picked it up and returned it at no charge and the other time came out to the house to fix it.

 

[DavesTractor]

Sell the free hauling like an insurance product by looking at past sales, determining the mean average service calls, the cost of those service calls, the total number of miles driven, the average cost per mile (total equipment cost, expected fuel cost, expected insurance cost, employee cost to drive, divided by expected service life gives a mean use cost multiplied by the number of miles or hours to cover the service calls given your operating costs per contract) in a given time period, and aggregate a risk pool. Multiply the mean average by the profit margin you hope to earn, and that number becomes the ask on your sales price while the mean average becomes your cost. At the end of the day: somebody will cost you money but most will earn your shop money. Best of all, the customer gives you money upfront for the service, which means that you can assign a portion of that money in an interest bearing account and earn even more.

This is what we are considering. And maybe expand it to include 50 hour and 100 hour services. As long as it was optional, people can say "no thanks".

 

[DavesTractor]

So do a sliding scale based on mileage from shop. So much for 35 miles or less, 50 miles to 36, etc.
Annual increases per mileage category based on CPI. Refund of 1/2 or 1/3 of total cost to consumer if unused over the entire term of x amount of years. Can be rolled over to next tractor bought/traded for flat fee of $150 if never used on first tractor, or as a credit toward purchase of next tractor minus a fee of $xxx.
Now that type of agreement has to interest some buyers, because it gives then coverage AND other options!:thumbsup:

We may have a winner here. :thumbsup:

 

[MinnesotaEric]

This is what we are considering. And maybe expand it to include 50 hour and 100 hour services. As long as it was optional, people can say "no thanks".

Except fix my calculations because I'm dividing when it should be multiplying--at any-rate, you know what I mean. I would develop and constantly update as you receive new information two different schedules: one for the pick-up and one for maintenance. Maintenance wise, you're pulling forward (at a discount to the customer) maintenance but you're also locking in your shop as the provider of that service and , again you're getting paid up-front. Anyway, my suggestion is to sell it as two different products to cast as wide of a net as possible to gather more sales of those products. Why? Some people have a trailer, but may be too busy to fiddle with routine maintenance, or are interested in having somebody else do it at what would have been their cost. Now you're value-adding to the sale potential options.

Internally, you should set up some kind of interest-bearing "trust" account (it needn't be a real trust account, but one you use as a trust account) to cover expenses (in traditional CYA fashion) whether you set this up in your general ledger or a separate savings account at the bank.

 

[Gator6x4]

We may have a winner here. :thumbsup:

The Green Dealer I deal with has a flat fee of $100.00 to pick the unit up and bring it back, if you purchased the unit from him. Some have really got upset at him because he will not extend the same service commitment to them, even though they purchased the unit somewhere else, using the argument warranty repairs should be the same regardless of place of purchase as justification.

 

[Capricious]

We may have a winner here. :thumbsup:

What are you going to say to the guy who is 35.3 miles from the shop? Or 50.3 miles, and so forth.

Looks too complicated to me.

 

[bcp]

A local gravel dealer has free delivery within 10 miles, but if you live 11 miles away, you pay for a 22 mile round trip, not 2 miles. That doesn't feel right to me.

Bruce

 

[Piston]

Amazing how many replies so far, we must all be busy at "work" today :laughing:

You could advertise "free" pickup and delivery, but for people who don't want that option, offer the warrentee at a discounted rate. This is how Everything Attachments does it, and they are very successful. They advertise everything as free shipping, but if your local or want to pick the item up yourself, you get a discount since your not paying for shipping.

 

[Capricious]

Or what if the truck can drop off one tractor & pick up another on the same run? Who gets charged for that?

Can (will) the drivers log all these moves in sufficient detail so the back office people can track it? Do the back-office people have the time to track it?

I like simple. Simple sells. A local new car dealer here advertises used cars by saying, "if it's not right, we will make it right. Free." * I am sure he has had to eat "the big one" on a few repairs but it brings in the business. And it doesn't read like the fine print on an insurance contract.



EDITED TO ADD: I am not suggesting you haul for free; I am suggesting you keep the policy simple.



*although they say they will make it right for free, they DON't say they will pick it up with their truck for free.