Two stores under one roof: can it work? – September 25, 2006
September 25, 2006
Filed under Features
In rural Vermont, many businesses depend on stocking multiple lines of goods that cater to diverse customer populations to survive, as Brown Enterprises Inc. in South Londonderry can attest.
From its start in 1987, the company has rented and sold construction and outdoor power equipment, as well as selling and servicing ATVs and snowmobiles, lawn and garden equipment, compact tractors, high-reach forklifts and other equipment. Brown Enterprises also stocks two lines of work apparel, says Steven Brown, company vice president and son of founder Larry Brown.
The company began as a rental business when the elder Brown discovered the construction equipment he owned wasn’t being used all the time. So Brown Enterprises quickly started selling powersports equipment and lawn and garden equipment to diversify the company and bring in repair work.
Mixing powersports equipment with lawn mowers and other outdoor products won’t work for everyone, but Brown Enterprises has found success in this unusual niche.
The rental business occupies a 2,000-square-foot building adjacent to the main 11,000-square-foot sales and service center in this rural area of south-central Vermont. County population is 44,000, so offering a variety of products keeps the staff of just more than 30 employees busy year-round. Brown Enterprises also has a satellite store in Manchester, Vt. The rental business comprises 25 percent of sales, followed by powersports sales and service at between 20-25 percent, with the remainder divided among the other categories.
Brown Enterprises carries ATVs and snowmobiles from Arctic Cat, go-karts from Carter Brothers and lawn and garden equipment from Husqvarna, Stihl, Exmark Manufacturing, Simplicity Manufacturing and DR Power Equipment. It also stocks Massey-Ferguson compact tractors, skid steers, compact excavators and high-reach forklifts from Gehl Co., stump grinders and chippers from Rayco Manufacturing, work apparel from Carhartt and work shoes from Red Wing. “In the beginning, we needed every piece of the puzzle to survive,” says Steven Brown. “Powersports keeps technicians and staff busy in the winter.”
The hardest part of running such a diverse business, Brown says, is routing the repair work to the right technician. Only one of the technicians is considered a jack of all trades, but everyone partakes in training courses to keep skills sharp, and the service manager divides up the work according to the strengths of each technician.
Personally, Brown says that shifting gears among so many business areas can be a challenge. “From a management position, you have to be well-versed in a lot of things,” Brown says. “You’re backing up a department one minute and traveling to a job site the next to check on a piece of broken equipment.”
Employees are divided by department to take care of customers, who travel to Brown Equipment within a 40-mile radius for most items, 80 or 90 miles to buy larger equipment. “I think this might only be successful if you’re in a rural area,” Brown says. “Out here, you have to be all things to all people.”
Like Brown Enterprises, when The Engelhart Center opened in Madison, Wisc., in 1972, “the start-up dealer needed all the sales it could get,” says Robert Hintz, general manager. So powersports and lawn and garden were sold and serviced side by side until 2004, when the lawn and garden business was relocated to an adjacent building and that business was renamed Engelhart Greensmith.
“It’s tough to carry both lines,” Hintz says. “Can they co-exist under one roof? Yes. But whether you can do both well is another question.”
In years past, several other dealers have tried to make the powersports/lawn and garden mix work, but Hintz says he doesn’t know of any other dealers with this product lineup.
At 35,000 square feet, The Engelhart Center has plenty of room to carry snowmobiles from Arctic Cat and full product lineups from Honda, Yamaha, Suzuki and Bombardier Recreational Products, with room left over for used equipment and a service center that features a drive-through service area. Engelhart Greensmith features a 10,000-square-foot facility with drive-through service area and products from Toro, Simplicity Manufacturing, Honda Power, Husqvarna, Sthil, Lawn-Boy, Snapper, Wright Manufacturing and RedMax.
“We split the business because we didn’t feel we were giving the lawn and garden customers the red carpet treatment that they deserved,” Hintz says. It was not uncommon to see a customer with a lawn mower cable in his hand next to someone buying a motorcycle helmet. While lawn and garden customers are location-specific, often seeking out the closest dealer, powersports enthusiasts visit the store from within a 40-mile radius of Madison, Hintz says.
Hintz calls the move a leap of faith, because the lawn and garden business represented $1.5 million in annual sales, and constructing a new building on land the company owned represented a $1 million investment. So far, the reviews are mixed.
“The service business picked right up,” Hintz says of the powersports side. “The service department gained time to write business. Lawn and garden hasn’t grown like we wanted. Service and parts have grown, but the sales side hasn’t.” Shortly after Engelhart Greensmith started as a separate company, a Home Depot opened within a mile of the dealership, which certainly impacted sales of lawn and garden equipment.
While the company shares a receptionist and back-office functions, a parts manager, service manager and set-up person were hired on the lawn and garden side, increasing the company’s overhead. “Sales are up, but expenses have exceeded the sales growth,” Hintz says.
Still, Hintz has a three-year plan to get the business on track, and he’s sticking to it. Should the lawn and garden business fail as a separate entity, Hintz has a contingency plan for the building, adapting it for use in the main business.
Regardless of whether the split ultimately will prove successful, Hintz says it was the right decision to make. “You need excellent customer service to grow any business, and we didn’t think we were serving our customers in the best way possible,” Hintz says, “so we’re giving this a shot.” psb