Discussion:
Big Companies subsidizing labor and lifts

I have to ask if this is just something in Canada, or all over. I'm talking about big lift Companies getting bigger market share by subsidizing...offering their machines at or below cost to buyers, then giving low cost service over time. My salesman tells me that during a conference in the USA, other dealers were shocked to learn about the practice here in Canada. My previous RED employer did give away hundreds of lifts below cost, shutting out any competitor. Then, offered service agreements that were $50 an hour lower than anyone else. I would be sent 2 hrs down highway to do a.7 of an hour maintenance, and not charge anything else. No other small dealerships can compete. Some big companies here want to flex their muscles and be #1 in world wide industrial truck stats. And then there is the pay offs...customers getting bonuses from big companies to get contracts. Is this normal in the rest of the world?
  • Posted 14 Dec 2018 23:39
  • Discussion started by EasiTek
  • Ontario, Canada
Showing items 1 - 5 of 5 results.
Wiggy, you have it right, Here in Texas it drives the techs crazy, and customers to try and go around the system. There are ways to bill things out and some customer management know ways around the system that are not only really creative but ends up being cost effective in the long run. Age and treachery beats em all every time.
  • Posted 20 Dec 2018 22:16
  • Reply by triumphrider
  • Texas, United States
Really common practice here in the UK, especially with big sites where a contract is going to be 20 trucks. They will happily put the machines in at a loss to get a foot in the door and try to rely on a high residual value on the machines at the end of the contract to make the money back (normally ends badly due to abusive drivers/high hours).

It's been going on for 20-30 years and is in my opinion very short sighted practice. Here it has completely knocked the profit out of renting as they have all collectively spent too many years running around cutting each others throats instead of maintaining a 'fair' market price which benefits all, i.e the forklift companies make a healthy profit meaning there's money around to deliver a better service to the end user to keep them happier, and potentially higher wages for engineers which would keep us happier and hopefully attract some new skilled talent to the industry.

It's bonkers when I can rent £15k forklift for £80-95 (£100 short term) a week but if I go to a tool hire shop I'll pay £50 a week to hire an SDS Max hammer drill which I can buy new for £500.

I also do LOTS of work for other lift companies who have long distance contracts and it is frustrating, you can't do your proper job because the other forklift company won't pay the bill and the customers generally unhappy because you can't fix his small issues there an then.
As triumphrider said all you can do is explain its out of your control, it isn't your customer at the end of the day, and other forktruck companies are the WORST customers to do work for in my experience! They don't miss a trick ;)
  • Posted 20 Dec 2018 20:43
  • Reply by wiggy
  • kent, United Kingdom
Yes , As far as looking bad ,there are times when you need to advise the customer there are things totally out of your control. The big orange and black in this area went to customers and managed to get contracts for maintence. They still have to contact the dealers on non Orange and red equipment to clear codes and trouble shooting. The feed back I get from techs is the customer gets stuck a lot of times with down equipment and they get mad at the techs. Sounds like Your management needs to drop them like a hot rock.
  • Posted 17 Dec 2018 22:40
  • Reply by triumphrider
  • Texas, United States
Yeah, there is also territory crossover, where a lift company from 1000 miles away gets contract, then sublets PM to any other lift company. Again, no mileage or extras...they just pay 1 hour, and you cant add anything else. Customer gets frustrated that you wont fix extras, and makes you look bad. Are sublets repairs common too?
  • Posted 15 Dec 2018 11:39
  • Reply by EasiTek
  • Ontario, Canada
Easi , It happens a lot more than you would think. What I cannot figure out is how the big lift companies make any money to off set this practice, When I worked for the beige painted forklift company I would drive about 2 hrs customer do a 1 hour pm only to be sent back the next month to do the same thing on another lift or pallett jack. No matter how much I could not get them to put all 10 units on one PM list so they could be done in one trip. Full maintence units on top of that. Go figure.
  • Posted 15 Dec 2018 01:53
  • Reply by triumphrider
  • Texas, United States

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