Buying at the factory

[jrambo316]

Anyone have experience buying direct from the factory? For example, if one were interested in one of the Tartan boats, he could buy at a dealer somewhere or take delivery in Ohio at the factory I presume. I would think a dealer would have delivery, sales commission, overhead, and commissioning added to price where as at the factory there would not be delivery, dealer overhead, or sales commission costs. Is that a common practice or do the builders charge the same as dealers so as not to anger them? I would think cutting at least the delivery cost would be a no brainer.

[Stu Jackson]

Have you considered asking the builder, by phone or email? They'd know better than we would, unless someone here has already "been there-done that."

[jrambo316]

Originally Posted by Stu Jackson

unless someone here has already "been there-done that."

That is what I was looking for. I have a few years to go until the kids head off to school and am still in research phase. Builder probably would not waste time. I tried to contact Lyman Morse that way last summer because I hoped to tour the facilities while in Maine but they never responded.

[Tar34]

Originally Posted by jrambo316

Anyone have experience buying direct from the factory? For example, if one were interested in one of the Tartan boats, he could buy at a dealer somewhere or take delivery in Ohio at the factory I presume. I would think a dealer would have delivery, sales commission, overhead, and commissioning added to price where as at the factory there would not be delivery, dealer overhead, or sales commission costs. Is that a common practice or do the builders charge the same as dealers so as not to anger them? I would think cutting at least the delivery cost would be a no brainer.

Dealer agreements would prevent you from going around the dealer network. Negotiate a deal with the dealer for your area. Perhaps then you can carve out shipping costs by taking delivery at the factory. I would not advise this though. Dealers typically prep boats after delivery such as sanding the gelcoat prior to application of bottom paint. If you have any problems with the boat after delivery, you have someone to lean on. Not so if you take factory direct. You will accept part of the liability if something goes amiss.

[jrambo316]

Originally Posted by Tar34

Dealer agreements would prevent you from going around the dealer network. Negotiate a deal with the dealer for your area. Perhaps then you can carve out shipping costs by taking delivery at the factory. I would not advise this though. Dealers typically prep boats after delivery such as sanding the gelcoat prior to application of bottom paint. If you have any problems with the boat after delivery, you have someone to lean on. Not so if you take factory direct. You will accept part of the liability if something goes amiss.

Thanks, I suspected that. For the example I mentioned, Tartan itself is listed as a dealer in Ohio at the factory. I assume they would do all the things other dealers would. Perhaps they would have more room to negotiate.

[hellosailor]

rambo, you're gonna buy a boat based on who can sell it to you semi-wholesale, not based on what the boat is?

And you're looking for something several years down the line, at a time when boat builders may well follow Hunter's example and go bankrupt before those few years go by?

I'd suggest you've put a cart firmly before a mythological horse. Figure out WHAT you want to buy and then WHEN you are ready to actually buy it, go see if it can be bought.

Meanwhile, go boating.

[markpierce]

Bought my Coot directly from the factory. Got a better price than from a dealer, but assume I paid a higher price than the factory sells to dealers. ... I imagine that many/most builders won't sell direct in order to protect the businesses of its dealers.

Thus, saved some from the dealer's markup, but had to arrange shipment from China to California and customs clearance directly. Another factor: the closest dealer was in Seattle, so there would have been shipping charges from Seattle to San Francisco.

In my case, it was a delight to deal directly with the builder concerning options and customization (paint scheme, helmsman's panel layout, installation of buyer-supplied air-horn system, and so on).

[jrambo316]

Originally Posted by hellosailor

rambo, you're gonna buy a boat based on who can sell it to you semi-wholesale, not based on what the boat is?

And you're looking for something several years down the line, at a time when boat builders may well follow Hunter's example and go bankrupt before those few years go by?

I'd suggest you've put a cart firmly before a mythological horse. Figure out WHAT you want to buy and then WHEN you are ready to actually buy it, go see if it can be bought.

Meanwhile, go boating.

Just gathering information. In fact, I have researched hundreds of boats. My point is that once you have decided on a boat (if it was a new purchase) and the factory location was on your sailing list anyway, why not just buy it there if better deal?

[BertaRobinz]

I there there should be a fair scheme of delivery without any additional extra charges, but during one of my transactions these were not mentioned. And they say we don't read the terms and conditions.

[keepondancin]

If a builder has a dealer system, they probably won't sell direct. Customers are to big a pain in the butt. They take time, have a never ending list of questions, become demanding, and in most cases, need there hand held for quite a period of time after taking ownership. All this takes time, and time is money. The dealer get's paid for his time. His costs go on 24 hours a day, even if he has no customers, and that cost has to be amortized. If the builder is selling direct, and he expects to stay in business, he has to have staff just to handle customers, and needs to have that cost covered, and if he doesn't have dedicated staff, he is taking time away from producing a boat, which is an expense.

[Rocketman]

Jrambo, it sounds like you are seeing the light at the end of the tunnel and are just now getting excited about finally being able to realize a dream. Good for you. If your dream of boat ownership is owning a New Boat, then some of the very best deals that you can get are at the boat show's. A friend of mine wanted a 35ft Hunter, he went to the Annapolis Boat show, and on the last day of the show made a rediculas offer on there brand new 2 year old boat. He sailed it home. I am not saying this can be done everytime, and again it depends on how baddly the dealer, wants to unload the asset/liablity. He saved about 50 grand off of the already discounted price.

[hellosailor]

"a rediculas offer on there brand new 2 year old boat."
Obviously not all ridiculous if the dealer took the offer.<G>
You've got to figure that once the boat became more than a year old, the value dropped. The loan value dropped, making financing a problem. Then it dropped again when the boat became two years old. So now the boat is no longer worth what it was new, buyers can have trouble financing or insuring it, there are fewer buyers for it, and even worse, the dealer is still paying finance charges, inventory insurance, maintenance, on the boat every month.
Depending on the timeframe, if the dealer was paying 6-10% "floor" charges to finance his invoentory? He might have already paid out 15% above what the boat cost him in finance charges! Good reason to sell it, fast.

[S/V Illusion]

Originally Posted by jrambo316

My point is that once you have decided on a boat (if it was a new purchase) and the factory location was on your sailing list anyway, why not just buy it there if better deal?

What makes you think you have a novel idea here? Boaters are cheap and none of us would pay 'extra' if we could avoid it by eliminating middlemen.

As other have said, builders have dealer agreements just as in most other industries, automobiles being one. Unless you are planning to buy a fleet of boats that is.

[sailpower]

Originally Posted by jrambo316

Just gathering information. In fact, I have researched hundreds of boats. My point is that once you have decided on a boat (if it was a new purchase) and the factory location was on your sailing list anyway, why not just buy it there if better deal?

I doubt you will find a factory willing to sabotage a dealer who represents a steady source of sales and service for a one time sale from someone looking for a deal.

Keep in mind that the factories are not set up for service. In your example would you be willing to ship your Tartan back to OH for warranty work? Looking at the total picture a onetime initial savings even if you could get it probably wouldn’t be much of a benefit.

As long as dealers keep ordering boats for stock I doubt you will see much change in the marketing model.

RE the two year old Hunter: A boat in dealer inventory for two years will most likely have curtailment payments as well as finance charges.

Curtailment is mandatory periodic paydown of a portion of the principal. If the dealer was facing another one of those then he will have even more incentive to sell.

Most likely the factory covered the shortfall in exchange for another stock boat order. These situations can be a great opportunity for a buyer ready to buy.

[hellosailor]

Illusion, doesn't Hinckley have a "Day Old" factory outlet store? You know, for direct sales of the day-old expired boats they've taken back off the shelf at dealerships?

Oh, wait, no, maybe I'm thinking of WonderBread.<G>