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The Strato and EuroTech may share the same cab design—but can they be sold successfully by the same dealer? Terry Waterfall, managing director of Sherwood Motor Holdings which holds franchises for both, has no doubts that they can live happily side-by-side.
Sherwood operates Iveco Ford heavy truck specialist dealerships in Sheffield and Blackwell in Derbyshire, as well as the Seddon Atkinson franchise in Nottingham. Until last February it was the largest independent Leyland Daf dealership in Britain. Then came receivership at LD.
Having held one third of the South Yorkshire and Nottinghamshire truck markets Waterfall was doubtful about the long-term future of the soon.to.be reborn Anglo-Dutch manufacturer, not least when it came to maintaining Sherwood's sales volumes.
"We were taking around a 35% market share in the two territories, which last year worked out at about 500 chassis. I had to look at something that would give us those volumes. I couldn't see Daf coming back as a company the way we knew it. We'd geared this company up to a level of vehicle sales and service and I felt it was probably time to discuss with other manufacturers where we go next."
Sherwood was eventually drawn to Iveco Ford, partly as its product range mirrored much of the Leyland Daf line-up, After preliminary talks with [FT at Watford, Waterfall took a trip to Turin to meet Iveco boss Giancarlo Boschetti.
"When I sat with him and listened to their ambitions for the UK market and their investment in new products it convinced me they could give us a more secure future."
On 1 May Blackwell opened its doors as an Iveco Ford heavy truck specialist dealer, followed a month later by Sheffield. And last December Sherwood's Seddon Atkinson dealership began operating at Nottingham having taken over from Marriott Brothers.
As Sherwood's salesmen would have to sell against each other how do you maximise the dual franchise potential?
The key lies in the distinct difference between a Strato customer and a EuroTech buyer, according to Waterfall: "Without doubt there are still a number of people who like to buy British. The Strato buyer is very much a traditional man who loves his Cummins engines and straightforward drivelines—"British drivelines" if you like and who are in general haulage.
"The EuroTech buyer has already committed himself to an integrated driveline, He's the typical Daf or Volvo type of customer. We've done very well with EuroTech. We're selling it across the board to operators who like integrated drivelines."
That powertrain choice can be a positive force, says Waterfall, who also sees a difference in the manufacturers his two marques are competing against.
"If you're going in with EuroTech you're going in against Mercedes-Benz, Volvo and Leyland Daf. With Seddon Atkinson you're going in against ERF and Foden."
Despite those different target markets Waterfall accepts that there will be times when salesmen from within the group could be fighting for the same deal.
"It's got to be centrally controlled otherwise you'll get that conflict. Our sales director Neil Renshaw keeps a close eye on deals of that nature—so we're fed information from within as to who's dealing with what at any one time.
"We've already had a couple of conflicts but it's been sensibly managed and we've not run into the situation where we've both nosedived."
But supposing a salesman from the Iveco Ford Blackwell dealership got wind of a big fleet deal in the offing and was unwittingly played off against his counterpart from the Seddon franchise at Nottingham by a canny operator? Waterfall is adamant that even if that happened common sense would prevail: "Well obviously we're not going to wind it down ourselves. And the other thing is that personal preference is quite strong, it's not all price is it?
"I'm not saying it's not going to happen but the majority of customers are not going to sit down and say 'let's look at a Strato and a EuroTech and compare specs and run with one or the other once we've sorted the price out'. In the main it won't happen."
Iveco Ford is the dominant partner within the Iveco UK Group, so how would Waterfall respond if a major customer took a demonstrator from his Seddon and IFT dealerships and then said the Strato did better? The answer is short, sharp and logical: "We'd sell him the Strato." But wouldn't that have a bad effect on the Iveco Ford dealer sales team?
"You win some and lose some. That's down to us to keep them motivated. But you'll get another operator and he'll say I like the fuel consumption of the 340 EuroTech, or the drivers' prefer it—it's all swings and roundabouts. It's already happened. We sold four Seddon Atkinsons down the road where we were trying to sell them Ivecos—but it was an existing Seddon fleet, so it's no good the salesman's head going down."
Good communication between the sales teams will turn this potential minefield of customer choice into a winning advantage, believes Waterfall: "The one thing we do as a company is make people talk to each other. If a customer says take the Strato away I want a EuroTech, or vice versa, then the salesman can call his counterpart and say you'd better get over there quick and see what you can do."
Waterfall doubts whether he'll need to be the final arbitrator in a dispute between his own salesmen: "I can't tell the customer what's he's going to buy. At the end of the day he'll buy what he wants, so the judgement of Solomon is not going to come from me—I won't bang heads together and say stop buggering about. All I'll do is control the pricing and that will be done in terms of profitability."
Given the potential for running with the two marques Waterfall wants to see Seddon Atkinson's tractor range remaining as part of the overall UK Iveco Group product lineup, despite the pressures that must exist for Iveco Ford to sell as many EuroTechs as it can. "It sits nicely on the side of the Iveco Ford range because it's a typically British machine."
Another advantage of the Seddon franchise is the strong municipal presence it offers Sherwood which previously enjoyed success with local authorities with the Freighter. Despite taking on the dual franchise Waterfall doesn't see the practice spreading beyond those Iveco Ford dealers with more than one outlet (see below). And Iveco Ford prefers, wherever possible, not to have Iveco Ford and Seddon franchises on the same site.
"I can't see it spreading to many single site IFT/SA franchises", he says. "The only thing that would drive them into that would be if the market stayed at 35,000 machines a year. They're forecasting a 40,000-plus market and I reckon we'll be looking at 500 Iveco Fords across the range and 100 Seddon Atkinsons. That could be a bit optimistic— we're back to where we were after the trouble with Leyland Daf, and the Seddon Atkinson is a little bit unknown to us. It has 4% in the 15 tonnes and over heavy truck market and we'd hope to do better than that.„or there will be some questions asked in high places." E by Brian Weatherley