The family knows snow
Sep 1, 2006 12:00 PM
BUSINESS at Kooy Brothers is growing so fast that the Kooy family can't keep up.
Sixteen people who are not related to anyone in the Kooy family now work for the Toronto-based company — barely outnumbering the 14 employees who are members of the Kooy family. As the company has grown, it has added brothers, sisters, nieces, nephews, cousins, Mom, and in-laws. But it welcomes those who aren't relatives, too.
“We treat everyone here like family,” says Bill Kooy, president.
When it comes to selling and servicing snow and ice control equipment, management has expanded outside its own walls. The little company that started in the family garage now has its network of sub-dealers and its finance company to help sell snow and ice equipment throughout Canada's most populous province.
When the weather is warm and the sun is shining, Kooy Brothers is one of Ontario's largest retailers of lawn and garden equipment. But as the weather changes, so does the product mix.
The company's yard and showroom were still in full lawn and garden equipment mode in mid August, but that was changing behind the scene, with shipments of snowplows and spreaders arriving and plans being made for the company's annual meeting of the network of sub-dealers who help the company sell snow and ice control equipment throughout Ontario.
“There's not a month that goes by that we don't install a snowplow or spreader,” Kooy says.
But September is a big month for Kooy's winter product lines. Not only is the company gearing up for the season, but it is helping its network of sub-dealers do the same.
The highlight of the month is the company's annual open house, in which Kooy Brothers conducts training sessions for its growing sales and service network. The sessions include topics such as product service and warranty issues.
“The better we educate our sub-dealers, the better the warranty system works,” Kooy says. “As the primary distributor, we are the liaison between the manufacturer and our sub-dealers. We need to be clear about what the manufacturer's expectations are, because we are the ones who have to interpret the OEM's warranty. That can be tough, especially when it's obvious that the customer abused the product or when the warranty only recently expired. That's why we make it mandatory that our sub-dealers attend our dealer meetings once a year.”
Kooy Brothers has a network of 10 sub-dealers throughout Ontario, but management hopes to add as many as eight more this year. The reason — convenience for the customer. Kooy wants Ontario customers to be able to get service by driving 20 minutes or less.
“The pressure is really on contractors — especially here in Toronto where the pace is fast and people have places to go,” Kooy says. “It's not like lawn maintenance when equipment breaks down and the grass grows a millimeter taller. People expect snow and ice to be removed. There are no excuses. And that has implications for us. Because of the pressure our customers are under, we need to be able to serve them quickly and conveniently. We can do that through a network of sub-dealers.”
To set up its sub-dealers, Kooy visited a lot of prospective companies.
“Having dealers is an eye-opener,” Kooy says. “It has given us a new perspective on how we do things here. We saw some things that other companies found acceptable that we didn't think should be. I kept asking myself ‘Do I want to do business with someone if I have to step over his dog? Will a customer really want to trust this company with a $60,000 truck?’ When we came back to our own place and took a look around, we made some changes. For example, it's a constant job keeping this place clean, especially during snowstorms when people track in salt all over the place. But looking at prospective sub-dealers reminded us that good housekeeping is good business. If you do business as a professional, suddenly price is not as much of a factor.
“Now if someone asks for my best price, I tell them ‘$100 more than I just quoted you.’ They usually respond by asking ‘How can that be your best price?’ I remind them that they asked for my best price. My best price isn't the same as their best price. That usually puts an end to the price conversation.”
Kooy Brothers requires that the sub-dealer be professional, buy a minimum of 10 plows per year, and to remain in business.
“There's a big trend in this industry to download the responsibility down the channel,” Kooy says. “Manufacturers want more product stocked at the dealer level. Yet I could put a sub-dealer out of business by demanding that he stock too much. I have a responsibility to preserve the business of my sub-dealers. No one talks much about the moral side of these relationships, which is something that sets us apart.”
Importance of finance
Kooy Brothers operates in a large, multicultural market where not everyone speaks the same language in a city where, by Kooy's estimation, there are 120 different nationalities. Selling snowplows can be challenging. Nowhere is the language barrier more acute than when it comes time to pay for the purchase. That's where Providential Financial, the company's in-house financing company, comes in.
“My dad was in the piano business,” Kooy says. “He used to say when you sell a piano, follow the customer home. If you don't, he will talk himself out of buying it. The same holds true for financing the sale of snowplows. By having our own finance company, we can get customers fast answers on whether or not they can get financing. We decide right away if the customer is an acceptable credit risk.”
Approximately 90% of Kooy Brothers sales are financed, including many to customers with less than perfect credit histories.
“We have a lot of landscapers in the Toronto area who don't speak English,” Kooy says. “Financing a deal for them can be a humiliating experience — especially if you can't speak the language. We've tried to make the process as simple as possible — just fill in the blanks. All the customer has to do is sign and give us a check.”
Once the sale is made, the Kooy Brothers salesman introduces the customer to the Providential's finance manager. Separating the sale and the financing proves beneficial, Kooy says.
“People frequently want to present themselves as being a little more than what they are,” Kooy says. “That may be okay when you are negotiating with a salesman, but it's not okay when you are presenting yourself to the finance guy. By having another person handling the financial portion of the sale, the customer does not have to financially undress in front of his salesman. We help our customers save face, which is something they appreciate.”
More money available
Kooy Brothers also offers financing to its sub-dealers. But unlike the financing its customers receive from Providential, the sub-dealer financing comes from a third party.
General Electric's financial services operation helps Kooy Brothers sub-dealers fund their purchases of snow and ice control equipment.
“They take the plows, we provide the shipping, and GE provides the floorplan,” Kooy says. “We also offer early-order cash discounts.”
The floorplan Kooy Brothers offers sub-dealers includes a three-check program in which payments are due October 15, November 15 and December 15.
With finance serving as a useful tool for selling snow and ice control equipment, Kooy Brothers' finance manager spent part of August teaching the company's sub-dealers how to sell financial services.
“Some people will say, ‘Hey, this is complicated’,” Kooy says. “But we tell them that we will hold their hand through the process. We will even fill out the documents for them. It has to be simple. That's the only way to get people to change the way they do business.”
Bill and Harry Kooy started Kooy Brothers in 1983 at home. Business grew, and they needed to hire their brother Len. The brothers soon rented a facility and incorporated in 1985.
Prior to starting their business, the brothers were in the music business.
“We made music for 40 years,” Bill Kooy says. “Our dad was our band director, and he consistently scheduled band practice for us on Friday nights — which was tough on us as teenagers. We had to go out on Mondays, because we had practices and concerts during the weekend. Even now, my wife and I go out on Monday nights just out of habit. But the music business was good training for us. I guess that's where our concept of teamwork originated.”
Teamwork is a key concept in a major city such as Toronto, where multiple nationalities thrive and hundreds of thousands of motorists share roads that must be kept clear of snow and ice.
“My kids sometimes complain about the traffic here,” Kooy says. “Yeah, you can look at all those cars and see traffic. I prefer to look at them and see potential customers.”
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