Go BottomOpening a Kioti Dealership
 | Jeff
Join Date: Posts: 1 
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2006-04-01 127004
I'm in the early stages of opening a Kioti dealership (mostly paperwork at this point) but wanted to know if anyone knows if the lawsuit between Kioti and Kubota has been settled? Assuming I have the opportunity to open any dealership, would you choose Kioti?
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| chipuren
Join Date: Jul 2003 Posts: 193 Arkansas
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2006-04-01 127009
It would depend strongly on the local market. who your competition is and how many tractors are sold there each year. Plan on 3 years before you get any reasonable market share because buyers want to be sure you are going to stay around before they buy. Kioti is still comptitive and have a great product, good support network but established major brands will continue to dominate the market until you can get well established. Not to sound negative now but the tractor business itself makes very little economic sense, margins are small and cost to carry inventory is high, insurance, taxes, interest, etc. I would not want to depend on our new Kioti or Farmtrac tractor sales as our primary source of revenue. Either have a good service dept that can service older tractors (kiotis require very little service usually just routine maintenance and we are finding most owners doing their own oil and filter changes)
Get a good brand of implements. Again this all depends on your market. In some areas where tractor sales are very brisk, and the main lines are feeling a little independent, you could do very very well with Kioti. Just be prepared for buyers who don't value the standard features of the Kioti so say " how much? I can get a _(insert brand here)____ for that!" Kioti has moved away from being a tractor that can be sold on price alone. (my opinion and worth what I am charging and probably not a penny more). ....
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 | Art White
Join Date: Jan 2000 Posts: 6898 Waterville New York 
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2006-04-01 127012
I'm unaware of any law suits currently open as I believe they have been settled. That doesn't mean that one might not surface again. ....
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| chipuren
Join Date: Jul 2003 Posts: 193 Arkansas
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2006-04-01 127015
Yes, the suit was settled, terms of settlement have been reported as confidential, if the color of a new kioti is is compared to the other orage tractor it is obviously different. Seriously there are more tractor companies than colors, the whole notion of color ownership is rediculous, IMHO of course... I can think of 2 companies that would disagree and have the courtroom trophys to support thier side. Just cause its legal don't make it right! ....
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| NMessick
Join Date: Nov 2003 Posts: 19 Elizabethtown, PA
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2006-05-22 129691
If I had to choose one of the 3rd tier tractor brands it would be Mahindra. Kioti & LG have the lowest volume of any tractor brand, if this market goes soft they will be in danger. Kubota would be the first choice, they are the powerhouse in this business. However it does cost several million $$$ to get a dealership off the ground... if they will give you one.
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 | earthwrks
Join Date: Dec 2003 Posts: 3853 Home Office in Flat Rock, Michigan
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2006-05-22 129698
Our local blue dealerership of 47 years was sold by the owners to his experinced cousin and two other investors for 3.2 million---which didn't even include the bulding or inventory---just the rights to sell NH. I think the reason for this high cost is due to a major road contractor who got a big job and bought a NH dealership, then bought all his equipment that he needed from the dealership. Once he was done with the job, he closed the dealership doors for good. ....
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| NMessick
Join Date: Nov 2003 Posts: 19 Elizabethtown, PA
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2006-05-23 129716
There has to be more too it than that. The margins on equipment are very small, it would take years for them to recoupe the investment.
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 | Peters
Join Date: Feb 2002 Posts: 3034 Northern AL
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2006-05-23 129720
I agree that Kioti is a small company, 300 million vs 9 billion in sales for Kubota, but unlike other companies it makes the engines and the complete tractor. At the moment it is profitable and the Koreans have a habit of forming large combines like LG and Hyundai. My guess is that they would be bought up if there is a down turn. As they are a price leader a down turn in the market may push more business their way.
We thought Kia and other small Korean automanufactures would implode in the last Korean melt down, but they were bought up by the larger players.
Mahindra is not manufacturing modern tractors, their smaller more modern ones are being made in Korea. ....
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| NMessick
Join Date: Nov 2003 Posts: 19 Elizabethtown, PA
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2006-05-23 129725
I wish I could read the rest of your message. I wish this board would not require you to pay to read the entire message.
I do agree with you that Kioti would be (and is now) somewhat ripe for a buy-out. There have been rumors for awhile that Bobcat has been eyeing them up. ....
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| Peters
Join Date: Feb 2002 Posts: 3034 Northern AL
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2006-05-23 129732
As they have modern engine technology in the small diesels there are a number of manufactures, including Club Cadet who are utilizing them. As a dealer I think you can afford the small fee to support the board. I can almost garantee we have helped one of your customers. At least you can right it off unlike the rest of us. ....
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