In this installment of our 5 Questions With… series, we sat down with Positec USA Executive Vice President David “DJ” Johnson to discuss the company’s Kress brand of all-electric outdoor power equipment and why it chose Spring 2023 as the time to enter the U.S. market. Kress’ product lineup includes robotic lawnmowers, leaf blowers and chainsaws.
Can you explain a bit about who Kress USA is?
Johnson: Kress is a brand that’s been around for many years, particularly in Europe, and our parent company Positec, acquired the Kress brand back in 2016. We are launching Kress for the first time in North America for the outdoor power equipment in the spring.
We’ve assembled a team of very high caliber industry folks who have years and years of experience. I believe we counted over 1,500 years of experience in the team we’ve assembled. We have our director of sales, John Sloan, whose background is in the dealer channel. John’s recruited 6 regional managers, and then we have 36 business development managers, which will be our territory field team. In addition to that, we are recruiting and putting in place a product demo team nationwide to help support the dealer sell through of our products.
Why is now the right time to enter the North American market?
Johnson: We think there are two significant trends that are occurring. One I think we all can agree on is electrification, and we see this in cars. We’re beginning to see it in outdoor power equipment and many other things. Looking at drivers of electrification, one is pollution. Outdoor power equipment especially is a big polluter. So we believe with our products that will be available, we can help jumpstart that electrification trend.
The second trend is robotification. As I look around at different industries and the different things we do as a family, labor is a huge problem within the U.S. right now. So we believe that being able to provide a solution to that labor issue through robotification is a trend that will certainly be received very well. The second part of that is that time is a precious commodity for families. And we believe that cutting grass, as a chore, can be improved and can give families some time back. We think both of those trends are significant, and we’re planning around and developing products and programs to address those.
What does your dealer development plan look like?
Johnson: Our goal is to have 1,500 dealers the first season. We’re after a mix of dealers. Obviously we want to have commercial dealers, the best players in the industry to align with our products. And so we’ve been in recruitment mode. In fact, we had an event out in California in early October where we invited 200 of the very top dealers from around the country. Our CEO and Chairman Don Gao spoke, and we revealed the product and the strategies behind that. Equip Expo was also a big deal for us and was really the national launch of Kress.
Our team has been out riding the road, so to speak. They’re assessing market needs and best players in the markets. We’re adding dealers on a weekly basis through a review and onboarding process.
What’s the main selling point to dealers when you’re looking to recruit them?
Johnson: The main piece of it is what we’re delivering from an innovation standpoint. For example, the obstacles of moving a landscaper into cordless from gas has always been around the ability to manage batteries and the high cost required to transition from gas to cordless. It’s a lot more because of the number of batteries required to keep a production landscape crew going for the day or for a week was a bit cost prohibitive, up until now. And then where’s the landscaper going to plug in chargers?
So we are bringing to market what we call the cyber system. It’s a battery and charging system that will charge a 60 volt, 4-11 amp hour battery in 8 minutes, which is very rapid. That charger will mount in the back of a landscape trailer, and it runs off a battery. So in the evening, the landscaper would charge the tank, if you will. It takes about 4 hours to charge, and they’re ready to go all day the next day. And that tank can charge up to, depending on the amp powers of the battery, 30 plus batteries.
The other piece of it is the life cycle of a traditional lithium battery isn’t long. These batteries we’ve developed have a longer service life, up to 3,000 cycle lives.
At the end of the day, if a landscaper signs on to our cyber system and tools battery system, it’s about a $20,000-$22,000 conversion to get a crew going.
If that landscaper finances is out over 4 years, the cost per month of that is going to be a lot less than they’re spending on gas and two cycle oil.
And for the dealers, what we’re allowing them to do is sell not only the tools, but the fuel and the fuel pump as well. If you think about a traditional set of gas equipment for a landscape crew, we’re probably talking $4,000-$4,500. We’re now allowing a dealer to put that same package together for $20,000, because they’re selling the fuel and the fuel pump.
How is Kress adjusting their entry into the market with ongoing supply chain issues and struggling dealer inventories?
Johnson: It’s hard to predict the future when you’ve not had anything to go from in the past. We’ve obviously got a forecast together based on our dealer target number and how much gas-powered equipment is sold and how fast will it convert to cordless.
We do have this program that we are presenting to the dealers called the Kress Partnership Program and perhaps one of the largest benefits to that is that we’re placing all the product into the dealer on consignment. As a dealer sells it, we’re paying them a commission on the product. So the investment, other than time and effort, is very minimal on the dealer’s part.
Our plan is to put the product that comes in at the dealer level, and obviously we’ll hold some for replenishment and things of that nature, but if we find that a dealer is not selling it as well as another, we can move that product to another dealer. So we’re trying to get ahead of possible supply chain issues. We’re a $1 billion company already as it is, so it’s not like we're starting from scratch. Positec has been in business for more than 30 years.
