Originally Posted by Shrew
The problem with holding back 10% is what you're typically holding is the dealers money, not the manufacturers. It's a tough spot to negotiate from if the dealer is the one that is actually in the middle. At that point the cost to fix might meet or exceed the hold-back money.
That negotiation tactic is sort of saying "I'm holding your money hostage, ignore me and get nothing, or fix it and get nothing".
Or worse, Imagine a dealer looking at 70K in repairs while you hold back 50K, with no guarantee that they'll get reimbursed by the manufacturer. At that point, they have to choke on 20K to keep their reputation.
No one forced the dealer and manufacturer to enter into business together.
If the manufacturer is delivering a poor product, then the dealer should re-consider selling the manufacturer's product. If the manufacturer is not paying the dealer to fix things that is not the dealer's fault, then, again, the dealer should re-consider selling the manufacturer's product. Similar to if I go buy a car, I am usually not providing full payment without fully inspecting and test driving the exact car that would become mine. What if the car had major mechanical issues? Or had damage I could see? There is no way I would be accepting the car and the deal would be off.
On the other hand, if the dealer is damaging boats the manufacturer is providing damage-free or the dealer is not putting in any effort to fix minor damages/issues/submitting claims to have things repaired, then the manufacturer should consider dropping the dealer. Some dealers just care about making the sale and not providing after sales support. Properly organized, a boat dealer can make a lot of money on the back-end (after sales support/service), just like a car dealer. The problem is some of them are not competent to run a service business but can get by with little effort filling out some paper work to make the sale.
Perhaps one way to make the manufacturer-dealer relationship simpler is to remove the dealer from the picture. Like what Tesla is trying to do with cars. Some boat manufacturers have tried this (I think Bavaria). Some dealers add no value and are just a middle-man to take a piece of the pie. Problem becomes service and support. But in my experience, very few dealers know the product and getting them to service anything in a competent manner can prove difficult, so again, they are little-to-no value add. Therefore if the manufacturer is willing to authorize service yards of the customer's choosing to do the work, that can perhaps alleviate that concern. The manufacturer will just be concerned about some yards charging too much or overestimating. Some manufacturers currently operate like this and are not a pain in the butt in reimbursing customers for warranty work or paying yards directly.