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Positioning: Who Are You For?

Positioning: Who Are You For?

 

Guest blogger Alex Kraft discusses positioning in today’s blog, with the important question of who you are positioning yourself for? Who is your message meant to target? Are you a partner to your customers?

When you work for an established company, there are certain things that get taken for granted. Customers in the market know your brand and they’ve experienced your products. Opinions are formed based on experience. For young companies, the art of positioning becomes incredibly important.

Wikipedia defines ‘positioning’ as ‘the place that a brand occupies in the minds of the customers and how it is distinguished from the products of the competitors”. How do potential customers perceive your product when they haven’t experienced it and it’s not established? What I’ve learned over the past 18 months is: words matter. It’s remarkable how certain words trigger different responses and can create opportunities or worse, close doors in your face.

One of the major challenges with positioning is that everyone seems to use the same words, regardless of whether they are accurate or not. As I’ve written before on this site, Heave in its simplest form allows dealers/sales reps to quote contractors equipment (for rent or sale) easily on their mobile device. I’m very proud of what we’ve built so far and couldn’t wait to tell the industry….so terms like ‘platform’, ‘marketplace’, ‘e-commerce’, found their way into our positioning. The problem is that every tech company says that they are a platform/marketplace/e-commerce solution. The result is that you get drowned out amongst the crowd and no one remembers anything. Even worse, a customer will just assume your product is the same as one that they’ve maybe had a poor experience with, because of that similar description (without even trying it!).

For equipment dealers, it’s similar. Pick a dealer, any dealer. Don’t tell me who they are, let me guess: do they have the ’best’ or ‘quality equipment’, with ‘THE BEST SERVICE’? Are they ‘customer first’?

Are they a ‘partner’? I remember when I started as a Volvo salesman and attended a factory training session. Naturally I wanted to learn the areas where we had a competitive advantage, something tangible. One thing that I left armed with was Volvo’s superior fuel economy compared to the competition. Unfortunately for me, I was flipping through a Construction Equipment Guide the next week and I see ads for Case promising the ‘best fuel economy in the industry’, same as CAT, Deere, and Komatsu. Now Volvo is just another brand promising the same thing as everyone else. I had to go back to telling customers we just had the ‘best service’….

With Heave, we created something new and started with a blank slate. I became frustrated early on as we met people in the industry. ‘Why don’t they get it?’, I would ask one of my partners. It seemed so simple to me, but I lived it every waking moment. The more I read and researched other companies, the more I came to understand how important positioning is, and how it can set companies apart. I didn’t realize the skill involved in articulating an idea concisely with an economy of words. Once I had an appreciation for the nuance involved, we began tweaking our positioning. As we met with clients you could tell that it was resonating more, and we were getting closer. The final ‘aha’ moment for me was something that I believe every dealer/OEM can also learn from.

Positioning goes together with identifying a target market. A mistake that I know well is not recognizing your ideal customer. In the early days of Heave, I was afraid that if there were 100 potential customers, we needed to appeal to all 100. We couldn’t afford to have a smaller potential pool of customers I thought. Thankfully, I came across a sales trainer named Josh Braun. Josh’s content opened my eyes to how successful salespeople don’t try to sell or pitch to everyone; they focus their efforts on those who fit the solution. It finally clicked for me. Heave is not for the 15-20- year veteran salesperson who has the same 15 accounts for the past 10 years. Heave is for the younger, inexperienced, hungry sales reps who are new(er) to a territory and building their book of business. Have you ever noticed that those who say that “it’s a relationship business” are the ones who’ve had the relationships for 20 years? That saying is code for “this is MY customer, go find someone else!”  This exercise was incredibly liberating for our team because it brought clarity to our mission and removed a ton of pressure. Now we weren’t wasting time talking to those who weren’t a good fit for our product. Do I believe that Heave could help that 15-year veteran salesperson? Of course, but why push a boulder uphill? Go talk to the 50,000 equipment salespeople in the US who are tired of cold calling offices and jobsites, that keep showing up and never get past the gatekeeper. Their manager offers solace by telling them, “Don’t worry, it’s just part of it.  It took me 24 months to get my first crack at quoting Contracting. Now they buy 5 machines per year from us.” That is our ideal user and our positioning followed. Now we were speaking directly to them.

While equipment dealers aren’t starting with a blank slate, there is opportunity to stand out since everyone has been using the same terms since the 1960s. Don’t make the mistake of just copying the competition. You don’t have the same resources as the competition, and you don’t get credit for the ideas if you just are copying what someone else does. Who are the customers that your competition doesn’t serve? Maybe this fresh positioning could be tied to embracing the technology driven changes occurring in the industry? Maybe your positioning can be focused more on certain products or customer segments? On second thought, consistency is your friend, and you can’t go wrong with ‘We take customers to lunch, sign paper contracts, and we stock a lot of parts.”

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The Blurry Lines of Blame: Psychological Safety in the Workplace…

The Blurry Lines of Blame: Psychological Safety in the Workplace…

Guest writer Sonya Law is here to enlighten us again from the world of Human Resources with her latest blog post, “The Blurry Lines of Blame: Psychological Safety in the Workplace…”

“Be the leader that you wish you had, when we become a leader, it is important to remember the IMPACT that we have on others with our words and actions…” Sonya Law

Psychologically Safe workplaces take Ownership

We know that sinking feeling as a leader when something goes wrong in a team, or a mistake is made, especially when the impact on the business is significant.  In that moment it’s easy to assign the blame to someone, in order to direct the spotlight away from ourselves.  

However, this does not provide a psychologically safe environment for employees.  When we immediately pull the blame lever, it makes the employee feel small and powerless, its disempowering. 

Good leaders know about the blurry lines of blame. The better approach is to:

  1. Focus on the problem not the person
  2. Root cause the problem 
  3. Implement process improvements
  4. To stop the problem from reoccurring
  5. Involve the team who are responsible 
  6. EMPOWER the team to be part of the solution
  7. Transfer ownership to the team in a positive way.

The reason that blame is such a slippery slope is that it’s a toxic emotion.  We all have at some stage in our careers been on the receiving end of someone’s negativity.  The risk to the business is the employee feeling disempowered, disengaged and leaves the business adding to the staff turnover.  

It’s not about minimizing accountability it’s about taking a more considered, thoughtful and collaborative approach that produces better outcomes for the business.  When we tackle problems together, we ALL grow.

Positive, Innovative Cultures thrive

It also serves to provide a psychologically safe environment for employees and positive culture in which to thrive.  At a time when there is a talent shortage, it’s important part of the retention strategy that we are supporting employees to feel safe at work.

More importantly when you empower employees to be part of the solution it promotes innovation in the business.  

When we take this role as leader as coach and to role model positive behaviors around making mistakes it leads to improvement in critical thinking and problem solving.  Which are key business skills as we face an uncertain world and business environments. 

Happy employees are productive, open to learning and change

Happy employees are also more productive and likely to take on more complex work or stretch projects and set more challenging goals, when it feels safe to make mistakes.  They tend to be more open to learning new skills.  Leaders and businesses who role model a growth mindset and a curious mind, will have the competitive advantage when it comes to people, product, service and technology and respond better to change.  

Agile businesses position themselves well for Growth 

It’s important that businesses are agile, the ability to adapt and change leads to Growth in any business.  A leader who understands this will be able to attract top talent and have a collaborative work environment where the work gets done but they can also have fun and celebrate the wins along the way.

It leads to better outcomes for the business when you take care of people and take them along on the journey and GROW together.

“View every problem as an opportunity to GROW” Bill Marriott.

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Relationship Selling Metrics: Face-to-Face & Write-Ups

Relationship Selling Metrics: Face-to-Face & Write-Ups

Guest writer Floyd Jerkins continues his series on Relationship Selling Metrics by looking at the numbers in face-to-face sales and also in your tracking of your sales with write-ups, and a careful system of staying organized.

Operating a business requires a basic understanding of financial management. Knowing the numbers is important in making good decisions. If your expenses are too high or sales are dropping off you make changes. Do you know how many customers your sales team talks to every week? Many organizations don’t know the answer and are leaving thousands of dollars on the table for a competitor to get.

Ok, let me do a reality check. There are issues with starting to measure a sales team’s effectiveness. Typically, the measurements start with sales volume and other financial metrics. Make no mistake about it; I am a proponent of these. The challenge is to identify where the sales process can be improved before the close of the sale. When you can enhance salespeople’s actions from the start to the end of the sale, the closing ratio goes up significantly.

By now in your business life cycle, you have some sort of a CRM in place. Various tools on the market are either simple or as complex as you want. Getting your sales team to log each sales action properly is yet another challenge and a whole article all to itself. So, with my disclaimers in place, let’s explore.

Measuring a salesperson’s success by the total revenue they generate is only one part of the equation. If a salesperson is selling 5 million a year, but leaving 5 million on the table, really, how good are they?

First, to be successful in sales, you have to talk to a lot of people. You also have to give a price to make a sale. Simple, right? Here is my rationale for a few sales performance metrics to get us started. Each CRM, as well as your organization, may call them something different, so please read between the lines if you will.

  • Face-to-Face Contacts- This category measures how many face-to-face contacts a salesperson encounters on a day, week, and month. This could be a new prospect who has never been to your store or a previous owner who’s bought from you before or even a referral.
  • Sold- Meaning the product is sold and delivered. Paperwork is done, financing is approved, and the checks have cleared.
  • Write Up- Meaning that the salesperson quoted a price and then wrote the order. This doesn’t mean it’s closed, just that a written order was initiated.

Sample Questions About Performance

What percent of Face-to-face to Sold do you think is a good number? 

In the article, Relationship Selling- How to Measure Sales Success, I outline the basics of measuring the types of customers most businesses have. The average closing ratio, many say is 20%. I think that’s a weak number and here’s why.

Long-standing businesses have repeat customers. What if your sales team has 100 Face-to-Face contacts in a month that are repeat customers? Do you think closing 20% is acceptable? I don’t. The salespersons selling process needs to be revised because they cost the business thousands of dollars. Factor in your marketing investment to get an ROI that’s not impressive.

Take each “unit” the salesperson sells and divide that by the total number of face-to-face contacts in a given time period. If you establish a salesperson has a 20% closing ratio, what if they could improve that 5%? A 5% increase would increase the “unit” sales. This is a “natural” increase to make more sales. It doesn’t cost you anything if you help your salesperson improve their effectiveness.

Your business should be closing at least 40% to 60% of your repeat customers. Without measuring, you have wishful thinking. 

What percent of Write-Ups to Face-to-Face contacts is a good number for an experienced salesperson?

Typically, a salesperson will share a price with a customer before they even qualify what the customer wants. This is generally because that’s one of the first questions a customer asks, “How much is it?” Salespeople feel obligated to answer every question vs. learning to control the sale through questions.

The rule of high volume and high margin sales is never price before you establish value. 

A salesperson who verbally prices, especially if they don’t establish value before pricing, will have a lower closing ratio compared to a salesperson who makes written quotes every time they price. Increase the number of professional write-ups, and you will close more sales. 

80% of all pricing should be in writing. 

How effective is an experienced salesperson that sells 30% of their previous customers? 

Let’s say you are measuring the type of customers your sales team is talking with. You know the % of each category. Every time a salesperson prices a customer and a sale is not made right then, the customer leaves the business.

Statistically, I know that most salespeople are not good with follow up. Nearly 7 out of 10 don’t follow up within 24 hours after they price a customer who doesn’t immediately buy. Part of this is because sales managers often focus their team in the wrong direction due to various financial or inventory pressures. The other part is they lack a system as well as the verbal strategies to service the customer. Many salespeople are great at selling the sales manager on why they shouldn’t call back, or they wait on the customer to “get back to them” as they artificially promised.

If this experienced salesperson is only selling 3 out of 10 customers, what is happening to the other 7? If you have a sales team of 10 with a 30% ratio, look how much is being lost due to an inefficient sales process.

Measuring allows you to know the realities of how to improve your sales team’s behaviors and maximize your marketing budget. 

Measuring tells you exactly where to influence the behaviors of your salesperson and sales team. 

Learning to be Effective Starts with Performance Sales Metrics

Talking to a measured number of prospects in a given period of time is just part of being successful in sales. There are only so many selling hours in a day, week, and month. Learning how to be effective with each contact starts the journey of successful time management.

By establishing value and knowing how to communicate that to a prospect, the closing ratio goes up dramatically, but so do the margins. A sales-driven organization takes time, energy, and the correct vision to have a highly competent team.

What are the performance sales metrics for your sales team? 

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Do You Really Need PRODUCT SUPPORT PSSRs, or CSAs?

Do You Really Need Product Support PSSRs, or CSAs?

Guest writer Bill Pyles shares all the ways we really do need Product Support SRs or CSAs.

Most larger equipment dealerships have a robust PSSR (Product Support Sales & Service Rep), CSR (Customer Support Representative) or CSA (Customer Support Advisor) that has been in the making for years. This group of Product Support men and women are an integral, value-added, sales and profit generating part of the entire dealer organization.

But maybe you’re a smaller dealer and looking to get to the next tier of the Product Support ladder. 

This blog is for you!

The CSA acronym is my personal favorite as I truly believe the words customer support advisor best describes the position. The CSA is the direct link between the dealer and everything Product Support related. A well-trained CSA offers the options that meets the financial and equipment requirements of the customer. Should a failed engine be repaired, rebuilt, or replaced? Is the machine a production machine or a backup? Is the machine scheduled to be sold out of the fleet within the next six months? While the machine is down, are there any other critical areas of the machine that need inspected and repaired before going to failure? Customers get very angry when a leaking final drive went to complete failure, resulting in a machine down situation just after leaving your shop.

If your dealership sells and services tracked type equipment (excavators, dozers and tracked loaders) I know your aware the largest cost of ownership is the undercarriage. The undercarriage is a system into itself. Your CSA should have a complete understanding of the undercarriage system. A simple proper track adjusting discussion with the customer demonstrates a knowledge that will save him dollars and downtime. Getting a customer maximum undercarriage life will save thousands of dollars over the life of the machine. 

You’ll also need a good machine population file. It’s tough to forecast sales not knowing your opportunity. A good machine population file will identify the aging, location, and hours on the equipment. By the way a good population file is beneficial to sales, many machines are removed from the fleet after so years and hours. New sales opportunities!

Typically, the 80/20 rule is the typical CSA customer list. The top 20 customers assigned to a CSA typically take of 80 percent of their time and resources. Dealers will need to develop the unassigned fleet customers and the “middle segment”, customers who have your equipment but do not purchase any parts or services.

You’ll need an annual CSA meeting to discuss trends, sales forecast, changes in the market and to celebrate over and above accomplishments (just picture your last whole goods sales meeting).  Is the GM or dealer principle attending? The GM and or dealer principle must make an appearance to show support and comment on the current business environment and congratulate the high performing CSA’s. A well-developed CSA program will give you much to celebrate!

But who does the CSA report to? The dealer principle? 

I once worked for a regional vice president who upon returning from an executive meeting was convinced, we should terminate the CSA program, all of it, today, now.

This executive meeting was held during one of the severe cyclic downturns in heavy equipment sales. Dealers were struggling to survive and expense control was job one. Elimination of the CSA program would save accelerating expense dollars. His rational was simple, if severely flawed. We have a good product and if a customer experiences a failure, he will simply pick up the phone and call us. And with our new snazzy web site, the customer will simply log on and make arrangements for needed parts and or service. After thinking this over maybe for 60 seconds I countered with the elimination of the whole goods salesmen using the exact same logic; we sell good equipment and if a customer needs a new machine or a long-term rental, he will simply pick up the phone and call us. Fortunately, neither plan was put into action, we survived the downturn and came out stronger on the other end.

The sales manager? Maybe not a good choice as the sales manager has enough on his plate with inventory, inventory aging, salesmen, OEM programs, order windows, financing and fleet deals. A CSA reporting to the sales manager may turn into a delivery driver for a bucket, gathering hours for a trade in or running out docs to be signed.

The parts manager? Maybe not a good idea as most part managers are outstanding at managing their inventory, over the counter fill, stock orders, counter activity but not managing a parts and service sales person.

The service manager? Not here either. Service managers have many balls in the air dealing with shop service, field service, training, warranty, the pothole in the parking lot (a little sarcasm) OEM’s and technicians. Not much time to manage a CSA. 

A CSA without a direct supervisor soon becomes a “floater” or Product Support orphan employee.

A better solution would be a Product Support Sales Manager or a position with a similar title. This person would have 100% accountability for a successful CSA program. He or she would work closely with parts and service management in writing CSA goals that are in alignment with company goals. The Product Support Sales Manager would do the CSA’s bi-annual and annual performance reviews as well administer incentive plans and salary increases, create annual sales forecasts and work closely with the OEM representatives regarding OEM Product Support programs.

A Product Support Sales Manager is the mentor, manager, and coach in developing a CSA. CSA’s must have a career plan with defined goals in sales and service activity. I worked at a dealer who had an outstanding Product Support Sales Manager, super high energy. I truly believed this man could inspire CSA’s to sell snow plows in Miami Florida! 

A CSA MUST participate in technical training for the products the dealer represents as well as management level training in negotiating skills and people skills. A successful CSA will have a basic understanding of oil sampling, why on time PM’s are important and an excellent understanding of repair, rebuild or replace options. These skills development can be better managed by a qualified Product Support Manager who reports directly to the dealer principle.

CSA Vehicle: Car or Pickup Truck.

I’ve had responsibility for CSA’s and have experience with both the CSA company vehicle being a car or truck; pros and cons for both. If you give your CSA a car allowance and he or she uses their personal vehicle, you’ll soon find the car parked and a company truck “borrowed” for the day to run out some rebuild pumps and a cylinder or two. Car allowance or not, the CSA will be reluctant to damage or have spilled oil in the trunk or floor. In my opinion a pickup truck sporting the dealer’s name and logo is your best choice. Graphics today look sharp on the job site and rolling down the highway. And when on site, if there is something that the CSA can help out by running something back to the shop, it will not be a problem. However, you’ll want to avoid your newly minted CSA into becoming a parts runner. I do suggest that when a CSA plans his day, he or she will check with will call to see if there are some parts he can bring out and check the service WIP (Work In Process) to see if the customers he’s calling on today have any equipment in the shop and get the status, the customer will ask, be prepared!

CSA Salary & Expenses

CSA salary and expenses are usually split 50/50 between the parts and service departments. I’ve heard arguments that a CSA will sell more parts than service and parts should pay more of the percentage. Most CSA programs are salary and commission based. Another responsibility of the Product Support Sales Manager.

But keep in mind, a dealer’s best margin comes from labor sales. It’s the responsibility of the Product Support Sales Manager to steer the CSA into higher labor sales. If a customer needs a reman engine and the CSA provides a quote for the reman engine, the labor to do the remove and install must be included. I think Michael Jordan once said he missed every shot he did not take. The same applies here; don’t quote the labor and you surely will not get it. Your competitors may be quoting the same reman engine AND the labor. The customer likes the turnkey repair and asks your competitor when they can start. Always provide a professional estimate/quote and follow up with the customer. Add value and close the deal!

Customer Support ADVISOR

When I was a newly minted Product Support Sales Manager, I thoroughly enjoyed customer visits and scheduled customer meetings. I’d wait for an opportunity to ask the customer if a recent issue, wrong parts, late service call, etc. he brought up was discussed with his CSA (I did not use the CSA’s name). If the customer replied “oh you mean the guy who measures our tracks” then we’ve failed to make the ADVISOR relationship with the customer. A good gap we need to close. CSA’s need to listen when the customer talks and suggest solutions to equipment problems. I know we’re providing value when the customer asks the CSA “what do you think?” When the customer says those words, the rest is up to you to deliver the outstanding Product Support that makes you the “go-to” dealer!

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The May Gordon Report: Hope, Jobs, Change

The May Gordon Report: Hope, Jobs, Change

Guest writer Edward E. Gordon has returned with his report for the month of May: Hope, Jobs, Change.

What are the major roadblocks to changing the ways the United States develops its workforce? We recently sought some answers from other workforce development leaders who also seek major improvements in our education-to-employment systems. There is general agreement that there are new education and training programs that improve adult and student learning, but there are significant obstacles to effectively and comprehensively implementing them.

 Over the past 30 years regional public-private partnership hubs have been formed that integrate the wide variety of community resources needed to address skills-jobs disconnects and today’s vacant jobs crisis. But these pathways to a better educated workforce have only been supported by a comparative handful of enlightened community and business leaders. Why haven’t they been widely adopted throughout the United States?

 Storrs Hall in his book, Where Is My Flying Car, gives several cogent explanations of why people in general are very resistant to systemic change. When their money, power, or prestige are at risk, systemic change issues are often turned into personal turf wars. Hall calls this the “Machiavelli Effect.” As Machiavelli stated in his controversial 1532 treatise, The Prince, innovators are often opposed by “all those who have done well under the old conditions.”

 Hall asserts that bureaucracies today pose major obstacles to implementing systemic change. There are well-entrenched bureaucracies in business, education, unions, and government. He finds that bureaucrats often block changes because of a “failure of imagination.” They believe in their superior expertise. They automatically rule out the potential of untried but worthwhile solutions.

 Hall also contends that bureaucracies stifle change due to a “failure of nerve.” Solutions to current challenges gain significant support. Only the details of implementing them need to be worked out. But nothing ever happens! Bureaucrats succumb to the fear that the results of his process will be so good that their leadership will be threatened.

 Bureaucracies are powerful because they are able to use resource starvation and regulations to suppress systemic change. Furthermore, America today is split into warring factions that resist working together to combat threats to our prosperity and way of life. In its history the United States has faced formidable challenges and forged innovative solutions that moved the nation forward. What can we learn from the past?

 After travelling across the United States in 1831, Alexis de Tocqueville wrote Democracy in America in which he concluded that civic activism was America’s greatest strength. As the United States expanded in territory and population during the 19th and early 20th centuries, ordinary citizens banded together to form local governments and organizations to solve common problems and meet local needs. 

 Tax-supported public education is among the most prominent advancements resulting from civic activism. By 1918 spurred by the Progressive movement, all the then states in the United States had enacted this reform. The United States became the first nation in history to attempt to offer a basic education to everyone. The system was far from perfect, but for most of the 20th century it worked well for most citizens. But the technological demands of the Fourth Industrial Revolution have made this education-to-employment system obsolete.

 Why do we need a revival of civic activism today? There are at least 1.8 job openings for every unemployed worker. U.S. inflation has reached a 40 year high of 8.5 percent. Companies across all business sectors cannot find workers with the requisite skills to fill up to 13 million vacant jobs, thus threatening significant wage inflation. Unless significant efforts are begun to bridge the talent gap between current educational preparation and the rising skill needs of local/regional businesses, we believe that by 2030 the U.S. labor market will be in an even deeper crisis, perhaps triggering a popular backlash that could destabilize our nation.

 We contend that America’s participatory democracy offers viable solutions to this grave employment crisis. During the Progressive Era a broad spectrum of voluntary organizations were formed. Many of them focused on civic improvement, such as Chambers of Commerce and Rotary Clubs. Today they and other groups and agencies such as Workforce Development Boards, regional economic development organizations, sectoral business alliances, community colleges, K-12 educational agencies, parent organizations, and unions are serving as catalysts for initiating broader public-private partnerships to update regional education-to-employment systems. Your advocacy and support for such efforts in your communities are vitally important for their success.

 For a more comprehensive analysis of the causes and solutions for the current skills-jobs mismatch, see Job Shock: Moving Beyond the COVID-19 Employment Meltdown to a New Skilled Talent Decade

 

Edward E. Gordon is the president and founder of Imperial Consulting Corporation.

 We invite to submit your questions or comments by email or calling us in Chicago at 312.664.5196.

Thank you for your continued interest in our publication.

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Relationship Selling: Measuring Sales Activities Generates More Sales

Relationship Selling: Measuring Sales Activities Generates More Sales

Guest writer Floyd Jerkins continues his series on Relationship Selling with this week’s blog post: Measuring Sales Activities Generates More Sales.

Whether you have two or 200 salespeople, just talking to more people isn’t the best way to improve closing ratios. Measuring their sales activities generates more sales and allows you to know exactly where they need coaching.

Are You Using a Sales System?

Before we get too deep, let’s make sure you and I are on the same page. I believe you have to be using a sales process and a sales system. The key is to know where you are at in the sales cycle and to know where the customer is at in the buying cycle. Without utilizing these tools, you guess and wonder let alone waste valuable time.

Stop here and check out a couple previous articles of mine on the Steps to the Sale and Relationship Selling: Face to Face & Write Ups, and How to Measure Sales Success. It doesn’t matter that you are using different terms. What is vital is that you are working a sales process with your team and that each salesperson logs into a CRM.

Measuring Effectiveness is the Key to Increasing Sales

Why are salespeople having problems closing sales? Measuring what their sales activities are between the time they first talk with a customer until they price or close the deal will tell you where adjustments can be made.

Will most strategies work with all the customers all the time? Heavens no. Will they work with most of the customers, most of the time? Yes. Sure, the market is tough, prices are high, and the world is turning over and over, so we want to use real-time behavioral analysis to chart a path to more success.

Through analysis for example, you see they are shortchanging the qualifying process. They are getting into the close and realize they don’t know how much down payment the customer has, or that they had a trade-in, or they are not the decision-maker or myriad other things that can derail the close based on your kind of product and business. How are they building value of your product and your business if they don’t know this early on in the sales process?

Building value happens throughout the sales process, not just in the close.

If it all comes down to price, then just post your best price by a kiosk and fire all your salespeople. You improve a salespersons effectiveness not by talking to more customers but by doing a better job with those they work with.

What if you were able to improve your salespeople’s closing ratio from 10% to 15%, how much more money will you make?

Learning to ask better questions isn’t normal for many salespeople. Letting the customer control the tempo of the discussions happens. A good salesperson knows how to navigate the conversation to get out of it what they want, vs. just giving the customer what they want. Asking for the order too prematurely or pricing too quickly delays the buying process for the customer, takes more time to make the sale, and typically makes less margin.

An Exercise to Learn By

If your salespeople are closing deals at anything under 25%, then they are not exempt from a sales manager closely monitoring their sales behaviors. I’d want to see, feel and touch what’s happening in real-time.

Exercise Preparation

My goal here is for you to outline a complete customer profile to use in a roleplay. I’m not saying be an easy customer, but be realistic. Be the kind of customer that your salesperson encounters most of the time.

Include what the customer is looking for and why. List how they plan to pay for it and why they are shopping at your business, if they are married or not, and anything else that describes their buying motivations. List what they like the most and least about what they currently own and how much they paid for it. Did they finance it or pay cash?

Roleplay

Roleplay with your salesperson using the outline as your guide. Start with the introduction between the customer and the salesperson. Have the salesperson show you how they handle the first few steps to the sale. See how “effective” your salesperson is at finding out all that information in a casual, professional and sales focused manner.

Results

If your salesperson doesn’t like roleplaying because it’s not real, ok, you have a problem. If they do the roleplay but then make comments like, well, in a real situation, I wouldn’t say it like that. 

You have a problem.

The start of the sale should make the customer feel at ease. Does the salesperson make a good introduction? The next step in the sales process is discovering or qualifying the customer. This is where they ask several questions and learn how to build value in your products and services that matter to the customer. Do they handle this well or shortchange the process?

A Coach Calls the Plays

In any professional sport team, the coach calls a play. They know the stats how each player performs and under certain conditions make changes. When a sales manager measures sales activities they know the stats of how each player performs. They know what plays to call and it reaps more sales.

Sales teams who are only measured by total units sold or just dollar volume, are leaving thousands of sales and dollars on the table. Measuring their sales activities generates more sales and allows you to know exactly where they need coaching.

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Preparing for ERP Vendor Selection

Preparing for ERP Vendor Selection

Our new guest writer Joseph Albright writes his debut post for Learning Without Scars with “Preparing for ERP Vendor Selection.” Joseph Albright has over 25 years of project management and procurement experience working with equipment manufacturing facilities and dealerships around the world in training, supporting, and implementing ERP systems in the areas of Finance, Sales, Purchasing, and Rental. In addition, he has led numerous teams and projects in cost reduction and spend analysis initiatives totaling tens of millions of dollars in annual savings. Joseph’s main passion is working directly with customers and adding value to their organizations.

“Do you know what you want?” “Do you know what you need?” These seem like pretty simple questions to answer yet when talking to a potential ERP (Enterprise Resource Planning) provider they can be pretty hard questions. Some responses range from a straightforward “Yes” (followed by a list of requirements) to “I think so, but we’re not entirely sure” to “Not really, can you help”. All of these, including the first one, have inherent consequences that are not always good and choosing an ERP system provider is too large an investment to not be certain about the answers to those questions.

Choosing to invest in an ERP is a large investment. It can cost anywhere from $100,000 to $2,000,000 depending on the complexity of the system, what parts of it are going to be implemented, and the number of users that will be using it. That’s just for implementation and does not count ongoing license and maintenance/subscription fees. Typically, it will provide for Purchasing, Sales, Inventory Management, Financial Management, and Reporting. Additional features such as CRM, HR, Manufacturing, Parts and Service Sales, and Rental can also be implemented as well as many more cross-functional features. The cross-functional and data analytics features can bring huge benefits to an organization but will also require cross-functional resources which significantly add to the cost of implementation. Not knowing precisely what the requirements are for implementing such a system will only add more cost and delay any return on the investment. Be sure to have a predetermined budget that includes not only external costs but internal costs as well and has been agreed to by all internal stakeholders.

So, what needs to be known? How best to answer those two key questions? Well, the very first thing to determine is how is the business currently being run. What are the current processes in each functional area and what pain is being experienced within those processes? Document and map out these processes and determine the gaps between the way things are currently being done and the way they should be done. These gaps are most likely causing the pain. Determine whether these gaps can be resolved by simply changing processes. If not, they become potential Functional Requirements for an ERP system to resolve. 

Once all of the cross-functional gaps have been identified, the list, along with any other requirements, can become part of the Vendor Selection Scorecard.  This scorecard should be reviewed, prioritized, and weighted by a team of cross-functional stakeholders who will also become the stakeholders during the ERP implementation. Finally, be sure to include the IT Department or IT provider in both creating the scorecard and in discussions with the ERP vendor candidates to discuss any technical requirements as well. The scorecard becomes the criteria for identifying those ERP solution providers that seem to be best able to meet those criteria and can further be used to create the RFP to send to the selected vendors. It is good to have five to ten potential vendors to choose from initially if at all possible. 

Following this process enables a company to come to the table prepared to discuss and agree on requirements, scope, budget, timeline, and required resources. Companies who have not done their due diligence in terms of documenting processes and gaps tend to rely heavily on the vendors themselves to suggest the best solutions.  While in theory potential providers should have the knowledge and integrity to do so, even with the best intentions things get missed and the system fails to provide the desired outcome.

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Relationship Selling- A Tool for Improving Your Presentation

Relationship Selling- A Tool for Improving Your Presentation

Guest writer Floyd Jerkins joins us today for another article on relationship selling. This time viewing relationship selling as a tool for improving your presentation.

Since you are following my articles on Relationship Selling, by now you’re starting to get it that I believe in following a system. That doesn’t mean every sale made is templated. It does mean that the more times you can follow a system, your closing ratio goes up.

Practice the Fundamentals Before Engaging Customers

Feedback from master salespeople who do an honest evaluation of their sales strategies often mentions that reviewing the fundamentals before creating an advanced approach just makes sense. Why do professional NBA or NFL or any other professional team work on fundamentals at every practice? They practice on the sidelines, not on customers. They work on the fundamentals.

The Chair Salesperson

Let’s say you are selling chairs. You meet the customer in the aisle after giving them a few minutes to roam the store. You start with an opening line, Welcome to our store; how may I be of service? Of course, the answers could go a few different ways so let’s say they are looking for chairs. 

You are into the Qualifying stage of the sales process. Too many salespeople will start by sharing what chairs are for sale, how many they have, and where they are in the store. A professional furniture salesperson starts by asking questions about why they want a chair, what they have now, what different features they are looking for, etc. You build rapport through questions and showing a sincere interest in the customer. 

Through this stage, you’ve learned that your customer loves their grandchildren, has a bad lower back, likes to rock in a chair, and doesn’t like leather. Ok, great, now you have something to talk about that’s important to the customer.

What is important to the store manager is that inventory turns. What’s important to the salesperson who is on commission is that they sell a chair today. But none of what’s important to the store manager or the salesperson is valuable to the customer. 

In the presentation stage, what do you present about the chair that you’ve selected for the customer? You wouldn’t pick a leather chair that doesn’t rock just because it’s the one on sale or the one your manager told you to sell today, would you? You’d present the chair with the customers’ needs in mind, wouldn’t you? I hope the answer is yes!

Customer Expectations

During the first few steps in the sales process, the customer expects the salesperson to ask questions. It’s a normal process. By using this opportunity to explore, you learn about the buying motives, who the buyer and decision-makers are, how they want to pay for it, how much down payment, and just about anything else you want to know. If you are into the closing stage and asking the customer how much down payment they have, you are well on your way to being an average salesperson and will make an average income and live an average life. 

As you ask questions to learn, make notes. Don’t be afraid that you should remember everything. A good salesperson may talk with several people in person and over the phone every day. Good note-taking is an essential part of time management. I cover those subjects in other articles. 

Working Smart: Tools of the Trade

A professional technician who works on cars has a large toolbox with many drawers. Each drawer contains a tool that’s used for a certain purpose. A good tech won’t use a crescent wrench when they need a 5/8-line wrench. A great salesperson uses selling tools in the same way. There are tools of the trade that help to close more sales in less time. Use them well, and they will make you money and create a lifetime of customers. Don’t use them, and you will struggle with making sales and a significant income. 

In teaching sales and sales managers, I always tried to make it easy to learn new ideas. Now, this isn’t always easy, but using acronyms always helps with retention. 

The SPACED analogy is a tool. Here is how this works. 

Mr. Customer, you’ll notice that the chair rocks but it won’t tip over because of the extra flange on the backside of the platform. That’s a perfect safety feature to prevent you from overturning the chair when you’re rocking your grandchildren you mentioned. Will that feature become valuable to you?

Mr. Customer, you mentioned (while we were in the qualifying stage of the sales process) that you preferred cloth over leather. This particular chair has a cloth velour that is easily cleaned and won’t stain. The appearance of this will last for years and years. Does that type of feature interest you?

Mr. Customer, please notice the adjustable lumbar support in lower part of the seat. That has a wide range of adjustments to custom fit to a person’s backside. You mentioned you’ve had some back problems, does this type of feature sound important to you to improve comfort?

Ok, see how the spaced concept works? When you are in the qualifying stage asking questions, you want to learn what the hot buttons are. By keeping the spaced concept in mind, you pick these up and can use them during the presentation.

When you present your product through what you learned the customers wants or needs are, it’s like magic. You soon learn if you are on the right product. Now, pay attention, we’re not even talking about price here are we? If everything is right for the customer, the price is still important, but not the most important. You are building value.

Note that after every explanation of a feature I ask the customer a question to validate that the feature is what they wanted or that it is important to them. Why do this? What you don’t want to do is make an ineffective presentation by covering too much detail when the customer might not want it. You also want to make sure that you are getting buy in from the customer as you explain key features of your product or service before moving on to the next feature.

In closing…

By systemically asking these questions before moving on to the next feature, you are learning if you are on the right track or if you need to make a course correction with a different product. You are building value.

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Quality of Communication Channel Part 2

Quality of Communication Channel Part 2

Guest writer Ryszard Chciuk educates readers about service quality in his blog post on the quality of the communication channel.

Quality of Communication Channel Part 2

When writing about the quality of the communication channel, I mean the definition of service quality worked out by Parasuraman, Zeithaml, and Berry in 1985:

  • Service quality is the degree and direction of a discrepancy between customers’ service perceptions and expectations

To improve the quality, we have to close gaps causing the difference between customer expectations and his perception of service. The central gap is:

  • Not Knowing What Customer Expects

In the previous articles about communication channel quality, I presented my view on specification sheets, operator’s manuals, and social media. This time it is about a dealership blog, the interactive blog.

Several years ago, I attended a meeting with the key people from one of my country’s leading construction equipment dealers. We had an exciting discussion on the dealership advantages when the blog function is added to the website. I am summarizing here my thinking about that idea. 

I have checked some web pages of dealers representing the leading world machine manufacturers of machines for the construction industry. I also checked the top manufacturers’ websites. I bumped into only a few manufacturers’ blogs. Blogs’ content I have found on the local dealerships’ websites was mainly a copy of those. Is it possible that a specialist in the manufacturer’s headquarter knows the troubles of the local machine users? Yes, he knows machines, but can he build close relations with local customers through the blog he is running? 

The blog function included in the company website will not shift your marketing from the billboard alike into the engagement one (definitions by Mets Kramer) if it is done traditionally. What do I mean by the traditional way? After you click the BLOG button in the main website menu, you are directed to the billboard containing articles about subjects the dealer or a manufacturer wants visitors to learn about. Do those articles consist of answers to questions bothering potential or current users of construction machines? Yeah, perhaps the dealer thinks so… Is it the best way to practice engagement marketing in the digital dealership? I believe it is necessary to have an interactive blog.

The interactive, thus engaging, a blog is interactive when it has a function of comments. Only Volvo CE NA has a comments function activated among the ten top manufacturers. During the last four years, they published over 90 articles and received circa 70 visitors’ comments. For example, the article “Wheel Loader Operator Tips: How to Load Trucks with Added Efficiency and Productivity” is commented by readers: 

I am so happy I found your blog and I absolutely love your information about wheel loader operator tips how to load trucks with added efficiency and productivity! I liked and it is wonderful to know about so many things that are useful for all of us! Thanks a lot for this amazing blog!!

And another one:

Thank you very much for wheel loader operator tips how to load trucks with added efficiency and productivity, it’s difficult for me to get such kind of information most of the time always… I really hope I can work on your tips and it works for me too, I am happy to come across your article.

I know from my experience how difficult it is to keep the comments’ function activated. The most time-consuming task is blocking or deleting thousands of unwanted commercials, usually sent by bots. But after all, the primary and most important mission is to be in touch with visitors who leave comments. They can often be unpleasant, sometimes enthusiastic, and rarely initiate constructive discussion. But only interactions build solid relations and engagement. 

To be clear, I do not suggest authorizing anonymous visitors to write uncensored comments. 

There are blogs with the function of active comments, and visitors do not utilize them. It also concerns my blog. I published one hundred articles that were seen over one hundred thousand times, and as a response, I got only forty visitors’ comments. I am not very happy with that, but my goal is to share my experience, not monetize my work. And I wrote all articles because it was my desire, not of my visitors. The dealership’s blog should contain articles containing answers to customers’ problems presented on social media (I explained it here) or brought from construction sites by salespeople and aftersales representatives or technicians. Then blog readers will engage, I hope.

The number of manufacturers’ blogs is meager, and it is not easy to find them. The number of articles on existing blogs is not satisfactory. For example, Caterpillar presents only about thirty items on their Construction Blog. More articles they have in the section called Articles by Experts. In my opinion, those are not answers to questions customers are ashamed to ask. 

I am afraid construction equipment dealers neglect the idea of sustaining communication with their best agents – machine operators and another construction site influential personnel. Why do they not use the cheapest channel, i.e., social media and blogs?

How do you learn about customers’ perception of the quality of your sales and aftersales services? What do they think about the quality of your communication channel? Are you already genuinely subscribed to the idea of engagement marketing?

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A Force To Be Reckoned With

A Force To Be Reckoned With

Our new guest writer Dave Gordon is currently the Executive Director of the Independent Equipment Dealers Association where he has been on board for 18 months. His experience includes more than 35 years of leadership experience in strategy, sales, marketing and financial issues, as well as distribution development for manufacturers. Dave spent his early years at AED as the Director of Membership, then later became Vice President of Sales/CONDEX and served as the Publisher of AED’s monthly magazine Construction Equipment Distribution. Dave current lives in Westchester, his hometown where he grew up, just fifteen minutes west of the city of Chicago. In his first blog post for Learning Without Scars, Dave Gordon writes about a force to be reckoned with…

Taking a pass on your trade association? Here’s what you – and your team – are missing out on.

A long time ago in a place far away – queue the scrolling Star Wars intro – I was trying to recruit a construction equipment company on the East Coast to join the association I worked at for 30 years, Associated Equipment Distributors (AED). It was the early 1990s, before the advent of sophisticated CRM systems, emails, and e-newsletters – so, plugging away with all the “old tools” at my disposal, I’d been after this guy for some four months. 

I will say he was a formidable “opponent,” silent for long stretches and then, if I happened to catch him on the phone, quick with an objection to nearly every argument I presented. In the end, I believe the primary reason he finally joined was to put a stop to all my calls, notes, and mailed information! 

But here’s the thing: Once I convinced him to become a member, that dealer principal jumped in with both feet! He attended every meeting, he served as a director and eventually became chairman, the highest volunteer position. On several occasions, he told me his active participation had been one of the most rewarding business and personal experiences he ever had. The connections he had developed became lifelong friendships. 

I could tell literally dozens if not hundreds of similar stories – bringing business owners and their employees into the family of their industry’s trade association has been a chief hallmark of my career. Sometimes it took me well over a year to “win the fight,” so you can imagine the frustration when, once in a while, someone would drop their membership after just one dues-billing cycle! 

The fact is, while some owners prioritize and fully immerse themselves in all the benefits of membership, others succumb to their own busyness and give up before thinking it all the way through. Perhaps the No. 1 objection about associations I’ve heard over the years is this: “You guys are doing a great job, but I just don’t have the time to read anything or to attend meetings.”

And look, I get it – you’ve got a business to run and a bottom line to grow. But in my experience, that mindset is likely to backfire on you eventually. That view of associations overlooks one important thing, and in today’s labor market, it may be the most crucial consideration: your people. Association membership enables you to offer resources to your team that help grow them professionally, and that, my friend, will absolutely help grow your bottom line. Industry-specific education, webinars, conferences, reports and publications, along with networking events – these are the tools needed to grow and maintain a successful business. 

So, while you may initially feel the same overwhelm you get with the daily newspaper subscription that you just can’t keep up with, a better way to approach your association membership is like the all-you-can-eat buffet: You have to pace yourself, be discerning, and choose the opportunities that can help you with your specific business issues.

And remember, it’s not just about you. You definitely want to get as many members of your team involved as possible. Most corporate memberships allow your staff to take advantage of the full array of benefits, so my advice is: Get them all on the mailing list!

Coming together with other companies within your industry creates a world of opportunities you wouldn’t otherwise have access to on your own. The benefits of membership in a trade organization can be different for everybody, but here are four that could make a big difference for you. 

1. Training & Education

Training and education are mission critical to maintaining a competitive edge in any industry. Having the best and brightest employees is positively essential for growing your business. Investing in your employees helps retain them, and they’re likely to be far more productive. 

Most trade associations offer industry-specific seminars, workshops, and classes to help you learn and grow, with subjects ranging from sales to rentals to parts and service. Other training may include high-level topics for owners, CFOs and general managers.

2. Networking

Trade organizations offer a great way to connect with others in your industry whose businesses are like yours, and they face the same day-to-day problems you might be experiencing. Naturally, you probably don’t want to discuss strategic or operational issues with a neighboring competitor – the beauty of your association’s national membership is that you’ve got out-of-state “friends and family” to call upon, business peers who can share their experiences and either help you explore new ideas or connect you with someone they know who has had and solved the same problem.

3. Industry Trends

If there’s one thing that’s been constant throughout my 35 years in the construction equipment distribution industry, it’s change. Through the highs and lows of the economy, the roll-up of many dealers by the national rental companies, and the consolidation of many dealers, being a part of a trade association will keep you informed on all the emerging trends, economic data, and business tips to help you survive and thrive. 

4. Advocacy

Several trade associations lobby the government on behalf of their industries. Many of these issues can have a direct impact on your business, so joining forces with other members in the organization can certainly be more effective at the federal and state levels than going it alone. Even if you prefer not to have a direct, personal role, you’ll be kept up to date on what legislative issues are being argued on your behalf. 

At the end of day, belonging to an association isn’t a threat to your entrepreneurial spirit or your proprietary ways of running your business – instead, it’s an enhancement to you and your company. Association membership gives you what you probably can’t achieve on your own, multiplying available resources, fostering ideas, and cultivating relationships that enrich you and your employees professionally and personally.

If ever you’ve battled against the “fear of missing out,” now is the time lay down your weapons and feel it in full force! Because where associations are concerned, I cannot begin to count the competitive advantages missed by those who choose to tough it out on their own in these bizarre and uncertain economic times. May the force of association membership be with you! 

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