how do sales and merchandising skills affect parts profitability

Understanding how do sales and merchandising skills affect parts profitability is essential for any dealership or service operation aiming to improve margins. Many parts departments focus heavily on inventory levels and pricing, yet overlook the direct influence of human skills and product presentation. In reality, sales expertise and merchandising strategy are often the deciding factors between average performance and sustained profitability.

At Learning Without Scars, the emphasis is on developing these core competencies to help parts teams move beyond transactional selling into strategic revenue generation. When teams combine strong counter sales skills with effective merchandising, the result is increased customer satisfaction and higher profit per transaction.

The Link Between Sales Skills and Profitability

Sales skills directly impact how parts are recommended, explained, and ultimately sold. A knowledgeable and confident parts professional can transform a simple request into a higher-value transaction.

For example, a customer may ask for a single replacement part. A skilled team member identifies related needs and suggests complementary items. This is not aggressive selling but informed service.

Key Ways Sales Skills Drive Profit

  • Increased average transaction value
  • Higher customer retention
  • Better product understanding and recommendations
  • Improved trust and long-term relationships

Strong counter sales skills ensure that customers feel guided rather than pressured. This approach leads to repeat business, which is more profitable than constantly acquiring new customers.

The Role of Merchandising in Parts Departments

Merchandising is often underestimated in parts operations. However, effective inventory presentation can significantly influence purchasing decisions.

Customers are more likely to buy products that are easy to see, understand, and access. Clear labeling, logical arrangement, and visual appeal all contribute to improved sales performance.

Elements of Effective Parts Merchandising

Element Impact on Profitability
Clear product displays Encourages impulse purchases
Organized shelving Reduces time to locate items
Strategic product placement Highlights high-margin items
Clean environment Builds trust and professionalism

Applying parts merchandising best practices ensures that every square foot of the parts department contributes to revenue generation.

Combining Sales and Merchandising for Maximum Impact

Sales and merchandising are most powerful when they work together. A well-presented product becomes even more appealing when supported by knowledgeable staff.

For instance, a visually highlighted product combined with a confident recommendation increases the likelihood of purchase. This synergy creates a seamless customer experience.

CSA for Parts Managers: A Structured Approach

One effective framework is CSA for parts managers, which stands for Customer, Sales, and Availability. This approach aligns daily operations with profitability goals.

Customer Focus

Understanding customer needs ensures relevant recommendations. Listening is just as important as selling.

Sales Execution

Sales techniques should focus on value rather than price. This includes explaining benefits and applications.

Availability Management

Products must be in stock and easy to find. Even the best sales effort fails if the item is unavailable.

Upselling Parts Ethically

Upselling often carries a negative perception. However, upselling parts ethically is about helping customers make better decisions.

Ethical upselling involves:

  • Recommending genuinely useful products
  • Explaining why additional items are beneficial
  • Avoiding unnecessary or irrelevant suggestions

When done correctly, upselling improves both customer satisfaction and profitability.

Inventory Presentation as a Sales Tool

Inventory is not just a cost center. It is a sales tool. Effective inventory presentation turns stock into opportunity.

Consider the difference between a cluttered shelf and a clearly labeled display. The latter invites exploration and increases purchase likelihood.

Best Practices for Inventory Presentation

  • Group related products together
  • Use signage to highlight features and benefits
  • Maintain cleanliness and organization
  • Rotate stock to keep displays fresh

These simple changes can significantly improve sales outcomes without increasing inventory costs.

Training and Development with Learning Without Scars

Continuous training is essential for maintaining high performance. Learning Without Scars focuses on practical skill development tailored to parts professionals.

Their programs emphasize:

  • Real-world sales scenarios
  • Merchandising techniques that drive results
  • Customer-focused communication strategies

Investing in training ensures that teams stay competitive and adaptable in a changing market.

Measuring the Impact on Profitability

To understand how do sales and merchandising skills affect parts profitability, it is important to track key metrics.

Key Performance Indicators

  • Average transaction value
  • Gross profit margin
  • Inventory turnover
  • Customer retention rate

Improving these metrics often starts with better sales conversations and more effective merchandising strategies.

Common Mistakes to Avoid

Even experienced parts departments can fall into common traps.

Lack of Training

Without ongoing development, skills stagnate. This leads to missed opportunities.

Poor Store Layout

Disorganized spaces reduce efficiency and discourage purchases.

Overemphasis on Price

Focusing only on price reduces margins. Value-based selling is more effective.

Creating a Customer-Centric Experience

Customers expect more than just parts availability. They want guidance, clarity, and confidence in their purchase.

By combining strong counter sales skills with thoughtful merchandising, parts departments can create a positive and memorable experience.

This approach leads to:

  • Increased loyalty
  • Higher lifetime value
  • Stronger brand reputation

Future Trends in Parts Sales and Merchandising

The parts industry is evolving. Digital tools and data analytics are becoming more important.

However, human skills remain critical. Technology can support sales, but it cannot replace the trust built through personal interaction.

Conclusion

The answer to how do sales and merchandising skills affect parts profitability lies in their ability to influence every customer interaction. From the moment a customer enters the parts department to the final transaction, these skills shape outcomes.

By adopting parts merchandising best practices, improving counter sales skills, and focusing on upselling parts ethically, organizations can unlock significant profit potential.

With structured approaches like CSA for parts managers and ongoing training from Learning Without Scars, parts departments can move from average performance to sustained success. Contact for more information.

FAQs

1. How do sales and merchandising skills affect parts profitability?

They increase transaction value, improve customer satisfaction, and enhance product visibility, leading to higher overall revenue.

2. What are parts merchandising best practices?

They include organized displays, clear labeling, strategic product placement, and maintaining a clean environment.

3. What is CSA for parts managers?

It stands for Customer, Sales, and Availability, a framework to align operations with profitability goals.

4. How can upselling parts be done ethically?

By recommending relevant products that genuinely benefit the customer and clearly explaining their value.

5. Why is inventory presentation important?

It influences buying decisions, improves accessibility, and helps highlight high-margin products.

Top Dealer Workforce Training Trends

The dealer workforce training trends 2026 are reshaping how dealerships build skilled, adaptable teams. As industries evolve with digital transformation, dealerships must rethink how they train technicians, parts specialists, and service professionals.

Traditional training methods are no longer enough. Today, businesses rely on flexible learning systems, data-driven tools, and continuous development strategies. Organizations like Learning Without Scars are leading this transformation by offering structured and modern training solutions.

In this article, we explore the top seven trends that are redefining workforce development in 2026 and how dealerships can stay competitive.

1. Rapid Growth in Online Learning Adoption

One of the most significant dealer workforce training trends 2026 is the surge in online learning adoption. Digital platforms allow employees to learn anytime, anywhere.

This shift has several benefits. First, it reduces downtime by allowing technicians to train between tasks. Second, it ensures consistent training across multiple locations. Finally, it supports personalized learning paths.

For example, dealerships can assign targeted modules based on employee roles. A parts manager can focus on inventory systems, while a technician learns diagnostics.

In addition, online platforms often include tracking systems. Managers can monitor progress, completion rates, and performance metrics. This data-driven approach improves accountability and results.

2. Increasing Importance of CEUs for Career Growth

The CEUs importance in dealer training continues to grow. Continuing Education Units provide measurable proof of professional development.

Employees now expect more than just a job. They want career progression. CEUs help them demonstrate skills and qualify for advanced roles.

From a business perspective, offering CEU-based programs improves retention. Employees feel valued when their growth is supported.

Moreover, structured certification programs help standardize knowledge across the workforce. This consistency leads to better service quality and customer satisfaction.

3. Integration of Advanced Tech in Education

The role of tech in education has expanded significantly in 2026. Training is no longer limited to manuals or classroom sessions.

Modern dealerships use interactive tools such as:

  • Virtual simulations
  • Augmented reality (AR)
  • Mobile learning apps

These tools enhance engagement and improve knowledge retention. For example, a technician can practice equipment repairs in a virtual environment before working on real machines.

Additionally, mobile-friendly platforms ensure that training is accessible on smartphones and tablets. This flexibility is essential for today’s fast-paced work environments.

4. Rise of AI Training Tools

Artificial intelligence is transforming how employees learn. AI training tools provide personalized learning experiences based on individual performance.

These tools analyze user behavior and adapt content accordingly. If an employee struggles with a topic, the system offers additional resources or simplified explanations.

AI also enables predictive learning. It identifies skill gaps before they become problems. This proactive approach improves efficiency and reduces errors.

Another advantage is automation. AI can handle assessments, grading, and feedback. This reduces administrative workload and allows trainers to focus on strategic development.

5. Growing Role of Telematics in Training

Telematics is becoming a powerful tool in workforce development. It collects real-time data from equipment and vehicles.

This data helps identify training needs. For instance, if a machine shows repeated errors, employees can be trained to address those specific issues.

Telematics also supports performance monitoring. Managers can evaluate how employees interact with equipment and identify areas for improvement.

By combining telematics data with training programs, dealerships can create highly targeted learning strategies. This approach improves productivity and reduces operational risks.

6. Strong Focus on Accreditation Value

The accreditation value of training programs has become a key consideration in 2026. Businesses want assurance that their training investments deliver measurable outcomes.

Accredited programs meet industry standards and provide recognized credentials. This adds credibility to both employees and organizations.

For employees, accreditation enhances career prospects. For employers, it ensures consistent training quality.

Learning Without Scars, for example, emphasizes structured and accredited programs that align with industry needs. This ensures that training is both relevant and effective.

7. Shift Toward Continuous Learning Culture

The final major trend is the move toward continuous learning. Training is no longer a one-time event. It is an ongoing process.

Dealerships are building learning cultures where employees regularly update their skills. This approach helps organizations adapt to industry changes.

Continuous learning also improves employee engagement. Workers feel more confident and capable when they are consistently developing their skills.

In addition, it supports innovation. Employees who learn regularly are more likely to suggest improvements and adopt new technologies.

📊 Table: Key Trends and Business Impact

Trend Key Benefit Business Impact
Online learning adoption Flexible training Higher completion rates
CEUs importance Career development Improved retention
Tech in education Interactive learning Better engagement
AI training tools Personalized learning Faster skill development
Telematics Data-driven insights Reduced errors
Accreditation value Credibility Consistent standards
Continuous learning Ongoing improvement Long-term growth

How Dealerships Can Adapt to These Trends

To stay competitive, dealerships must take a proactive approach. First, invest in digital learning platforms that support scalability. Second, integrate AI and telematics into training strategies.

Next, focus on structured programs that include CEUs and accreditation. This ensures both employee satisfaction and business performance.

Finally, create a culture of continuous learning. Encourage employees to update their skills regularly and provide access to modern training tools.

This resource offers industry-focused training designed to meet modern workforce demands.

Conclusion

The dealer workforce training trends 2026 highlight a clear shift toward technology-driven, flexible, and continuous learning systems. From online learning adoption to AI training tools and telematics, these trends are transforming how dealerships operate.

At the same time, the CEUs importance and accreditation value emphasize the need for structured and credible training programs.

Dealerships that embrace these changes will build stronger teams, improve efficiency, and stay ahead in a competitive market. The future of workforce development is already here, and now is the time to act. Contact us to get expert guidance.

FAQs

1. What are the key dealer workforce training trends 2026?

The main trends include online learning adoption, AI training tools, telematics integration, and a strong focus on continuous learning and accreditation.

2. Why is online learning important for dealerships?

Online learning provides flexibility, improves accessibility, and allows employees to train without disrupting daily operations.

3. How do AI training tools improve workforce development?

AI tools personalize learning, identify skill gaps, and automate assessments, making training more efficient and effective.

4. What is the role of CEUs in dealer training?

CEUs help track professional development, support career growth, and improve employee retention.

5. Why does accreditation value matter in training programs?

Accreditation ensures quality, builds credibility, and provides recognized certifications that benefit both employees and employers.

Skill assessments employee

Skill assessments employee retention strategies are becoming essential as employee turnover remains one of the biggest challenges facing parts and service teams today. Skilled technicians, parts specialists, and service advisors are in high demand, and losing even one experienced employee can disrupt operations and reduce profitability. This is where targeted assessments play a critical role.

Organizations that use these strategies not only understand their workforce better but also build stronger engagement, clearer career paths, and more effective training. As a result, employees feel valued and are more likely to stay.

In this article, Learning Without Scars explores five powerful ways targeted skill assessments improve retention and strengthen your team’s long-term success.

Why Skill Assessments Matter for Retention

Before diving into the strategies, it is important to understand why assessments are so impactful.

Many organizations rely heavily on traditional employee performance reviews, which often focus on past performance rather than future growth. While reviews are useful, they do not always uncover skill gaps or development opportunities.

Skill assessments, on the other hand, provide measurable insights into what employees know, what they need to learn, and how they can grow. This forms the foundation of effective retention best practices.

For example, when employees see a clear path for improvement and advancement, they are far less likely to seek opportunities elsewhere.

1. Identifying Skill Gaps with Precision

One of the most effective uses of skill assessments is identifying gaps in knowledge and performance.

Without structured skill mapping, managers often rely on assumptions. This can lead to misaligned training programs or missed opportunities to upskill employees.

Targeted assessments solve this problem by offering data-driven insights.

How This Improves Retention

When employees struggle without support, frustration builds quickly. Over time, this leads to disengagement and eventually turnover.

However, when skill gaps are clearly identified:

  • Employees receive relevant training
  • Managers provide better guidance
  • Teams operate more efficiently

This clarity reduces stress and builds confidence across the workforce.

2. Creating Personalized Development Plans

Generic training programs rarely deliver strong results. Every employee has different strengths, weaknesses, and career goals.

Skill assessments make it possible to create tailored development plans that align with individual needs.

Example of a Personalized Approach

Employee Role Identified Gap Development Plan Action
Service Technician Diagnostic skills Advanced troubleshooting training
Parts Specialist Inventory management Process optimization course
Service Advisor Customer communication Soft skills coaching

How This Improves Retention

Employees are more likely to stay when they feel their employer invests in their growth.

Personalized plans:

  • Show commitment to employee success
  • Increase job satisfaction
  • Encourage long-term career development

In addition, they turn training into a meaningful experience rather than a routine task.

3. Enhancing Employee Performance Reviews

Traditional employee performance reviews often lack objectivity. They may depend on manager opinions rather than measurable data.

Skill assessments add a layer of accuracy and fairness.

Key Benefits

  • Objective evaluation of skills
  • Clear benchmarks for improvement
  • Consistent performance standards

How This Improves Retention

Employees want fair and transparent evaluations. When reviews are backed by real data:

  • Trust in management increases
  • Feedback becomes actionable
  • Employees feel recognized for their abilities

As a result, engagement improves, and employees are less likely to leave due to dissatisfaction.

4. Supporting Career Progression and Internal Mobility

One of the most overlooked retention best practices is providing clear career pathways.

Employees often leave not because they dislike their job, but because they do not see a future within the organization.

Skill assessments help map out those future opportunities.

The Role of Skill Mapping

With structured skill mapping, organizations can:

  • Identify high-potential employees
  • Match skills to future roles
  • Plan promotions strategically

How This Improves Retention

When employees understand what it takes to advance:

  • Motivation increases
  • Career goals become clearer
  • Loyalty to the organization strengthens

Instead of looking outside, employees focus on growing within the company.

5. Building a Culture of Continuous Learning

A strong learning culture is essential for long-term retention.

Skill assessments encourage continuous improvement by regularly evaluating progress and identifying new learning opportunities.

Key Elements of a Learning Culture

  • Ongoing assessments
  • Regular feedback loops
  • Updated training programs

How This Improves Retention

Employees who learn continuously are more engaged and adaptable.

They also:

  • Feel more confident in their roles
  • Stay updated with industry trends
  • Experience greater job satisfaction

This creates a workplace where employees want to stay and grow.

Practical Implementation Tips

To fully benefit from skill assessments employee retention strategies, organizations need a structured approach.

Start with Clear Objectives

Define what you want to achieve. For example:

  • Reduce turnover
  • Improve productivity
  • Enhance customer satisfaction

Use Reliable Assessment Tools

Choose tools that provide accurate and actionable insights.

Integrate with Training Programs

Ensure assessment results directly influence development plans and training initiatives.

Monitor and Adjust

Retention strategies should evolve. Regularly review results and refine your approach.

Common Challenges and How to Overcome Them

Even the best strategies can face obstacles.

Resistance to Change

Some employees may feel nervous about assessments.

Solution: Communicate clearly that assessments are for growth, not punishment.

Lack of Time

Busy service environments may struggle to allocate time.

Solution: Use short, targeted assessments that fit into daily workflows.

Inconsistent Implementation

Without consistency, results may vary.

Solution: Standardize processes across teams.

The Long-Term Impact on Parts & Service Teams

When implemented correctly, skill assessments employee retention strategies deliver measurable benefits.

Key Outcomes

  • Lower turnover rates
  • Higher employee engagement
  • Improved service quality
  • Stronger team performance

Over time, these improvements lead to better customer satisfaction and increased profitability.

Conclusion

Retention is not just about keeping employees. It is about creating an environment where they want to stay and grow.

By using targeted skill assessments, organizations can:

  • Identify gaps
  • Build personalized development plans
  • Improve employee performance reviews
  • Support career growth through skill mapping
  • Strengthen overall retention best practices

These strategies transform the workplace into a more supportive, engaging, and productive environment.

If you want to reduce turnover and build a stronger team, now is the time to invest in structured assessment strategies. For more information contact us.

FAQs

1. What are skill assessments in employee retention strategies?

Skill assessments are tools used to evaluate employee knowledge and abilities. They help identify gaps and support targeted training to improve retention.

2. How do skill assessments improve employee performance reviews?

They provide objective data, making reviews more accurate, fair, and actionable for both employees and managers.

3. What is skill mapping and why is it important?

Skill mapping identifies current skills and future requirements. It helps align employees with roles and supports career growth.

4. How often should skill assessments be conducted?

Ideally, assessments should be conducted regularly, such as quarterly or biannually, to track progress and update development plans.

5. Can small teams benefit from skill assessments?

Yes, even small teams benefit by improving efficiency, identifying training needs, and increasing employee satisfaction.

Service Management CSA

Understanding how Service Management CSA improves leadership is essential for organizations aiming to achieve consistent service excellence. In today’s competitive environment, leadership is no longer just about authority. It is about guiding teams, improving performance, and aligning service delivery with business goals.

Service Management CSA, as emphasized by Learning Without Scars, acts as a structured approach to bridge the gap between leadership intent and operational execution. It equips leaders with tools to evaluate performance, build service leadership skills, and create meaningful employee development plans.

As a result, organizations can move from reactive management to proactive leadership.

What Is Service Management CSA?

Service Management CSA stands for a structured Capability and Skills Assessment framework. It focuses on evaluating team performance, identifying gaps, and aligning workforce capabilities with organizational goals.

This framework integrates three key elements:

  • Performance assessment
  • Employee development plans
  • Advancement pathways

Rather than relying on guesswork, CSA provides measurable insights into how teams function. Leaders can then make informed decisions to improve service quality.

Why Leadership Needs a Structured Approach

Leadership in service environments is complex. Teams face constant pressure to deliver faster and better outcomes. Without a clear framework, leaders often struggle to identify what needs improvement.

This is where how Service Management CSA improves leadership becomes evident.

CSA helps leaders:

  • Understand team strengths and weaknesses
  • Align roles with business needs
  • Improve accountability across teams

In addition, it creates transparency. Employees understand expectations, and leaders gain clarity on performance.

How Service Management CSA Improves Leadership

1. Enhances Service Leadership Skills

CSA frameworks are designed to strengthen service leadership skills. Leaders learn how to manage teams based on data rather than assumptions.

For example, performance metrics highlight areas where leadership intervention is required. This allows leaders to focus on coaching instead of micromanaging.

As a result, leaders become facilitators of growth rather than controllers of tasks.

2. Improves Performance Assessment Accuracy

Traditional performance reviews are often subjective. CSA replaces this with structured performance assessment methods.

These assessments:

  • Use measurable benchmarks
  • Provide consistent evaluation criteria
  • Reduce bias in decision-making

Because of this, leaders can identify real performance gaps. They can also recognize high performers more effectively.

3. Supports Employee Development Plans

A key benefit of CSA is its focus on employee development plans. Instead of generic training, development becomes targeted and purposeful.

Leaders can:

  • Identify skill gaps
  • Assign relevant training programs
  • Track improvement over time

This approach increases employee engagement. It also ensures that training investments deliver real value.

4. Creates Clear Advancement Pathways

Employees often feel uncertain about career growth. CSA addresses this by defining advancement pathways.

These pathways:

  • Show employees what skills are needed for promotion
  • Align individual goals with organizational objectives
  • Improve retention by offering growth opportunities

Leaders benefit because motivated employees perform better and stay longer.

The Connection Between Leadership and Service Excellence

Service excellence depends on consistent leadership. Without strong leadership, even skilled teams struggle to perform.

CSA strengthens this connection by:

  • Aligning leadership goals with service outcomes
  • Providing tools to measure progress
  • Encouraging continuous improvement

In addition, it fosters a culture of accountability. Teams understand their role in delivering quality service.

Practical Implementation of Service Management CSA

Implementing CSA requires a structured approach. Organizations should follow these steps:

Step 1: Define Competency Standards

Start by identifying the skills required for each role. This forms the foundation of the CSA framework.

Step 2: Conduct Performance Assessment

Evaluate employees based on defined standards. Use data to ensure accuracy.

Step 3: Develop Employee Plans

Create personalized employee development plans based on assessment results.

Step 4: Monitor Progress

Track improvements regularly. Adjust strategies as needed.

Service Management CSA Framework Overview

Component Purpose Leadership Impact
Performance Assessment Measure employee capabilities Improves decision-making
Employee Development Plans Address skill gaps Enhances team performance
Advancement Pathways Define career growth Increases retention
Continuous Monitoring Track progress Ensures long-term success

Benefits for Organizations

Organizations that adopt CSA frameworks experience multiple benefits.

First, they achieve better alignment between leadership and operations. Second, they improve employee satisfaction through clear growth opportunities.

In addition, CSA supports:

  • Higher service quality
  • Reduced turnover
  • Improved productivity

These outcomes contribute directly to business success.

Role of Learning Without Scars

Learning Without Scars emphasizes practical learning and real-world application. Their approach to Service Management CSA focuses on measurable outcomes.

Their training helps leaders:

  • Build service leadership skills
  • Implement effective performance assessment systems
  • Design impactful employee development plans

Challenges and How to Overcome Them

While CSA offers many benefits, implementation can be challenging.

Common Challenges

  • Resistance to change
  • Lack of data-driven culture
  • Limited leadership training

Solutions

Organizations should:

  • Communicate the benefits clearly
  • Provide leadership training
  • Use simple tools to track progress

With the right approach, these challenges can be managed effectively.

Future of Service Leadership with CSA

The future of service leadership lies in structured frameworks like CSA. As industries evolve, leaders must rely on data and continuous learning.

CSA supports this shift by:

  • Encouraging adaptability
  • Promoting skill development
  • Enhancing leadership effectiveness

Therefore, organizations that adopt CSA early will have a competitive advantage.

Conclusion

Understanding how Service Management CSA improves leadership is critical for organizations aiming to achieve service excellence. By integrating performance assessment, employee development plans, and advancement pathways, CSA creates a strong foundation for effective leadership.

Leaders become more informed, teams become more engaged, and service outcomes improve significantly.

With guidance from Learning Without Scars, organizations can successfully implement CSA and transform their leadership approach. Contact now.

FAQs

1. What is Service Management CSA?

Service Management CSA is a framework that evaluates skills, improves performance, and aligns employee development with business goals.

2. How Service Management CSA improves leadership?

It provides data-driven insights, enhances service leadership skills, and supports structured decision-making.

3. Why is performance assessment important in CSA?

Performance assessment ensures accurate evaluation of employee capabilities and helps identify areas for improvement.

4. How do employee development plans benefit organizations?

They improve employee skills, increase engagement, and contribute to better service outcomes.

5. What are advancement pathways in CSA?

Advancement pathways define clear career growth opportunities, helping employees understand how to progress within the organization.

“Natural/unnatural” and “good/bad” are orthogonal axes

A Paper by Sam Matey Coste

From personal conversations to news articles to regulatory standards to cultural depictions of technology, this writer has found that the world would be much better served if more people took the time to subject their thinking to a simple test: if a new technology seems dystopian, consider what it’s replacing. Intertwined with this, I’d like to posit another rule of thumb: if a primary argument against something new is that it’s “unnatural,” that’s a good sign that it’s probably not actually bad.

Very often, media coverage and intuitive personal responses to new technologies boil down to “it’s unnatural/new/strange, therefore it’s bad.” From solar farms to self-driving cars to next-generation vaccines, we regularly hear “unnatural” (or similar forms like “industrial”) used as an attack against new ideas and tools, as if that accusation alone formed a meaningful argument. This causes a lot of problems and unnecessarily slows down a wide range of positive change.

First, let’s try to define our terms for the purpose of this article.

For “good” and “bad,” while endlessly debatable on the margins, I’m going with the effective global consensus definition as neatly expressed by Steven Pinker in Enlightenment Now.

“Most people agree that life is better than death.

Health is better than sickness.
Sustenance is better than hunger.
Wealth is better than poverty.
Peace is better than war.
Safety is better than danger.
Freedom is better than tyranny.
Equal rights are better than bigotry and discrimination.
Literacy is better than illiteracy.
Knowledge is better than ignorance.
Intelligence is better than dull wittedness.
Happiness is better than misery.

Opportunities to enjoy family, friends, culture, and nature are better than drudgery and monotony.”— Enlightenment Now, Steven Pinker

As for “natural,” that’s arguably a bit more complicated. There’s a school of thought that holds that since humans are animals that evolved on Earth, everything we create is “natural” because it’s an extended phenotype of a species, like a beaver dam or a termite mound. This is arguably true in a philosophical sense, but it’s a bit word-gamey; that’s just not what most people mean when they talk about something being “natural.”

So, let’s leave aside the “skyscraper = termite mound” argument and explore the commonly understood “human technology is unnatural” terminology. I’m pretty sure most people talking about “unnatural” technology don’t want to go back to dowsing for ants with sticks like a chimpanzee group. You do sometimes see people making spirited “degrowth”-style arguments about the superiority of Paleolithic-level hunter-gathering or medieval-level subsistence farming as a lifestyle1, but these tend to founder pretty hard when confronted with the absence of absolutely critical standard of living improvements like “indoor plumbing” or “smallpox vaccines” or “C-sections to prevent death by childbirth.”

So, let’s be maximally charitable to the “technology is unnatural” argument and say that some kind of technological civilization is okay, but newer or more recent technologies are particularly “unnatural.” Well, one of the first things that I notice is that the goalposts seem to keep shifting on exactly what time horizon saw the crossover from “natural human technology” to “unnatural human technology.” In communication technology, for example, the Internet was once widely considered unnatural2, and TV before that, and cheaply printed novels before that. This writer suspects that most people’s actual working intuitive standard of naturalness is basically that “human technology that changes things from the way they were when I was a child is unnatural.” This XKCD comic and these Douglas Adams and Terry Pratchett quotes explore relevant examples.

One could add a panel in 320 BC detailing how Socrates detested writing for destroying the memory…

1. Anything that is in the world when you’re born is normal and ordinary and is just a natural part of the way the world works.

2. Anything that’s invented between when you’re fifteen and thirty-five is new, exciting, and revolutionary and you can probably get a career in it.

3. Anything invented after you’re thirty-five is against the natural order of things.”

– Douglas Adams.

‘Not natural, in my view…Not in favor of unnatural things. Do you mean, you eat your meat raw and sleep in a tree?

Terry Pratchett, The Fifth Elephant.

In particular, this is a common “failure mode” this writer sees in responses to discussion of new technologies that can solve big problems, but in an “unnatural” way, from the comparatively well-accepted but still under-attack genetically modified crops, solar power, and mRNA vaccines to hotly-debated issues like cell-cultivated meat and self-driving cars to the “still pretty far out” stuff like geoengineering or even artificial wombs. All of these technologies can sound scary and dystopian to some people, but I believe that the evidence is overwhelming that all of these have at least the potential to be a substantial improvement than the status quo, and we should therefore support and accelerate the process of researching, developing, testing, refining, optimizing, and eventually deploying them.

Here’s what this kind of “anti-unnatural bias” can look like in practice. When this writer brings up any of the many awesome new meat replacement technologies—even something as innocuous as the plant-based Beyond Burger, let alone the new frontier of cell-cultivated meat(—)a lot of people have an immediate negative reaction, expressing fear, disgust, or apprehension at such an “unnatural” future. This is often from the very same people who care a lot about animals, who are vegetarian or vegan for ethical reasons, and/or have strong opinions about enforcing animal welfare in farms.

That is, to put it gently, an extremely incoherent position to hold. Cultivated meat isn’t a dystopian future, factory-farmed meat is a dystopian present!

The world is full of such examples of “ignoring the dystopian present.”

In the present, right now, over 8.9 billion chickens, 66 million cows and 71 million pigs are factory-farmed in  the United States alone.

1.35 million humans per year, or almost 3,700 per day, are killed in collisions and crashes on Earth’s roadways, currently dominated by human-driven cars.

As of 2019, about 900,000 human babies per year died due to being born preterm.

It seems to this writer that given these conditions as the status quo, we should default to being in favor of accelerating the development and deployment of cell-cultivated meat, self-driving cars, and artificial wombs! And the same holds for lots and lots of other cases, including practically all of the medical research and clean energy fields given vast death tolls from disease and air pollution.

Self-driving cars (which are proving to be safer) aren’t a dystopian future, mass deaths from car crashes are a (relatively) dystopian present.

Spreading solar farms sheltering biodiversity aren’t a dystopian future, deaths from air pollution and escalating global warming is a dystopian present.

Injecting weird-sounding mRNA vaccines isn’t a dystopian future, dying of preventable diseases is a dystopian present.

We have many, many opportunities to build a much better world, and speeding up that process makes a huge difference for vast numbers of lives! And yet many people in developed countries these days, if not most, seem to have an attitude ranging from ambivalence to negativity towards transformative new technologies. Even world-improving technologies like renewable energy and vaccines that have clearly proven their manifest value over and over again still face disturbingly widespread bands of die-hard opponents. The most “anti-technology” elements of the political “left” and “right” have formed an unholy alliance that now runs the United States government and is actively attacking science, research, and innovation across the board.

Over and over again, new technologies, conditions, and systems are held to a disproportionately high standard, while existing technologies, conditions, and systems, even when they kill thousands or torture millions every year, are accepted as “that’s just the way it is.” We find it much easier to fear hypothetical dystopian futures than to acknowledge real-life dystopian presents. There are probably a lot of understandable psychological reasons for this; we’d probably go insane if we tried to truly comprehend all the suffering in the world. You can’t live a life like that.

Globally 4.3% of all children die before they are 15 years old. – The world is awful.
Ine the past around 50% of all children died. Today 4.3% of all children do. – The world is much better.
Globally 4.3% of all children die. In the European Union 0.45% of all children die. – The world can do much better.

From Our World in Data.

But humanity has demonstrated an extraordinary potential to make the world a much, much better place, particularly since the dawn of our emerging Earth-born technological civilization. The “dystopian present” is often a substantial improvement on an even worse past and can become better still in the future. Quite often, major positive changes are caused by “unnatural” new systems and technologies, however you define that. That intersection of “good” and “unnatural” is one of the things I try to write about in my newsletter, from wildlife thriving in human-dominated urban landscapes to advanced clean energy bringing abundant power while benefiting biodiversity to incredible new medical developments improving the lives of millions.

Of course, new things sometimes cause brand-new problems, from leaded gasoline poisoning to thalidomide babies to rapid-onset human-caused climate change (burning fossil fuels was new once, too). It may seem like a “cheat” to praise “unnatural” new technologies like renewable energy and cell-cultivated meat for helping solve the problems of the fossil fuel industry and factory farming. Fossil fuels and factory farming were themselves once widely considered “unnatural” new technologies fighting to help solve the problems of dire energy poverty and food poverty being the base state of most of humanity. But those were really big problems, and the new technologies did, in fact, mostly solve them, at least compared to preindustrial norms. They then created new problems, which I think new technologies are on track to solve in their turn.

Basically, what I’m trying to say is that “good/bad” and “natural/unnatural” are differentthings, and new, scary seeming “unnatural” things often turn out to be very good for humanity. That’s very different from saying that anything new or unnatural is by definition good. It’s just a call to judge things more on the “good/bad” axis and less on the “natural/unnatural” axis, because “natural/unnatural” is a pretty terrible proxy for “good/bad!”

 

A quick visual aid I whipped up to help illustrate what I’m talking about. Note that I’m only intending to use this as a four-quadrant qualitative categorization, not a quantitative differentiation within quadrants.

1. Cancer, malaria, smallpox, intestinal parasites, infanticide, and war3 are all totally natural, in the sense that they existed before Homo sapiens, but they’re bad!
2. Solar panels, flush toilets, mRNA vaccines, weather forecasting, and AI-designed medicines are all deeply unnatural, in the sense that they’re made by humans and don’t resemble pre-human items or processes, but they’re good!
3. Chemical weapons, air pollution, leaded gasoline, ozone-depleting CFCs, , malicious uses of AI-generated deepfakes, cryptocurrency bribes, and totalitarian governments are unnatural, and they’re bad.
4. Fresh fruit, clean air, clean water, photosynthesis, the ozone layer, and healthy ecosystems are natural4, and good.

“Natural/unnatural” and “good/bad” are entirely different axes of meaning, orthogonal to each other, and don’t seem to correlate that well. This writer is extremely confident in that statement, and although it’s inherently subjective, it appears to be backed up by reasonably applicable data.

If your (or someone else’s) argument against a new technology is “But it’s unnatural!” the logical response is “So what? So are flush toilets, light bulbs, and dentistry. Give me a reasonit’s bad.” A better question to ask would be, “Who, if anyone, does this new thing kill, or hurt, or impoverish? And, critically, does it do that more or less than what we have now? Is this an improvement over what we have now, or not?”

By strongly advocating the disentanglement of the “good/bad” and “natural/unnatural” axes, I’m not at all trying to dismiss out of hand the classic “Burkean conservative” or “Chesterton’s fence” genre of arguments. To wildly over-summarize, those arguments boil down to “don’t break down old things (institutions, policies, social norms, etc) just because you don’t understand their use and/or they seem bad, consider what value they might be bringing that you’re unaware of.” In fact, I’m trying to provide a complement to those argument, arguably an attempt to deploy “cautiousness” or the “small-c conservative” mindset from the perspective of the future: I’m trying to say “don’t break down new things just because you don’t understand their use and/or they seem bad, consider what value they might be bringing that you’re unaware of!”

We can solve lots of objectively bad environmental, social, and public health problems by using “unnatural” technologies and processes (solar panels! vaccines!) and it’s important to remember that. We can also solve lots of objectively bad problems using “natural” technologies and processes (planting trees for shade! marshes preventing erosion!), and it’s important to remember that as well.

So please, whenever applicable in your life, as a voter, consumer, patient, caregiver, worker, and citizen, try to judge new technologies, ideas, and processes by really thinking through whether their effects will be on net good or bad, whatever those values mean to you. Whether it’s “natural” or “unnatural,” may be interesting, but it’s not relevant.

1. Although funnily enough you almost never see these people trying it themselves.
2. That’s not to say that the Internet (or TV, radio, or the printing press, for that matter) are 100% good (although I do think that all four are a net benefit to the world, so far), just that it doesn’t make sense to condemn them as bad for being “unnatural” given that pretty much all of human existence is “unnatural,” including many great and good things.
3. Wait, war existed before modern humans? Yes; chimpanzee groups have been observed waging multi-year high-casualty conflicts which most researchers describe as “wars.”
4. One could of course nitpick all of these ad infinitum: most commonly eaten fruits are the result of generations of selective breeding, clean air and clean water can be produced by filtration systems and you could make a case that in the context of a technological civilization they’re a function of the legal and regulatory environment even in the wild, etc. But come on, you know what I’m trying to say here! I’m working with the quasi-consensus socially accepted definitions of “good,” “bad,” “natural,” and “unnatural,” these are not precisely defined terms.

The discovery of Hawaii by the ancient Polynesians marked the conclusion of a 2,000-mile voyage, and one of history’s greatest adventures.

by Julian Karas

On this fourth of July I thought it appropriate to bring a bit of Hawaii to all of you.

 

The discovery of Hawaii was no accident. The Polynesians needed vision, courage, and all their maritime skills to make it happen. Travelling across more than 2,000 miles of ocean in open boats, they found themselves in a tropical paradise like no other. They wasted no time building a thriving civilization of their own.

They Wondered What Was Over The Horizon

Because of overpopulation, many people were having a hard time making a go of it in their traditional islands in the Marquesas (French Polynesia). They wondered if a more prosperous land lay over the horizon. As Polynesians, they were accustomed to travelling long distances by boat. After a while, they got tired of wondering what lay across the sea, and decided there was only one way to find out.

How They Navigated

The Polynesians set sail northward in their double-hulled canoes. Sailing without instruments, they found their way by observing the position of the stars, ocean swells, bird behavior, and cloud patterns. This practice gave them the ability to find their way to land without seeing it off in the distance, a traditional Polynesian art passed down from generation to generation.

They Didn’t Come Empty-Handed

The mariners loaded up their canoes with the plants and animals they needed to create a proper ecosystem: taro, breadfruit, sweet potato, bananas, sugarcane, coconut, as well as pigs, chickens, dogs, and sometimes rats. All of this enabled them to quickly get down to business and replicate their original homeland in a new environment. When the pioneers finally came ashore on the black sands of a Hawaiian beach, they realized they had discovered a paradise beyond anything they’d ever dreamt of.

Initial Settlement And Land Use

The most recent carbon-dating places the arrival of the Polynesians in Hawaii at around 1000 to 1200 AD. Not surprisingly, the newcomers preferred to settle near coasts and fertile valleys, in communities built on agriculture and fishing. They cultivated terraced taro paddies and elaborate fishponds, making ingenious use of the land from mountain to sea. The new society struck a balance between sustainability and their own needs for survival.

Social And Political Structures

Hawaiian society evolved into a complex class hierarchy from chiefs through priests, artisans, commoners, all the way down to slaves. Temples to the various Hawaiian gods and a series of ongoing community rituals provided the structure for traditional Hawaiian spiritual beliefs.

A Culture That Grew Up In Paradise

Isolated from the outside world, Hawaii’s culture flourished. All kinds of stories, chants, and ceremonies galvanized the islanders with a shared identity. Skilled artisans carved canoes, built mighty temples, and crafted tools with frenetic energy. All this time native agriculture and fisheries provided the bounty to feed a hungry civilization. That civilization was sustainable and resilient. They knew all the native plants, seasons, and the environment inside out. 

The Europeans Arrive To An Uneasy Welcome

Contact with the Europeans of Captain Cook’s voyage in 1778 brought inevitable change, but the Hawaiians held on tight to the memory of their own navigational heritage. In the 1970s, the Polynesian Voyaging Society built a traditional canoe to revive their system of star-based navigation. Its triumphant voyage to Tahiti in 1976 proved their method of overseas exploration was viable, and not a one-off accident. It was a renaissance transcending time, and gave Hawaiians a justifiable pride in their indigenous knowledge.

They Did It Their Way

Rome wasn’t built in a day, and neither was Hawaii. Polynesian settlement is a story of remarkable courage, maritime skill, ecological planning, cooperation, and smarts. The early voyagers traversed tremendous distances, recreated a complete ecosystem, and forged a fascinating civilization on the Pacific’s most isolated islands. It is a paradise that has endured to become America’s 50th state.

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Chipotle, Starbucks, and the Huge Construction Machinery Dealers

Guest writer Andy Fanter dives into the cross-industry pool with today’s blog post: “Chipotle, Starbucks, and the Huge Construction Machinery Dealers.”

Starbucks has been struggling. Plenty of national chains and local competitors are offering coffee and related snacks. Chipotle has been growing for years with a simple model. Come make your burrito or bowl and order a high margin drink. We are not cheap, and do not study the calories and sodium too much. Fresh ingredients taste good, and people come to get it for lunch and dinner. Starbucks hired CEO Brian Niccol from Chipotle to fix the problem. His solution:  reduce the menu and make stores less chaotic. Sell hot and cold coffee drinks and related snacks—and be faster. The best products….faster.

 

How does this apply to the construction machinery dealer? I have been in this business 30 years, and around it since the late 1970s. Consolidation has made dealers excessively big; billion dollars in revenue surprises no one anymore. Smaller competitors chip away at market shares—sound familiar, Starbucks. Dealer reaction, flat forecasts to stay big. The US economy and construction are expanding 85% of the time. Why not order more of the best 10 to 15 products expecting to grow those sales by 10% next year?

 

Here is what I am seeing with flat forecasts. Get into spring and dealer needs more machines—months from manufacturer, standard. Neighboring dealer-takes top management time to negotiate a deal. Buy used equipment for rental fleet and sell from rental fleet. Now the used division is not happy having to add to the rental fleet instead of to customers. Product support starts to get busier and trying to get used machines ready for rental fleet. The rental reps are not happy because good machines are being sold. Finally, the regular field sales force is unhappy because there are not enough of the best machines to go around. A year spent holding, or likely slipping in market share. The sales force does best when they have the best items to offer customers.

 

The machinery dealer needs to be a mix of Starbucks and Chipotle. Manufacturers and customers insist on a wide range of products, and locations—a little chaotic like Starbucks. Dealers know the hot models that their customers prefer. Have plenty of those, new, and ready to go—Chipotle model. 

 

It is much easier for the reps to get more deals for a variety of products when they do not have to account for long delays on the best products. What happens if you order too much? Dealer trades and adds to the rental fleet.

 

Just like Starbucks manages through the chaos.

 

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Slow to Hire, Quick to Fire… BS.

This post is a reprint of the article by the same name by Rich Cruz.

Antiquated Hiring Philosophy May Hamper Growth

Recently, I applied and interviewed for an open executive position at a well-established company in the construction industry. Despite its success and expansion, my experience with their hiring process raised serious concerns. After nearly two months of waiting for my first interview and being told the hiring decision wouldn’t be made for at least two more months in the future, I underwent three interviews and was asked to produce a detailed 30, 60, and 90-day plan. Excited to move to the next level, I submitted a high-level outline of a plan via email, explaining that I cannot deliver a full plan without knowing more about the company through examining and analyzing data. The hiring manager insisted on a full PowerPoint presentation, and he coupled his request with the statement, “I am slow to hire and quick to fire.” This led me to withdraw from the process. This phrase, often touted in business owner coaching or peer-group circles, prompted me to delve into why it might have some fundamental flaws.

 

The Myth of “Slow to Hire, Quick to Fire”

 

The phrase “slow to hire, quick to fire” has its roots in the belief that thorough hiring processes ensure better employee fit and swift terminations minimize the impact of poor hires. Proponents argue that this approach leads to a more productive and harmonious workplace. Indeed, some literature supports this philosophy, such as articles from Harvard Business Review and Forbes. However, from an Industrial-Organizational Psychology perspective, this approach can pose a detrimental threat to both individual and organizational performance. While hiring for fit for a position with a company should involve rigor, too many assessments, interviews, work samples, or other forms of evaluation can reduce the pool of candidates and pose risks to the organization.

 

The Downside of “Slow to Hire”

 

An unbalanced approach that does not emphasize timely and efficient hiring processes can create detriments for both employees and organizations. Some drawbacks include:

 

  1. Talent Drain: Lengthy hiring processes can lead to the loss of top talent. High-caliber candidates often have multiple opportunities and may not wait months for a decision. As Peter Drucker famously noted, “The best way to predict the future is to create it.” Creating a future with top talent requires swift, decisive action.
  2. Increased Costs: Prolonged vacancies can result in significant costs in terms of lost productivity and the expenses associated with extended recruitment efforts. According to Kouzes and Posner, effective leadership creates a vision and rallies people around it. Delays in hiring disrupt this vision and impede progress.
  3. Negative Candidate Experience: A cumbersome hiring process can damage an organization’s reputation. Candidates talk, and word spreads quickly about companies with inefficient recruitment practices. This can lead to a tarnished employer brand, making it harder to attract top talent in the future.

 

The Pitfalls of “Quick to Fire”

 

Similarly, organizations that fail to invest in their employees and nurture organizational citizenship behaviors (OCBs) with on-the-job training, coaching, rewards, and other reinforcement can suffer consequences such as:

 

  1. Cultural Impact: Frequent terminations can create a culture of fear and uncertainty. Locke and Latham’s Goal Setting Theory emphasizes the importance of clear, attainable goals for employee motivation. A “quick to fire” approach undermines this by fostering instability and mistrust.
  2. Loss of Investment: Hiring and onboarding can cost as much as 1.5 times a worker’s salary. Quick terminations mean the organization loses its recruitment, training, and development investment. Additionally, the constant churn can disrupt team dynamics and hinder long-term projects.
  3. Erosion of Employee Morale: The psychological contract between employer and employee has its foundation in mutual trust and respect. When employees see their peers seemingly indiscriminately terminated, it can lead to decreased morale, engagement, and loyalty. Positive Organizational Behavior (POB) framework – which highlights the importance of hope, confidence, and resilience in fostering a productive workforce – supports the consequences of broken psychological contracts.

 

Evidence from Experts

 

The literature from scholarly resources and best-selling authors offers insight into better ways to attract and retain top talent.

 

  1. Peter Drucker: Drucker emphasized the importance of nurturing talent and creating a culture of continuous improvement. His writings suggest that a balanced approach to hiring and firing, focusing on development and fit, provides a more sustainable workplace than extreme practices.
  2. Kouzes and Posner: In their works on leadership, Kouzes and Posner highlight the significance of fostering an inclusive, supportive environment. Leaders should focus on building relationships and empowering employees rather than relying on punitive measures.
  3. Locke and Latham: Their Goal Setting Theory underscores the need for achievable goals for individuals and work groups tied to organizational objectives. A hasty firing approach disrupts goal alignment and diminishes the sense of purpose within the organization.
  4. Angela Duckworth and Carol Dweck: Their research on grit and growth mindset, respectively, points to the importance of perseverance and learning from mistakes. Quick terminations deprive both the employee and the organization of the opportunity to grow and improve.

 

While “slow to hire, quick to fire” might appear as a catchy mantra, it falls short when scrutinized through the lens of Industrial-Organizational Psychology and leadership theory. A more balanced approach, emphasizing timely yet thorough hiring processes and supportive, development-focused retention strategies, is key to fostering a thriving organizational culture. My recent experience underscores the importance of evaluating not just the processes but potential employers’ underlying values and culture. Ultimately, businesses that invest in their people by balancing rigor with empathy possess a better chance to succeed in the long run.

 

References

 

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SmartEquip Sets its Sights on New Markets

This week we present an interview by Jenny Lescohier. She spent some time with Alex Schuessler to give this report: “SmartEquip Sets Its Sights on New Markets.”

Part of Ritchie Bros’ umbrella of companies, SmartEquip looks to expand its equipment lifecycle support and parts procurement platform across the globe

 

To the digital natives in today’s rental industry, SmartEquip’s presence as a service support platform might be taken a bit for granted. Its role has become so integral in its customers’ operations, some users might not be able to imagine the way things used to be done.

If you ask Alex Schuessler, founder, and president of SmartEquip’s International Group, he’ll tell you things have come a very long way since 2000, when the company started.

Alex Schuessler, founder & president, International Group.

 

SmartEquip now supports almost eight hundred suppliers worldwide and more than one hundred rental fleets on its system, including the top five global rental companies.

“For the typical rental company anywhere in the world, approximately 1% of overall spend is on parts. And yet, in the absence of our technology platform, because of the operational overhead associated with parts procurement, it will still be the most expensive type of purchase,” he notes. 

“First, you need to be a service technician to identify the right parts for your equipment. And when you get it wrong – which is often the case, because it’s very difficult to get the right parts for the right make, model, and serial number – the consequences are costly, not just in terms of service technician time, but also equipment performance: even if just one the 10 parts you order is wrong, that equipment will be down for at least another 24 hours.”

 

He adds, “Service technicians themselves are the most expensive employees in a rental operation, and they are increasingly hard to come by. So that’s really what we first focused on, and we subsequently became very obsessive about everything to do with the machine lifecycle and how to reduce associated costs along the way. The ultimate question was, how do we minimize downtime, and how do we accomplish this in an industry-spanning way?”

We talked with Schuessler to find out more about SmartEquip and how it’s affected the way rental companies procure parts and more. Here’s what he had to say:

Rental Briefing: What led you to SmartEquip?

Schuessler: I was originally trained as an economist and political scientist specializing in data science and worked as a junior professor at New York University. One of the things I was always very interested in was how to make the ever-increasing amounts of data the world was generating usable, and actionable for people who were not data scientists.

While I was at NYU, through a weird set of coincidences, I was asked to give some advice to a former Caterpillar executive who had just been invited back to help Cat launch a corporate rental initiative for dealers across South America.

I became one of the co-founders of a global equipment rental consulting group initially called Caterpillar Rental Services Network Inc. (CRSNI), which later rebranded itself as Script International.

We created rental locations across forty-five countries, initially across South America for dealers there, and later, across the Middle East and Europe, too. Much of what we did back in the 1990s found itself in what is known as The Cat Rental Store today.

While we’re doing that, as an economist I became very involved in modeling the power of rental in helping dealers cope with an environment of hyperinflation, as was rampant in those days. But I also began to look at fleet efficiency, return on asset, equipment lifecycle costs, and so many other things. I thought, there’s so much opportunity here for technology to drive efficiently.

We seed-funded SmartEquip with a focus on helping large equipment rental companies like United Rentals, Sunbelt Rentals, and NationsRent support service technicians and automate the procurement of tens of thousands of different parts from hundreds of different suppliers in an efficient, serial number-specific way to reduce service labor and equipment lifecycle costs and improve equipment uptime.

SmartEquip is both a service support platform but also a purchasing and procurement environment.

Rental Briefing: How has SmartEquip grown over the years?

Schuessler: Over the past 24 years, SmartEquip has grown to support almost eight hundred suppliers worldwide across more than one hundred rental fleets through its network, and this includes the top five global rental companies.

A major milestone was the 2021 acquisition of SmartEquip by Ritchie Bros. (now RB Global), which represented a movement in focus by RB Global, which had begun with the earlier acquisition of Rouse. RB Global has long been the global leader in supporting the buyer and the seller in the transactions of equipment, in maximizing the returns for buyers and sellers alike. With the acquisition of services companies, RB Global now turned its attention to maximizing the returns on owning equipment as well.

This, of course, has always been SmartEquip’s obsession: Our goal had never been to maximize the returns on an asset sale, but to maximize the returns on asset ownership.

RB Global bought Rouse a couple of years prior, given its focus on helping companies understand their performance by benchmarking pricing and utilization metrics using localized market information, and providing localized market values by showing in near-real time, what a fleet’s assets are worth in the retail and auction market.

With Rouse and SmartEquip, RB Global offers a full lifecycle experience to the owner, be it for the bookends of equipment acquisition and disposition, or the period of ownership in between the two. It’s become a very full set of solutions that covers everything that affects equipment owners, from the purchase itself, to helping determine when to sell, all while minimizing the cost of service and support along the way.

On a practical basis, the acquisition by RB Global provided us with access to a global corporate infrastructure, strategic accounts and partnerships which have all contributed significantly to accelerating SmartEquip’s growth.

Rental Briefing: What markets is SmartEquip focusing expansion on?

Schuessler: We are currently witnessing record growth rates, not just in North America, but across Europe and Asia-Pacific as well. In Europe we have sufficient penetration among the largest rental companies, who have taken the lead in making us an industry standard, such that we can now expand into supporting mid-sized rental companies as well.

In Asia-Pacific, Japan is a major focus due to its rental-focused market with over 85% rental penetration. Factors like low rental rates increase the potential impact not only of SmartEquip’s cost-reduction solutions, but also of the positive impact Rouse can have to make informed fleet management and capital allocation decisions. Two of the four largest Japanese rental companies are already on SmartEquip, and we are projecting significant growth for the years to come both here, as well as across other APAC nations such as Australia.

Rental Briefing: What challenges exist in these new markets?

Schuessler: Cultural differences can pose initial challenges to adoption, especially in Asia-Pacific markets like Japan, where relationship building is important. However, the goals of optimizing equipment utilization and costs are globally consistent, so the solution is remarkably robust across the international scope.

Unique local market factors may also impact SmartEquip’s solutions. For example, Japan’s low rental rates mean profitability for a given asset is often only achieved toward the end of its ownership lifecycle, at the point of resale. This increases the potential return on SmartEquip’s solutions that aim to reduce costs and inform optimal resale timing across the ownership period, and it increases the potential return on Rouse solutions, by helping users leverage their data to compete effectively and make informed, timely disposition decisions.

Understanding such nuances is crucial for SmartEquip to tailor its value proposition. While technology implementations may face initial hurdles, cloud-based offerings have made SmartEquip more accessible worldwide.

Partnerships are also vital, like SmartEquip’s strategic local partner in Japan that mirrors its business model and relationships. Overall, different markets represent greater opportunities due to SmartEquip’s unique ability to impact equipment ownership economics.

Rental Briefing: What is the SmartEquip e-commerce platform?

Schuessler: Originally launched as a “webshop” extension for equipment manufacturers who were already partnering with SmartEquip, the eCommerce platform has since evolved into a full-fledged solution for any company seeking to sell parts online.

Parts e-commerce requires far more extensive data structures than standard e-commerce applications, and this is where SmartEquip leverages its extensive industry knowledge to ensure accuracy and efficiency, alongside ease of use. This provides a far richer shopping experience in an equipment context, compared to general e-commerce platforms which cannot support the complex transaction surrounding parts.

Recent additions include more extensive options for online payments and user registration, supporting the use of the platform as a standalone solution rather than just an extension of SmartEquip’s Network. It has seen success with manufacturers and with dealers and rental companies who are also selling parts to their customers.

Published on 21 May, 2024

About International Rental News (IRN)

International Rental News (IRN) is written for equipment rental companies worldwide. Our readers operate in sectors including construction, general industry and events, and rent equipment including construction machines and tools, aerial platforms and telehandlers, portable accommodation, shoring equipment, and power and heating and cooling equipment.

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Daimler and Volvo announce truck tech partnership

A paper by Jason Cannon

 

Aloha

I thought that I should share this across our blog community because of what this represented. 

Volvo and Daimler sharing software is a truly significant happening. I congratulate them for thinking about their customers first. 

If only there was a standard platform for all equipment manufacturers so allow their customers to select software that they want to track all of their equipment regardless of brand. Think about the possibilities. Electronic Catalogues. Standard Times for Repairs and Maintenance. Instructions on performing repairs. Special glasses like BMW Augmented Reality from the 1990’s to talk to a technician performing a repair and telling them the tools to use, the specification, the repair steps all with graphics on the glasses. Just imagine that.  

Daimler and Volvo announce truck tech partnership.

By Jason Cannon

Volvo Group and Daimler Truck have reached a preliminary agreement to establish a joint venture to develop a common software-defined vehicle platform and dedicated truck operating system, which the companies expect will provide the basis for future software-defined commercial vehicles and make the new joint venture a leading developer of standardized hardware and software. 

 

This technical basis, the companies said, will then enable Volvo Group and Daimler Truck – 50/50 partners in the joint venture – and potentially other partners to provide “differentiating digital vehicle features for its products, ultimately enhancing customer efficiency and experience.” The joint venture is set to be headquartered in Gothenburg, Sweden, incorporating existing assets and resources of both companies into the new organization. The goal, both stakeholders said, is “to set the industry standard for a truck operating system and offer its products to other OEMs as well. To that end the joint venture will provide a common developer platform as a service, on top of which its customers can build differentiating software layers.” 

 

The two commercial truck giants in 2020 established a joint venture to develop hydrogen fuel cells. That joint venture, named cellcentric, included operations in Nabern, Germany, headquarters of the Mercedes-Benz Fuel Cell, with production facilities in Germany and Canada.

 

“Given the rapid transformation of our industry, it makes sense to collaborate to accelerate development, increase volumes and share costs. Software-defined heavy-duty trucks represent a paradigm shift in the transformation of our industry,” said Martin Lundstedt, Volvo Group president and CEO. “Making the truck a programmable device with standardized hardware and operating system for fast product updates will give both companies the opportunity to create value for our customers and their customers though differentiating digital services and solutions. Partnership is truly the new leadership.”

 

The Volvo Group and Daimler Truck venture will operate as an independent entity, with the two continuing to be competitors in all other areas of business.

Jason Cannon has written about trucking and transportation for more than a decade and serves as Chief Editor of Commercial Carrier Journal. A Class A CDL holder, Jason is a graduate of the Porsche Sport Driving School, an honorary Duckmaster at The Peabody in Memphis, Tennessee, and a purple belt in Brazilian jiu jitsu. Reach him at ja*********@***********ly.com

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