Page 42 – Learning Without Scars

A Special Announcement from the AED Foundation

AEDF Announces Partnership with Learning Without Scars to Provide New Programs

AED Foundation (AEDF) is excited to announce the addition of two new programs to its catalog, in partnership with Learning Without Scars.

The In-Store Selling Fundamentals Program is designed for parts counter employees looking to advance their product support skills. It includes individual courses on teleselling, overcoming objections, in-store merchandising, and buyers’ needs.

The Service Writers Program offers instruction in the core service department functions most relevant to service writers. It includes individual courses on service organization, work order process, time management, and inspections.

Each program allows the user to earn IACET approved CEUs that are recognized by universities, junior colleges, technical and vocational schools worldwide.

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May 13, 2022

Filosophy

Friday Filosophy v.05.13.2022

Milton Friedman (July 31, 1912 – November 16, 2006) was an American economist. He believed in monetarism. Monetarism is the theory that how much money the government prints each year has a huge effect on the economy. He supports the government printing the same low rate of money each year rather than a different amount each year.

Friedman was born in Brooklyn, New York to a Hungarian–Jewish family. He was raised in Rahway, New Jersey. Friedman studied at Rutgers University, at Columbia University, and at the University of Chicago. He worked thirty years in Chicago with George Stigler as a leader of the Chicago school of economics.

During the 1970s, Milton Friedman’s idea of monetarism gained popularity and he became an economic advisor to President Ronald Reagan. Friedman believed that the government control over the economy should be limited. He supported cutting taxes, lowering government spending, getting rid of government rules that limited the economy and letting parents choose which school their taxes paid for. His political views were libertarian. He was against forcing people to join the army, and said that getting rid of United States military conscription was the thing he was most proud of doing.

Throughout several decades, Friedman made many documentaries, books, and interviews to express his views to the public. The main books he wrote were Capitalism and Freedom and Free to Choose.

When government – in pursuit of good intentions – tries to rearrange the economy, legislate morality, or help special interests, the cost come in inefficiency, lack of motivation, and loss of freedom. Government should be a referee, not an active player.
Inflation is taxation without legislation.
Nothing is so permanent as a temporary government program.
We have a system that increasingly taxes work and subsidizes nonwork.
There’s no such thing as a free lunch.
I think that the Internet is going to be one of the major forces for reducing the role of government. The one thing that’s missing, but that will soon be developed, is a reliable e-cash – a method whereby on the Internet you can transfer funds from A to B without A knowing B or B knowing A.
I am favor of cutting taxes under any circumstances and for any excuse, for any reason, whenever it’s possible.
Governments never learn. Only people learn.
Concentrated power is not rendered harmless by the good intentions of those who create it.
The most important single central fact about a free market is that no exchange takes place unless both parties’ benefit.
Indeed, a major source of objection to a free economy is precisely that it… gives people what they want instead of what a particular group thinks they ought to want. Underlying most arguments against the free market is a lack of belief in freedom itself.
Universities exist to transmit knowledge and understanding of ideas and values to students not to provide entertainment for spectators or employment for athletes.
The only way that has ever been discovered to have a lot of people cooperate together voluntarily is through the free market. And that’s why it’s so essential to preserving individual freedom.
And what does reward virtue? You think the communist commissar rewards virtue? You think a Hitler rewards virtue? You think, excuse me, if you’ll pardon me, American presidents reward virtue? Do they choose their appointees on the basis of the virtue of the people appointed or on the basis of their political clout?
I’m in favor of legalizing drugs. According to my values system, if people want to kill themselves, they have every right to do so. Most of the harm that comes from drugs is because they are illegal.
Most economic fallacies derive from the tendency to assume that there is a fixed pie, that one party can gain only at the expense of another.

The Time is Now

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May 13, 2022

Floyd Jerkins

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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May 12, 2022

Ryszard Chciuk

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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May 12, 2022

David Gordon

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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May 10, 2022

Mets Kramer, Technology

Going Digital Post-Pandemic

Guest writer Mets Kramer brings his digital knowledge to readers in “Going Digital Post-Pandemic.”

Much has been written about what’s happened over the past 2 years due to the pandemic. It has affected millions of people in countless ways. As we near the end of this time, most people will return to working the same way they did before the pandemic and many will wonder why the change, they saw over the last 2 years didn’t last. Why didn’t the transition to working from home, hybrid or flexible work stick around. A year ago, in the middle, many people talked about how we would never go back, and yet we are.

A friend of mine owns a staffing company, when the pandemic started, they, like most, sent all their staff to work from home. After a few months he made a bold move, he closed and sold the office. He and his leadership team fully embraced the new remote work culture. They made the decision that working remotely was more than just a pandemic need, but a viable long-term solution. Then they did something even more rare, they implemented countless changes to their business process and structure to support making remote work successful. Selling the office was one major incentive but realizing there was a need to adjust how they worked was the most significant change.

Unfortunately, this disciplined and proactive approach was something many equipment dealers failed to do. Most companies, in general, cobbled together just enough digitization of their workflow to keep the business running, they didn’t COMMIT to digital processes. What’s interesting about going digital is the process is the same with or without a pandemic. To go digital requires a commitment to think digital first, the pandemic just gave us a golden opportunity to justify the change and see it work.

When the pandemic started, I was largely surprised how many dealers simply “battened down the hatches” of their company ship. Rather than solving the problems of not seeing their customers in person they simply went back to doing things in the way they “knew” even though everyone was ready to justify a newer approach. One key area was equipment marketing and sales.

For most dealers their approach to listing, presenting and promoting their equipment hasn’t changed. They provide limited amounts of information through traditional platforms. Yet we have countless examples of how, without the ability to visit the machine in person, video and more complete machine descriptions helped dealers sell machines even at the height of the pandemic. Customer committed to buying machines from digital information alone, but how many dealers have embraced this and continued it.

In service, I still see a similar lack of digitization where the justification and solutions were abundant. How many shops still collect paper timecards post pandemic? There are countless digital service report and payroll timecard systems, paper timecards should have gone the way of the “Dodo,” yet without a conscious commitment to going digital, they have remained the norm.

Some dealers have embraced this change, they have looked for way to allow they coordinators and admins to work remote and still be efficient by transforming their workflows into digital. The amazing thing is, this change is exactly the change needed to meet modern customer expectations for a “digital first” experience. Implementing digital sales delivery platforms like CRM enable digital engagement with customers and simplify sharing digital documents with customers. Digital service reports and work order scheduling enables integration with customer facing websites to view work order status and communicate the work performed. In many ways digitizing service departments creates the level of quality service history that justifies a 10% increase in sales prices, at a minimum.

Going digital, becoming a digital dealership, requires a commitment from management to rethink workflows. The benefit is a more flexible work environment, a more efficient process and better digital information to support higher prices. Unfortunately, it doesn’t happen automatically.

As we near the end, while many dealerships haven’t changed, many things have. First and foremost, the customer expectations have changed. Customers have experienced a new world for the past 2 years and many have sought out digital solutions to their one processes, and found it was possible. This changing expectation adds to generally improved digital options in all areas of life and generational change. Customers have tasted the digital future and will only want more.

The second major lingering change is the expectations of employees. 2 years ago, you sent them home to work remote, urgently trying to keep the business going. They adjusted their lives and saw a future of less commuting and more focused work. While it doesn’t work for everyone in every role it changed the expectation of what was possible. Now it’s up to management to change too.

My concern for many companies is management. For those managers that didn’t rethink their workflows to support a true digital process. For those that didn’t commit. For those that didn’t learn to understand what their teams did all day, the urge to bring people back to the office full time will kill their opportunity to digitize their business. They will have missed the most significant opportunity in their generation.

One final example of digitization post-pandemic, online parts sales. How many dealers who had online parts sales before the pandemic, saw an increase in online orders? How many dealers saw an increase in orders by phone, email and text? Your customers can buy almost everything they want digitally in their personal life or even for business, yet countless dealers still have not formalized online parts options. Most dealer sites still have, at best, a form for parts order requests on their website. Most dealer websites still only have a parts page with a phone number. It’s time to commit and invest in going digital first, to becoming a Digital Dealership, your customer’s expectations have changed, as have those of your employees.

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May 10, 2022

Filosophy

Friday Filosophy v.05.06.2022

Ludwig Heinrich Edler von Mises (September 1881 – 10 October 1973) was an Austrian School economist, historian, logician, and sociologist. Mises wrote and lectured extensively on the societal contributions of classical liberalism. He is best known for his work on praxeology studies comparing communism and capitalism. He is considered one of the most influential economic and political thinkers of the 20th century.

Mises emigrated from Austria to the United States in 1940. Since the mid-20th century, libertarian movements have been strongly influenced by Mises’s writings. Mises’ student Friedrich Hayek viewed Mises as one of the major figures in the revival of classical liberalism in the post-war era. Hayek’s work “The Transmission of the Ideals of Freedom” (1951) pays high tribute to the influence of Mises in the 20th century libertarian movement.

Mises’s Private Seminar was a leading group of economists. Many of its alumni, including Friedrich Hayek and Oskar Morgenstern, emigrated from Austria to the United States and Great Britain. Mises has been described as having approximately seventy close students in Austria.[6]

Many who are self-taught far excel the doctors, masters, and bachelors of the most renowned universities.
Everyone carries a part of society on his shoulders; no one is relieved of his share of responsibility by others. And no one can find a safe way out for himself if society is sweeping toward destruction. Therefore, everyone, in his own interests, must thrust himself vigorously into the intellectual battle. None can stand aside with unconcern; the interest of everyone hangs on the result. Whether he chooses or not, every man is drawn into the great historical struggle, the decisive battle into which our epoch has plunged us.”
He who is unfit to serve his fellow citizens wants to rule them
If history could teach us anything, it would be that private property is inextricably linked with civilization
The Marxian’s love of democratic institutions was a stratagem only, a pious fraud for the deception of the masses. Within a socialist community there is no room left for freedom.
The champions of socialism call themselves progressives, but they recommend a system which is characterized by rigid observance of routine and by a resistance to every kind of improvement. They call themselves liberals, but they are intent upon abolishing liberty. They call themselves democrats, but they yearn for dictatorship. They call themselves revolutionaries, but they want to make the government omnipotent. They promise the Garden of Eden, but they plan to transform the world into a gigantic post office. Every man but one a subordinate clerk in a bureau
Every socialist is a disguised dictator.
Socialism is an alternative to capitalism as potassium cyanide is an alternative to water.
The worship of the state is the worship of force. There is no more dangerous menace to civilization than a government of incompetent, corrupt, or vile men. The worst evils which mankind ever had to endure were inﬂicted by bad governments. The state can be and has often been in the course of history the main source of mischief and disaster
Under capitalism the common man enjoys amenities which in ages gone by were unknown and therefore inaccessible even to the richest people. But, of course, these motorcars, television sets and refrigerators do not make a man happy. In the instant in which he acquires them, he may feel happier than he did before. But as soon as some of his wishes are satisfied, new wishes spring up. Such is human nature.
All people, however fanatical they may be in their zeal to disparage and to fight capitalism, implicitly pay homage to it by passionately clamoring for the products it turns out.
A man who chooses between drinking a glass of milk and a glass of a solution of potassium cyanide does not choose between two beverages; he chooses between life and death. A society that chooses between capitalism and socialism does not choose between two social systems; it chooses between social cooperation and the disintegration of society. Socialism is not an alternative to capitalism; it is an alternative to any system under which men can live as human beings.
The worst thing that can happen to a socialist is to have his country ruled by socialists who are not his friends.

The Time is Now.

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May 6, 2022

Consulting Services, Training

Our Winsby Announcement

Founder and Managing Member Ron Slee makes our Winsby announcement today, describing the new link between our two companies and where readers can learn more about this.

We are pleased to announce a change in our relationship with Winsby.

Winsby, which is a Colleague of Learning Without Scars, has now tied their website to ours. This completes the cross connection with Learning Without Scars. We are listed as an Affiliate on their website. You can find us by going to their website at https://www.winsbyinc.com/about-us.html

Winsby has been helping equipment dealers grow for over fifteen years. By analyzing the dealer’s customers’ invoices, Winsby easily identify the marketing efforts that work well. As a result, only effective programs are included in ongoing programs. The goal is always to increase revenue as efficiently as possible.

With specialists in every essential marketing area, Winsby offers a complete range of services. On staff are researchers, writers, designers, programmers, list specialists, financial analysts, videographers, account managers, and a group of skilled callers. After analyzing your invoices, Winsby will recommend and implement a program that keeps your business growing steadily.

Please visit their website for more information.

The time is now.

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May 6, 2022

Gary Stansberry

Dedicate It To Rental

Our new guest writer, Gary Stansberry, President of The Stansberry Firm, has over 20 years mergers and acquisitions experience within the rental industry with 135 transactions totaling over $1.2 billion in transaction value. As an executive with two publicly traded strategic acquirers, Mr. Stansberry served as a buyer’s representative sourcing, evaluating, negotiating, managing and closing transactions throughout the country. Since 2000, Mr. Stansberry has served as a middle market transaction advisor serving business owners, strategic and financial buyers in mergers and acquisitions, market value and operational analysis. In this, his first blog for Learning Without Scars, Gary writes about our time, and the fact that we need to dedicate it to rental.

Recent construction rental transactions include Illinois Truck & Equipment (Morris, IL), Toolshed Equipment Rental (Escondido, CA), Priority Rental (Philadelphia, NYC), B&M Equipment Rental (northern Florida) and We-Rent-It (six locations in central Texas).

Like many of the clients he serves, Gary is an entrepreneur to the core. Prior to his merger and acquisitions experience, Mr. Stansberry founded and sold two successful businesses including a construction equipment sales and rental business. He has served as President, General Manager, Controller and Chief Financial Officer of several closely held firms including an auto parts distributer, a diversified oilfield services company and construction equipment sales and rental businesses. Gary is a Certified Public Accountant (non-practicing) and spent two years with a national public accounting firm. Gary holds a B.B.A. in Accounting from Texas Christian University.

Mr. Stansberry is a frequent contributor to various rental industry trade publications including Rental Equipment Register and Rental Management. In addition, he is often called upon as a featured speaker with various rental industry trade groups and software providers. Private equity firms, investors and high net worth individuals regularly seek Gary’s advice and expertise in evaluating investments and acquisitions within all aspects of the rental industry including construction equipment sales and rental, party/special event rentals and oilfield rentals and service.

Early in my career, I worked at an oilfield service company here in Texas. Something I learned there that has always stuck with me is the sense of urgency and the responsiveness to customer needs that were instilled in all levels of the operations. In the oilfield, “time is money”; keep large drilling rigs or large crews waiting on your services and you won’t be back on the next job.

Fast forward 10+ years when I joined Rental Service Corp. (RSC). I came to RSC from an AED type dealer that had what I thought was an active rental department. I thought we were in the “rental business”. What I found at RSC was a much different sense of urgency mentality, similar to what I had experienced in the oilfield. My thoughts were recently summed up by the head of the rental division of a large AED dealer. As we pulled up to one of their operations, the rental executive motioned to the left where the dealership operations were based and said “Those guys move slow”, then to the right where the rental division was located and said “We move fast.”

I can hear the groans from the dealership management saying that’s an unfair judgement. Maybe so, but I also think there will be some reluctant acknowledgment of truth to that. Having been on both sides of the equation, I can tell you that, to truly run a successful rent-to-rent operation, it requires dedication to rental. By dedication, I mean in every send of the word:

A dedicated workforce from mechanics, to rental counter personnel, rental salesman and rental management. I don’t want my shop foreman “triaging” equipment and personnel deciding on whether to work on a customer machine or a rental machine. I don’t want my salesman spending hours on working on a deal to sell a 100,000 lb. excavator instead of the minutes it takes to quote a 3-month rental on a track loader.
A dedicated facility with its own rental counter, a shop and a yard. The rental counter is friendly to walk-ins, the yard is segregated by rental ready and machines waiting to be serviced. Often, this arrangement can be handled with a shared facility, with separate entrances, with shop and yard space designated for rental.
A dedicated rental fleet. No blurry lines between new sales, used equipment or rental purchase. These machines are dedicated to rent-to-rent and generally not for sale unless the rental machine can readily be replaced. I am okay with dealer oriented selling rental fleet quicker than a rental-only operation.
A dedicated set of Key Performance Indicators (KPIs) strictly for the rental division. This may require a separate software system or some customization to your current system. In rental, it is crucial to track dollar/financial utilization of the fleet, time/physical utilizations of the fleet, repairs and maintenance as % of rental revenues, among others. There are also some sophisticated “add-on” data services such as Rouse Analytics that provides this key data compared to others in your market that may require specific software.

Some may ask why spend all this time and resources to establish or refine a rental division. I would point to the following two factors as why rental should be an emphasis of your business:

The Rental Market is Growing. The American Rental Association, through its ARA Rentalytics™ service, has consistently touted 2022 to be a double-digit growth year for the construction and industrial rental segment. As recently as February 2022, the ARA affirmed its guidance for 12.1% growth in 2022 over 2021, with additional growth of 6% in 2023. There is the also notion that the combination of inflation, equipment availability and supply chain issues, in tandem with a labor shortage will cause more end users to rent equipment vs. buying equipment: i.e., an increase in rental penetration (equipment rented vs. owned by the end user). According to the ARA, rental penetration in 2019 was 56.7% and dropped to 54.5% in 2020. The last major shift in rental penetration was driven by the 2008 recession; according to the ARA rental penetration in the US was only 39.7% in 2005 steadily increasing from 2011 to the current level of 54.5%. Some industry observers believe the current market factors could drive rental penetration several points higher and possibly as high as 60% within the next 24-36 months.

Let’s talk margins. New equipment margins may only be 10%-15%. Used equipment margins may be 20%-25% and parts margins may be 30%-35%. Depending on how you figure your rental margins, generally your true cost of sales (depreciation, repairs, etc.) run only 20%-30% resulting in margins on rentals of 70%+.

Rental is a predictable, recurring revenue stream. Add in the fact it is a high margin, growing segment of a business that you are likely already in. Ask yourself, given these margins, this growth, how should you spend your next hour? My answer is to dedicate it to rental; you just may have to move a little quicker.

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May 3, 2022

C Stephen Clegg, Technology

Data Automation and AI Analytics

Today, we are proud to introduce a new guest writer. C. Stephen Clegg is a Managing Director at Winsby Inc. where he oversees the analytics division, Zintoro. He’s developed an AI model that shows exactly what your company’s strength and weaknesses are, based on your past three years of invoice data. The model is trained to predict where your revenues, customer retention, and purchase frequency are headed if nothing changes in your approach. It also provides the ROI on Winsby’s marketing programs, according to your customers’ purchases. In his debut blog for Learning Without Scars, he writes about data automation and AI analytics.

Data Automation and AI Analytics

Today, data automation and AI analytics is available for equipment dealers to easily service their
customers by identifying what defines the best customer service to drive profitable growth. The
days of opinions, intuition and guessing to make business decisions are in the past.
These automated and AI driven systems are affordable to almost every dealer of any size to
compile metrics into simple actionable real time reports and forecast the future. This approach
allows management and employees at every level to focus on what the customer needs and
expects while anticipating what resources will be required in the future. The ROI on these
programs is paid for many times over with reduced operating, sales, and marketing costs.
The equipment industry is extremely cyclical and seasonal. Most equipment dealers do not have
the tools, key metric reports and forecasting programs to take action and make intelligent
decisions in a timely manner. They often rely on subjective metrics that are not linked to
measurable operating and financial results. The lack of usable data causes management to be
reactive and always scrambling to solve the latest unanticipated problem.
Successful equipment dealers use AI automated systems and reports to monitor and solve their
major customer service and customer engagement issues which include: employee engagement
with customers, internal operating performance metrics, customer retention and engagement,
and identifying and closing sales opportunities.
If you do not have accurate operating and financial information, you will be unable to allocate
your time and resources effectively to the activities that will keep your dealership profitable and
support your future growth.
Programs such as Zintoro.com Artificial Intelligence (AI) Analytics shows you what you can
expect in your business over the next 12 months. It forecasts the number of transactions, the
number of active customers, and the expected revenues with an accuracy that exceeds 95%. It
also provides specific recommendations on how to improve your growth. This data can be
analyzed by department and by location, as well as overall.
The platform identifies customers that are at risk of being lost and tracks key metrics on a rolling
12-month basis, shows and tracks the key metrics that drive your company’s growth and
identifies leads for your sales reps.
By understanding your potential for growth and your current market position, the program
identifies the areas where you are falling short and where you excel, producing insights, backed
by data, into how to grow effectively and efficiently. The program is also able to identify what
tools are working and which customers are at risk of leaving, and it shows the markets and
industries you need to target to grow your business profitably.

The reports clearly identify sales reps, departments and customers that require attention, so you
have an easy-to-follow road map for growth using the key metrics and forecasts.

Some of the core key metrics reports used by successful equipment dealers include:
o Forecast and actual results for revenue, transactions, and active customers by
customer, department, branch and overall
o Sales retention leads for your sales reps to contact—customers in danger of being
lost
o Comparative rankings for branches and sales representatives
o Market Industry Analysis with the greatest opportunities
o ROI on sales and marketing programs

The following is an example of a Revenue ROI report for marketing programs, such as calling
prospects and customers and sending information to them, distributing emails, and conducting
customer satisfaction surveys, removing the guesswork from whether your marketing and sales
programs are working.

The equipment industry is a difficult business to operate. Zintoro.com, an AI analytics program,
allows you to plan and focus on building your business versus always struggling to react to
customer demands.

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May 3, 2022