Introducing our Colleague John Sessums
Our new guest writer John Sessums is the owner of Mechanic and Techs LLC, based in Baton Rouge, Louisiana. John’s career spans 38 years involved in equipment dealership management, and he is also an AEMP Certified Equipment Manager. As a Senior Product Support Manager and later as Wholegoods Sales Manager, Johns’s focus has always been on increasing sales by providing superior customer support. Once retired, he formed Mechanic and Techs and now offers a unique buffet of affordable Product Support Growth Solutions. M&T provides Consulting, Recruitment, Speciality Job Boards, On-Line Search Systems, LWS Skill Assessments/Training/Testing for those in Service, Parts, Sales, and Rental.
I have been a past student of Ron Slee’s Quest Learning Centers, and I credit that training as the foundation of my success. As a Regional Manager of Product Support and later as Whole Goods Sales Manager, I have sent many of my employees and managers to Ron’s training seminars to learn from the GOAT himself. They each returned with a three-ring green binder that held the secret of success for themselves and their employers. Using Learning Without Scars, all companies looking to grow now have a proven method to succeed.
Every dealership is looking to grow, but most are more focused on handling day to day issues
Six years ago, after 38 years in the heavy equipment business, I launched a recruiting company focused primarily on recruiting higher-level equipment technicians. Our team created a buffet of employee management services for equipment dealerships across the country centered around LWS.
About two and a half years ago, Ron and I discussed a client who was having trouble finding the number of techs they needed. As we talked, I shared with Ron my main challenge was locating and vetting qualified people. Like everyone else, I had to take a candidate’s word that they actually had the skills they claimed to have.
Considering my company offered a performance guarantee, I needed a proven method to confirm a candidates’ knowledge and skill level before recommending them to clients. Being an old equipment guy, I also knew guarantees and refunds were great, but what I valued most was hiring qualified and committed people the first time. After talking with Ron over several weeks, I knew I had found the exact answers I needed.
Ron and I took part in an equipment industry article about five years ago about the coming technician crisis. What will now follow will be a rapid rise in wages and a gradual decline in overall tech competency and efficiency. As with technicians, the last train carrying needed Product Support replacements has already left the station and is rapidly heading towards that same bridge. Thankfully, all manufacturers offer excellent technician training, so that crisis will hopefully even out over time.
LWS will be at the forefront of product support employee training. Ron and his team have been busy formatting and transferring his thirty-plus years of knowledge and teaching onto the new LWS site for the past several years. Ron’s training seminars, books, and consulting have been considered the Gold Standard for Capital Goods dealerships across the U.S. and translated into several languages worldwide. Senior managers in dealerships across the country have vetted and approved the LWS courses. An equipment industry senior service management expert developed the Technician Assessments. While the site’s content was time-tested, duplicating Ron’s unique delivery method and personality online took time to perfect. You can now visit Learning Without Scars and view firsthand what our friend, along with his daughter Caroline, and the entire LWS team have been up to for the past few years. I think you will be very impressed.
Our company, Mechanics and Techs LLC., was designed and is staffed by seasoned semi-retired equipment industry corporate managers. We have successfully managed multi-branch Service, Parts, Outside Product Support Sales Teams, New and Used Sales teams, Rental groups and worked with a wide variety of brands and types of equipment and trucks.
We combined our many years of hands-on dealership experience to create a unique selection of affordable Product Support Growth Solutions specifically designed for our equipment industry clients. We provide Consulting, Recruitment, Specialty Job Boards, Web-Based Online Candidate Search Systems, LWS Skill Assessments/Training/Testing for those in Service, Parts, Sales, and Rental.
We will introduce you to more of our services, in more detail in the coming weeks and months. I look forward to having Mechanics and Techs working with learning Without Scars for years to come. Thanks for welcoming us as a Colleague.
Did you enjoy this blog? Read more great blog posts here.
For our course lists, please click here.
Likes and Dislikes
Likes and Dislikes
Founder and Managing Member Ron Slee talks about the significance of like and dislikes when highlighting the ways we listen to our customers.
We Listen to our Customers.
We are all in the customer service business. Everyone that I know and have worked with is in a constant state of asking for help. We all ask our customers – what do you need and want from us.
In the Employee Development world, we have to listen many different influencers. The education world as to what the latest and greatest advancements in learning and retention of skills and knowledge. The Learning Management Software world to a stay current with everything going on in internet-based teaching tools. The Dealer Business Systems to be aware of the latest developments in what operational tools are available to dealers, wholesalers, manufacturers and OEM’s so that our subject specific classes are always exposing our students to what systems and processes they will be working with. The specialized software suppliers from Sales Force and CRM, Telematics and Sensors in equipment that can monitor the health of a specific piece of equipment, Maintenance tools to determine when each service interval is expected and schedule parts, labor and equipment to be available when necessary. Artificial Intelligence and all of the Data Management tools to allow information to be obtained that is useful and timely. And many more.
Most importantly we want to listen to our CUSTOMERS.
I learned that early in my life when I was being coached as a swimmer. My coach was constantly asking me to do different things with my head, my arms, my hands, my legs, my hips and my feet. He was looking for the right place for my body in the water for all of these “things.” I would be giving him my feedback and the clock would be giving us another piece of information.
It seemed so natural to me to ask questions. Then when I started teaching, I was constantly asking questions. I didn’t think anything of it until one of my bosses told me that I was using the “Socratic Method” in teaching. I had to research that and found he was right. I never really gave my class the answers to the questions I was asking. I would keep asking questions and in the dialogue that we had, teacher and students, we would come up with the answer together. I thought then, and continue to think the same today, this is the way that I would teach and that this method was a better learning tool for my students.
In my years at dealerships, I was probably a real pain as I was constantly asking why. Why do we do it this way? Why not this way? I used to ask my team members what they liked about how I worked with them. What they liked, what they didn’t like, and what didn’t matter.
When I started in our Consulting business nothing changed, although it was now expected with the job that there would be questions.
It seems that I like to know what other people are thinking about almost everything that they deal with in their lives.
When we set up our first employee development business, Quest, Learning Centers, in 1994 I started with the creation of our textbooks and our class structures. Then I ASKED. I asked a group of executives and owners and managers to come to a class that I had created, at their expense, and get their feedback. Our first classes were three days long, it was twenty-four hours of learning. We called it “What it Looks Like When it is Right.” After all the discussions and suggestions and comments we ended up with two-day classes providing fifteen ours of learning. I will be forever grateful to those individuals for their help.
Today we offer Blogs, Podcasts, Newsletters, Audio Learning and Suggested Reading Lists as Resources to our students, our CUSTOMERS. We now have at the bottom of each screen a question for the reader
It’s a LIKE button, for feedback – thumbs up or down.
I most humbly ask each of you to let us know what you think. It would be really very helpful. You will see this on most every page that you could look at on the website.
The Time is Now.
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Introducing Our Colleague Alex Kraft
Introducing our Colleague Alex Kraft
Our new guest writer Alex Kraft Started as an equipment salesperson for Flagler Construction Equipment (Volvo heavy dealer in Florida) in 2004. He worked in various positions at Flagler, ultimately serving as Chief Operating Officer from 2017 to early 2020 when Flagler was sold to Alta Equipment Company. Alex started Heave in July 2020. We at Learning Without Scars are happy to be introducing our new colleague, Alex Kraft.
For new(er) companies, the inevitable question is, ‘what do you do?’. In the simplest sense, Heave connects buyers/renters of heavy equipment with dealer sales reps.
I started my career as a heavy equipment salesperson in Miami. My manager handed me that ‘UCC’ report that showed the customers who had previously bought equipment in my territory for the prior three years. I attended a few brief product training sessions and was put in the field. The old phrase ‘you eat what you kill’ is accurate. Dealers rely on their sales teams to be the marketing department, as there are very few (if any) “leads” provided to salespeople. Days can be lonely and involve a ton of driving. It’s common for heavy equipment salespeople to drive 45k-50k miles annually. Everyone develops a common route through their territory, start at the furthest point and hit every jobsite/customer office on the way back home. Most dealerships will give their reps a target for customer calls or visits per day. Some expect 8 calls per day, for other dealers it may be 12-15 per day. If your revenue numbers lag your peers, the typical advice is, ‘well, make more customer calls!’. The truth is, most calls aren’t productive since they are rarely scheduled: the customer is busy, the customer isn’t there, or the customer doesn’t need any equipment at that time. Yet this is how the industry continues to operate.
I was amazed that still in 2020, customers had to call sales reps every time they wanted to rent or buy a machine. I’ve seen an equipment manager order Uber Eats for lunch, then call 4 different sales reps and leave a voicemail message asking for rental rates and availability. Therefore, customers are typically waiting for information. Heave exists to solve this problem. We are an aggregator website, in the mold of Lending Tree or Thumbtack. Customers come to www.heave.co and specify what they want to rent or purchase. For example, a customer this morning posted a request for quotes to buy a new 11,000-13,500 lb. canopy mini excavator in Princeton, Texas. Every dealer sales rep that has Collin County, Texas received a text message alert for this opportunity. Sales reps can quote this deal directly from their phone. Customers receive notice upon quote submittal, and they can view the quotes all in one place.
One key feature of the Heave platform is how the communication is handled. We understand that customers come to Heave because they want an easier experience that they can control. Therefore, we allow the customer to dictate the next step. Customers choose which sales reps to release their contact information to once they view the quotes. The customer clicks ‘contact sales rep’ and the salesperson receives a text with the customer’s full name, phone number, and email address. They can communicate offline to address any questions or finalize the deal.
Our initial focus since launch in May 2021 was to build a platform where customers begin their equipment search. The long-term plan for Heave is to continue adding services so customers don’t have to visit multiple places for each part of the transaction, simplifying the entire process. This past fall we partnered with Mazo Capital Solutions to offer equipment financing on our site. Next, we see an opportunity to find partners to show our customers instant freight and warranty quotes alongside their machine quotes. What used to take customers or dealers multiple calls, can be brought into one place on www.heave.co in seconds.
In my opinion, one part that is glossed over when discussing technology solutions is what it frees up suppliers to do. Everyone is rightly focused on their product and what it solves, but technology can free up supplier employees to focus their effort on true customer value add activities. For example, as I highlighted above, how much of a salesperson’s time is wasted everyday driving? Those empty miles could be better served proposing fleet solutions or analyzing telematics reports for their key customers. What value is added by taking parts orders over the phone and entering that order into a business system? With an ecommerce parts solution, parts employees could be repurposed to either manage stock levels better, run parts to technicians (reducing repair times), or deliver parts to customers. Predictive analytics could dramatically help service departments prevent catastrophic failures and better help prioritize their technician’s time. To me, that’s what embracing technology can unlock for equipment dealers- what are the menial tasks that eat up our employee’s time, and how can we utilize certain tools to provide a better customer experience?
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Incentives
Incentives
Tonight brings us another guest post from Steve Day. The former Vice President of Tractor and Equipment, Steve is discussing incentives, and how they can drive your growth in your business.
Incentives Can Drive Growth
For the majority of my career, I believed that a paycheck was a pretty good incentive for doing your job. When I worked for a manufacturer, I often got suggestions from my employees that we should offer incentives directly to our distributor employees to direct their activities more in the direction we wanted them heading. I always considered this a gross intrusion into the distributors business. As time went on, I did grow to like the idea of manufacturer incentives to distributor employees (paid through the distributor) to drive distributor employee training in areas of products and systems. Cash, trips, awards, peer recognition, all seemed to have a positive impact on employee capabilities.
When I made the move to distribution, I fell back on my old beliefs that a paycheck was appropriate compensation. I was convinced to try some experiments in incentives by some of my managers and we made some tentative tiny steps in some products. I have always been a big believer in unintended consequences so we put some safeguards in place. The results were both stunning and quite a wakeup call for me. The incentives drove growth, profitability and job satisfaction for the employees who participated.
We started out paying incentives to Parts Counter people and additional incentives to Product Support sales people. We quickly added incentives for other employees and we watched our growth in the incentivized items skyrocket.
Some of the lessons we learned were as follows:
Incentives that are properly directed will change your company. Your Part’s Department will become very customer service directed and your Counter will become a sales machine. Your Service Department will seek our more profitable work that can be planned. You will inevitably make some personnel changes but this usually ends up with getting people into spots more suited to their skills. Employees operating at the highest level will make a great living for themselves and their families while they make the company much more profitable. They will also become much more difficult for you competitors to hire.
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Friday Filosophy v.01.28.2022
Friday Filosophy v.01.28.2022
Henry Ford (July 30, 1863 – April 7, 1947) was an American engineer and businessman. He started making cars in 1896 and founded the Ford Motor Company. He developed the idea of a system in which each worker has the duty to do one small part of the process of making something. His idea made it possible to produce cars in large numbers. This was called the assembly line. Many factories around the world still make things this way. It was quite innovative at the time and it allowed him to produce many cars quickly and at a cheaper price than other car companies could. He married Clara Bryant and had one child named Edsel Bryant Ford. Ford left home for Detroit, Michigan to start his mechanical career.
In 1903, Henry Ford helped start the Ford Motor Company. He was the owner of the company.[1] The company sold its first car which was the model T car on July 23, 1903. Ford became president of the company in 1906.
In 1908, Ford’s company began making the Ford Model T car. Ford said that he wanted to make a “motor car for the great multitude”. This meant that he thought that most Americans should be able to afford to buy a car and not just a few rich people. In order to reach this goal, he chose to make the design as simple as possible. All his cars would be made the same way. They were even all the same color – black.
It cost $850 to buy a Model T car. Even though that was a lot of money back then, it was still very cheap for a car. Many people wanted to buy Model T cars. In fact, so many people wanted to buy them that Ford was having a hard time making enough cars to sell one to everybody who wanted to buy one. Ford helped develop an idea, not much used before his time, called the assembly line, and started using it in his factories in 1913. Because of the assembly line, making new cars would not take as long. He put a moving belt in his factory. Cars moved along the belt, and workers put on one part at a time. Each worker would only be responsible for putting one part on cars.
The assembly line was a big success. Cars did not take as long to make, and they were cheaper to buy now, too. By 1916, it only cost $360 to buy one of Ford’s cars, and more than three times as many people were buying his cars now. The Ford Model T changed America. It made it easier for people to live in the city instead of the country.
The Time is Now.
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Introducing Our Colleague John Sessums
Introducing our Colleague John Sessums
Our new guest writer John Sessums is the owner of Mechanic and Techs LLC, based in Baton Rouge, Louisiana. John’s career spans 38 years involved in equipment dealership management, and he is also an AEMP Certified Equipment Manager. As a Senior Product Support Manager and later as Wholegoods Sales Manager, Johns’s focus has always been on increasing sales by providing superior customer support. Once retired, he formed Mechanic and Techs and now offers a unique buffet of affordable Product Support Growth Solutions. M&T provides Consulting, Recruitment, Speciality Job Boards, On-Line Search Systems, LWS Skill Assessments/Training/Testing for those in Service, Parts, Sales, and Rental.
I have been a past student of Ron Slee’s Quest Learning Centers, and I credit that training as the foundation of my success. As a Regional Manager of Product Support and later as Whole Goods Sales Manager, I have sent many of my employees and managers to Ron’s training seminars to learn from the GOAT himself. They each returned with a three-ring green binder that held the secret of success for themselves and their employers. Using Learning Without Scars, all companies looking to grow now have a proven method to succeed.
Every dealership is looking to grow, but most are more focused on handling day to day issues
Six years ago, after 38 years in the heavy equipment business, I launched a recruiting company focused primarily on recruiting higher-level equipment technicians. Our team created a buffet of employee management services for equipment dealerships across the country centered around LWS.
About two and a half years ago, Ron and I discussed a client who was having trouble finding the number of techs they needed. As we talked, I shared with Ron my main challenge was locating and vetting qualified people. Like everyone else, I had to take a candidate’s word that they actually had the skills they claimed to have.
Considering my company offered a performance guarantee, I needed a proven method to confirm a candidates’ knowledge and skill level before recommending them to clients. Being an old equipment guy, I also knew guarantees and refunds were great, but what I valued most was hiring qualified and committed people the first time. After talking with Ron over several weeks, I knew I had found the exact answers I needed.
Ron and I took part in an equipment industry article about five years ago about the coming technician crisis. What will now follow will be a rapid rise in wages and a gradual decline in overall tech competency and efficiency. As with technicians, the last train carrying needed Product Support replacements has already left the station and is rapidly heading towards that same bridge. Thankfully, all manufacturers offer excellent technician training, so that crisis will hopefully even out over time.
LWS will be at the forefront of product support employee training. Ron and his team have been busy formatting and transferring his thirty-plus years of knowledge and teaching onto the new LWS site for the past several years. Ron’s training seminars, books, and consulting have been considered the Gold Standard for Capital Goods dealerships across the U.S. and translated into several languages worldwide. Senior managers in dealerships across the country have vetted and approved the LWS courses. An equipment industry senior service management expert developed the Technician Assessments. While the site’s content was time-tested, duplicating Ron’s unique delivery method and personality online took time to perfect. You can now visit Learning Without Scars and view firsthand what our friend, along with his daughter Caroline, and the entire LWS team have been up to for the past few years. I think you will be very impressed.
Our company, Mechanics and Techs LLC., was designed and is staffed by seasoned semi-retired equipment industry corporate managers. We have successfully managed multi-branch Service, Parts, Outside Product Support Sales Teams, New and Used Sales teams, Rental groups and worked with a wide variety of brands and types of equipment and trucks.
We combined our many years of hands-on dealership experience to create a unique selection of affordable Product Support Growth Solutions specifically designed for our equipment industry clients. We provide Consulting, Recruitment, Specialty Job Boards, Web-Based Online Candidate Search Systems, LWS Skill Assessments/Training/Testing for those in Service, Parts, Sales, and Rental.
We will introduce you to more of our services, in more detail in the coming weeks and months. I look forward to having Mechanics and Techs working with learning Without Scars for years to come. Thanks for welcoming us as a Colleague.
Did you enjoy this blog? Read more great blog posts here.
For our course lists, please click here.
The Transition from an Equipment Dealership to a Technology Platform
The Transition from an Equipment Dealership to a Technology Platform
Our new guest writer Alex Kraft Started as an equipment salesperson for Flagler Construction Equipment (Volvo heavy dealer in Florida) in 2004. He worked in various positions at Flagler, ultimately serving as Chief Operating Officer from 2017 to early 2020 when Flagler was sold to Alta Equipment Company. Tonight he brings his expertise to our readers in his blog post on the transition from an equipment dealership to a technology platform.
Alex Kraft knows all about that transition. Alex started Heave in July 2020. Heave is an equipment platform. Customers come to Heave and post an equipment need, our technology connects them with dealer salespeople, providing them multiple quotes in 1 place. No more chasing salespeople down, getting voicemail, and waiting for calls back. We love being brand agnostic and 100% focused on getting customers information that they need, quickly and with a lot less effort than they’ve had to put in traditionally.
The heavy equipment dealership/rental house couldn’t be more opposite from the “start-up” world. But my dealership experience has helped me understand what is so special about the start-up environment. I started as a heavy equipment salesperson at 24 years old. It was my first “real job.” I didn’t know much about the industry before I started my career. As a young salesperson, I did my best to try and shadow some of the more successful vets, as well as pay attention to how the overall operation ran. It doesn’t take long to understand that “this is the way it’s always been done” is a mantra that is adhered to. The dollars are huge, brand names have been established, and dealers have protected territories. When you’re younger, you naturally ask a lot of questions: ‘why do we do it this way?’ and ‘has anyone thought to _____?’ Equipment dealers, and companies in general, are full of naysayers who love to tell you the three reasons why something won’t work. I’ve worked with tons of those people. There are those that probably would say I was that person at one time. It leads to constant stasis as no new ideas are introduced. You live in a world where it feels like the culture is, ‘let’s not screw this up’ as opposed to ‘let’s get this accomplished.’
When I took the risk of starting my own company, I had an idea based on my industry experience. We were now a start-up. One major difference off the bat: there are no bad ideas. Everything is a test. It’s incredibly liberating because nothing stays the same. Our team’s internal conversations usually start with, ‘we tried this for 30 days, this is what really worked well, this is where things fell off….’. We make a tweak and do another experiment. We’d fix that issue, then something else arises. We go through the same process all over again. I understand that this can seem exhausting for some, or for others who like structure it sounds like a nightmare, but for me it became such an energizing experience. I thought back to the times in my early career and realized how draining it can be to have teammates who are always shooting things down. Yet you sit in a customer meeting, and they tell you it’s your last chance because the people change, but nothing ever seems to change at your dealership.
With a start-up, it’s very empowering to work in a climate where it’s ok to be wrong, where it’s almost expected. When an idea doesn’t pan out, it’s because we tried it and have data that tells us it didn’t work. But also, what comes out of it are nuggets that we can apply to get a little bit better. Over time, those little incremental tweaks and improvements lead to a viable successful project. This entire process is what helped our young company figure out our niche and get traction with a new product in this market. If we were stubborn and had I shot down all my team’s ideas (since I was the only one with industry experience), we’d probably have folded up the tent and I’d be talking about what could have been. This is also what leads to great optimism because you become comfortable with the unknown, since your company is in a constant experimentation mode.
The point I want to get across in this post is to encourage dealer leaders to remember that they don’t have all the answers. And that’s ok. I may be wrong, but it seems like everyone is fearful of ‘digital’ and ‘technology’ because they represent new ways in an ‘old school’ industry. You may be the market leader right now and feel that you have the most to lose if you make some missteps trying something new. Technology can be a great equalizer for some other companies who aren’t afraid of embracing different ideas. Borrow a page from the start-up culture, and experiment in certain areas. Engage your teams and try something new, whether it’s in sales, rental, parts, or service. There is a large knowledge base in the market, so you all have team members with a great deal of experience. Start on a small scale, whether it’s selecting only one location as a test or a small sample size of customers. You don’t have to try a pilot across the entire company (actually I would discourage that since it may not be manageable). Give your employees the confidence that it’s their idea, it’s all in the interests of the company getting better, and they can be wrong! Let the results speak. Maybe it doesn’t get the intended result. That’s ok, at least you tried something different, and you know. The funny thing is, I bet your customers will be appreciative, because they respect your company trying to improve, and I bet your people will have some tweaks to the original idea that will get what you’re looking for. You will probably see a new energy among your employees as well, as they feel more connected to the company and in control of their destiny.
I don’t know Ron Slee that well yet, but I’d imagine that ‘Learning Without Scars’ is emblematic of trying something and messing it up, leaving a scar to remember. When I think more about it, with my athletic background, we always learned more from losses than our wins. Yet, in business, it seems most companies are ultra-conservative and are trying to avoid mistakes. It is encouraging to see more industry specific content available on sites like this, as the dealership world has always been under the radar. Now the next step is to do something with this information and act. All your customers will benefit.
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Quality of Communication Channel – Social Media
Quality of Communication Channel – Social Media
In this blog post, guest writer Ryszard Chciuk covers the quality of our communication channel and how social media can help us with the quality of the service we provide.
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:
To improve the quality, we have to close gaps causing the discrepancy between customer expectation and his perception of service. The central gap is:
This time I am writing about social media, the beneficial source of knowing what customers expect.
I am convinced that machine operators are the most influential people in the construction industry. Dealership management makes a big mistake neglecting their power. Their influence on the purchase decisions made by construction company owners is immense, however barely visible. For example, critical factors of every buying decision are fuel consumption, production volume, and the costs of repairs. The values of those factors depend mainly on the daily behavior of operators. Thereby machine operators can have the most significant impact on a machine dealer’s success.
Other significant groups of customer staff influencing purchase decisions are site supervisors, site managers, and project managers. Those groups are affected by machines’ downtime related to the quality of service.
Do you consider those influencers in your marketing actions? How do you engage them in both party (dealer and customer) success?
How do you utilize social media?
Over 24000 Polish operators are active on the Facebook Group. Mainly, they share their photos taken on construction sites. They also ask others how to operate a machine in given conditions or what is the meaning of the red or yellow lights on their dashboards. Operators share their opinions about the quality of service, spare parts availability, and parts pricing. They ask others about the best source of spare parts. There we find short stories about problems experienced with machines. As far, I have not noticed any activity of aftersales managers.
Another place on the internet is the forum Kopaczka (only in Polish), with over 51000 registered members. There you can read about the daily problems of service technicians, mechanics, operators, and owners of small fleets (in my country, plenty of operators own just one machine and operate as subcontractors). I could not find any dealership representatives active in those media. Maybe they read about troubles their partners(?) share with the public, but nobody knows if they do anything with it. Do you utilize that kind of priceless source of information and the cheapest way of communication in a better way?
What do I expect? The dedicated representative of the dealership is active for 24 hours a day in such places. He gives valuable answers to questions asked by members. He finds solutions in the most comprehensive knowledge base: the experience of service specialists and demo operators working for the manufacturer and his dealers. Somebody should collect all those answers at the dealership website. It could become a section of Q&A in the blog or the product support chapter. The massive collection of beneficial information will soon become the primary source of knowledge for all machine users. The dealer can get an additional competitive advantage if they invent intelligent filtering and structure of that information. To make their partners’ life more comfortable.
I love saying, “Hope the best, expect the worst.” If the status quo in your marketing prevails and it is billboard marketing, you as a dealer will be a victim of internal quarrels at the customer side. For example, a company owner wants more prestige by using machines from the top shelf. The CFO prefers your offer due to the financial conditions. Project managers wish to have equipment supported by the best service, and operators are most efficient working on machines they like the most. You will never know which party is more influential. However, suppose you have established communication channels with each influencer’s group. In that case, you get a chance to learn about your company’s weaknesses. And you have an opportunity to fix them instead of waiting for the divine will.
Please keep in mind: Leaders who employ social listening — analyzing what consumers say on social media — can gain a competitive advantage by getting better insights that they can act on quickly, without incurring the higher cost of traditional approaches.
NOTE: Please look at the social media sites Ryszard is mentioning and find the parallel sites in your geographical areas.
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FridayFilosophy v.01.21.2022
Friday Filosophy v.01.21.2022
Herodotus: c. 484 – c. 425 bc was an Ancient Greek historian. He was born in Halicarnassus, a town in south-west Asia Minor (now Bodrum, Turkey)
Herodotus was called the “Father of History” by Cicero. He wrote about the ancient empires of Babylon, Egypt, and Persia, and about the Ancient Greeks.
During his life, Herodotus probably told his stories in front of large numbers of people in Greek cities. Some men at the time did this for pay. He is now most famous for his writings about the wars between the Persian Empire and the Greek city-states. He told the story from the Greek side, although the war was mostly finished when he was still a child.
In his books, Herodotus tells us that he travelled a lot. He says that he went to what is now Italy (including Sicily), Ukraine, Egypt and Pakistan. He may also have travelled to Babylon in today’s Iraq. He often used stories from people he met to write about other places and happenings.
Some people think that Herodotus wrote about things that were not true. That is possible, because he would have relied on information from various sources. His work is important because there is very little writing on these subjects before his works.
The works of Herodotus are available today in translations.
The Time is Now.
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The Business Model
The Business Model
Founder and Managing Member Ron Slee walks us through a close look at the Business Model.
Let’s Revisit our Business Model
With the famous “supply chain” issues that we have been experiencing for the past few years and the serious difficulty in finding, attracting, hiring and retaining talented people I believe that we need to seriously re-evaluate the business model which has been basically unchanged since the early 1980s. Product Support has to become more prominent in the dealer businesses, marketing territory coverage issues need to be addressed and purchasing, transportation logistics and customer service have to become not only contactless, through the internet, but also exemplary in the eyes of the customer. The other aspect of the parts and service business that needs to addressed is the market capture rates. In the past fifty years the parts and service market shares have been reduced by half, fifty percent. This not a good thing. It is a reflection that we are not covering our marketplace very well. In fact, we probably do not initiate contact, with a phone call or personal visit, with even twenty-five percent of the customers that purchase parts and service from us. This is another aspect of our business model that needs review.
This model was created in the early nineteen-eighties. This, while interest rates were running in the mid to high teens. This, after we had reduced our head counts to be able to pay our interest expenses. We have been able to withstand numerous financial cycles in those forty years. Yet we continue to operate within the same business model.
So, let’s look at this a bit.
This is not going to be easy.
The fundamental ratio of success in the equipment dealer business model was done before rental became as important as it is today. It is called Absorption. Under that model the expectation was that best practices required parts and service to be 50% of the total sales revenue for the dealership. Minimum performance as 40%. This was split to be 25% for the parts business and 15% for the service business. If you exclude the rental business for the revenue, cost of sales and expenses, including interest expense. You can use this methodology to see how you stack up.
The Rental Business today has sufficient volume with most dealers to warrant becoming a standalone option within the dealership. Either a separate company or separate division. The purpose of the rental business is primarily two-fold; generating customer satisfaction and profitability while at the same time creating well maintained good value used equipment.
The traditional dealership is equipment sales, new and used, parts and service. This portion of the dealership should deliver a minimum of 100% absorption. The definition of absorption is as follows; – The Net Income of Parts and Service divided by all the expenses for Sales and Administration as well as the inventory interest expense results in a number > 1.00.
This definition of absorption has been in use since at least the 1960’s. It is a common belief that it was created by William Blackie when he was the Chairman of Caterpillar Tractor. Early in my career I met Mr. Blackie. It is a very special memory for me. He was one of a kind. I offered to work for him as a trainee for $100.00/month. He suggested there wasn’t much he could teach me but more importantly he thought $100.00/month was a bit steep. He was kidding of course. Bill gave me terrific advice. It is something that I have never forgotten. He said that although absorption was a critical business management tool, it wasn’t all about the net income of parts and service. It was also about constraining the expenses in the sales and administration departments and putting some control on the level of equipment inventory that bore interest charges. This is a critical fact that most people choose to overlook. Parts and Service Net Income can not cover profligate expenses in Sales and Administration. Nor can it cover excess machine and attachment inventory levels.
Looking at the Parts and Service businesses we have some measures that need to be reviewed and standards determined for each according to your line up of brands and your geography. The following is a short, and incomplete list.
Sales Revenue
Personnel Expenses
Operating Expenses
Fixed Expenses
Head Count
Assets
Net Income
In the coming weeks I will break down this model in more detail and leave up to you to determine how you want to proceed. Our executives and owners today are for the most part between fifty-five and seventy-five years of age. At that age they are very risk averse. They seem to be operating on autopilot. This is a time for action. This is a time to make significant or some would say even radical change. Einstein said that continuing to do what you have always done expecting different results is insanity. I think we all can relate to what I am saying. We have yet to exploit our systems and technology. As Alex Schuessler calls it “Paper to Glass.” We have used technology to make things faster but we have simply replaced a form filled in by pen with a screen template, that looks like the form, that we fill in using a keyboard.
It is long overdue. It is time to replace the business model. The Millennials and Gen X and Gen Z are demanding it. And they are proving it with their job change statistics. Each month for the past four months over 3% of the workforce has changed jobs. That is the highest level recorded in many decades. This is a reflection of the fact that they are not going to accept the status quo. They want and need to do better. I think they are right. Care to join me with them and change our business model for the better?
The Time is Now.
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Friday Filosophy v.01.14.2022
Friday Filosophy v.01.14.2022
Ray Douglas Bradbury: August 22, 1920 – June 5, 2012) was an American author and screenwriter. One of the most celebrated 20th-century American writers, he worked in a variety of modes, including fantasy, science fiction, horror, mystery, and realistic fiction. Bradbury was mainly known for his novel Fahrenheit 451 (1953) and his short-story collections The Martian Chronicles (1950) and The Illustrated Man (1951).[4] Most of his best known work is speculative fiction, but he also worked in other genres, such as the coming of age novel Dandelion Wine (1957) and the fictionalized memoir Green Shadows, White Whale (1992). He also wrote and consulted on screenplays and television scripts, including Moby Dick and It Came from Outer Space. Many of his works were adapted into television and film productions as well as comic books. The New York Times called Bradbury “the writer most responsible for bringing modern science fiction into the literary mainstream.”
Bradbury was born on August 22, 1920, in Waukegan, Illinois, to Esther (née Moberg) Bradbury (1888–1966), a Swedish immigrant, and Leonard Spaulding Bradbury (1890–1957), a power and telephone lineman of English ancestry. He was given the middle name “Douglas” after the actor Douglas Fairbanks.
Bradbury was surrounded by an extended family during his early childhood and formative years in Waukegan. An aunt read him short stories when he was a child.[9] This period provided foundations for both the author and his stories. In Bradbury’s works of fiction, 1920s Waukegan becomes “Green Town”, Illinois.
The Bradbury family lived in Tucson, Arizona, during 1926–1927 and 1932–1933 while their father pursued employment, each time returning to Waukegan. While living in Tucson, Bradbury attended Amphi Junior High School and Roskruge Junior High School. They eventually settled in Los Angeles in 1934 when Bradbury was 14 years old. The family arrived with only US$40 (equivalent to $774 in 2020), which paid for rent and food until his father finally found a job making wire at a cable company for $14 a week (equivalent to $271 in 2020). This meant that they could stay, and Bradbury, who was in love with Hollywood, was ecstatic.]
Bradbury attended Los Angeles High School and was active in the drama club. He often roller-skated through Hollywood in hopes of meeting celebrities. Among the creative and talented people Bradbury met were special-effects pioneer Ray Harryhausen and radio star George Burns. Bradbury’s first pay as a writer, at age 14, was for a joke he sold to George Burns to use on the Burns and Allen radio show.
The Time is Now.
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