Collaborative Relationships Between Dealer Sales and Product Support Are Essential to Overall Success
From the Sales Manager’s perspective, the primary objective of a machinery dealership is to increase market share, profitability, and customer service. But, achieving these goals is often frustrated by continuous conflict between sales and parts & service.
When you objectively examine these situations, you often find mutual inter-departmental frustrations, hard feelings, adversarial relationships, and sometimes, even subterfuge. We all know horror stories of field service technicians disparaging their dealership and products in front of customers because of some altercation back at the store, or even lingering frustration/resentment for recognition or advancement given to someone else.
Under these circumstances, customers are not being served well and they are often keenly aware of these conflicts at the dealership. And, you can be sure they are probably looking at alternate vendors.
Conversely, thriving, profitable machinery dealers have a high level of inter-departmental collaboration, camaraderie, and esprit de corps, from top to bottom, from sales reps to parts counter and field service technicians. These winning teams have figured out how sales and product support can best work together for the benefit of the customer and the overall success of the business.
These organizations always have senior leadership that values placing the customer first and then, building a highly cooperative team that mutually supports each area of the dealership for the benefit of the end-user customer. And, over and over, I’ve seen the machinery dealer senior management executive that field the best team, almost always wins.
Here are fifteen dealership team-building activities that are working well today:
- Structure incentive programs that foster inter-departmental cooperation and support.
Profit-sharing programs offer an excellent opportunity. Structure the bonus payment so that 40% of the payout is for the achievement of departmental objectives and 60% for the dealership achieving performance objectives in all revenue centers (New, Used, Rentals, Service, and Parts). The overall dealership is more important than the individual department and this financial incentive drives meaningful cooperation between departments.
- Establish meaningful quantitative performance targets for each area of the business.
High-performance dealers track off-shelf parts fill rate, obsolescence, turns, first trip technician completion rate, rework, rental utilization, customer contact rate, and customer service rating scores. The most important metric is off-shelf parts fill rate. If you are not stocking enough of the right parts, nothing good happens. Achievement of these high-profit/high-performance targets will greatly enhance overall dealer support levels and do a lot to lessen friction between departments. Off-the-self parts fill is a sizeable challenge these days with supply chain issues. Many dealers can meet their performance metrics, but it takes careful working of lead times and safety stock in the stock status report.
- Train Sales Reps on Features-Benefits presentations of product support
Help your field sales reps learn how to say good things about your dealership. Hold a sales presentation contest on the features-benefits of your service and parts operations. For example, “We stock over $500,000 in parts, and our off-shelf fill rate is over 98%. This means we will have the part when you need it.” Have your service and parts managers develop key points to make in these presentations. Offer dinner gift cards for your two top presenters. Knowing things like hydraulic hose-making capabilities, and the number of field service trucks helps the sales rep talk intelligently with the customer and convey value.
- Sales Managers never make aftersales service commitments without agreement from product support
Company policy should state that no commitments by the sales team for service support are to be made without the approval of the product support team. I’ve seen a sales group commit to 24/7/365 support, yet on a Christmas day, no one was available to respond. The customer was furious. The dealer organization was torn apart by this unknown commitment.
- Include product support managers in major sales presentations
The most successful dealers I’ve seen have polished team sales presentations. The salespeople discuss machine capabilities, performance, payback, and financing. The product support people discuss uptime strategies, maintenance support capabilities, fix-before-fail programs, and routine operator maintenance. A great metric to incorporate into the presentation is “first time fix” percentage. Showing a prospective customer the percentage of how often the technician diagnoses and repairs the issue correctly can provide confidence to the customer. Quick response times mean nothing if multiple visits are required to fix the problem.
- Launch an ongoing universal Preventive Maintenance (PM) Contract sales program
These programs greatly reduce emergency breakdowns and contribute significantly to customer satisfaction. It is in the sales reps’ best interest to have as many customers as possible under a fix-before- fail program. The PM program should be sold at the time of quote, when the machine is delivered, at the next follow-up contact with the account, at the end of the extended warranty, and at the end of an existing service contract. Preventive Maintenance plans are a very big deal these days and should be quoted with every deal. However, the dealership must have the capabilities in place to execute them if they are offered. Ask me to send you the article “Are You Ready to Offer a Preventive Maintenance Program?”
- Develop a “strategic account” maintenance fix before fail strategy
Sales and product support leadership should work together to identify “strategic accounts,” The loss of anyone would be catastrophic for the dealership. Review the maintenance records for each account. What can be done to improve fix-before-fail performance? Are there units that should be replaced? What is the customer’s expectation on parts fill rate and how can a plan be structured to meet those expectations? Is operator abuse an issue? If so, this is a perfect opportunity to sell training as a value- added service. Schedule quarterly meetings with each account. Review annual repair cost history. What costs could be eliminated through a fix-before-fail strategy? Get the account to commit to working with you. Create a joint follow-up log where the OEM, Dealer, and Customer all agree on the steps for improvement and how they will be measured.
NOTE: Every strategic account has a limited set of equipment models that must be supported, and the list of the required parts can easily be determined. So, it is reasonable to deliver a very high parts fill rate, possibly approaching 96-98%.
- Collaborate to build CRM profiles including all email and telephone numbers of key contacts
The typical dealer has less than 10% of customer emails and less than 75% of phone numbers available for sales and service marketing programs. And, overall, 40% of customer information is wrong. Upgrading account information can easily be done with an intern student making customer service calls. And, account information must be available for both machinery as well as aftermarket sales efforts. Don’t fall into the trap of only storing customer profiles in the trunk of a sales rep’s car.
- Launch bi-monthly email and social media promotions.
Dealer sales reps can be 3-4 times more productive when the dealership conducts email and social media promotions. Dealer sales transactions and revenues are 8 to 10 times more from accounts with service and parts purchase frequency over 6 times per year. So, the more your sales reps can help encourage aftermarket business, the more likely the end-user will purchase that next machine from you. Embrace social media and monitor what customers are saying about your products and service. It is an opportunity to discover what other levels of the customer’s organization are thinking, not just the people you speak to in a meeting.
- Recognize and Reward sales leads, win or lose.
The smart sales rep builds a partnership relationship with the field service technicians working in his/her territory. Technician sales leads are rewarded win or lose. Every lead can be recognized on a monthly wall chart. Closed deals earn a monetary value such as dinner for two. I’ve also seen sales reps treat their technicians to an early morning breakfast in the territory, discuss account activity and monitor customer needs. This has a major positive impact on technician morale and cooperativeness. For the customers, technicians have the most credibility of any dealership employee. And, the sales rep must respect and support this valuable customer contact and influencer.
- Sponsor Customer Service Training Sessions.
Every employee should attend customer service training because every employee has to deliver customer service both externally and internally. Sales, parts, service, administrative, and management personnel attend and discuss issues as a group. Ask me to send you my free “Customer Service Training Kit” based on the book, Delivering Knock Your Socks Off Service. It includes a discussion leader’s guide and a discussion guide for participants.
- OEM Regional Sales and Aftermarket Set Example.
OEM Regional Sales and Service Reps must work closely together by making joint visits to dealers and supporting dealer initiatives such as planned maintenance programs. This has a positive impact on dealer sales reps who see their OEM field reps are a benefit to their selling efforts.
- Build and Enhance Points of Contact
To be an effective dealership and to hold on to customer relationships dealers need to continuously build points of contact from the dealership side to the customer side. A senior dealer executive just told me, “If we are a 3 by 3, meaning 3 points of contact to 3 different points of contact in the end-user’s company, we are solid. However, when we can build to a 6 x 6 or a 9 x 9 we almost never will lose an account and will be able to resolve any negative issues. I feel this level of contact is eroded in most dealerships over time.” Senior executives must encourage multiple points of contact from the dealership and prevent any one sales rep from blocking this effort in “his” account.
- Encourage the Use of Text Messaging
Don’t disregard the customer attachment to text connections in this generation as well. History has shown that while busy clients will not answer a phone call, they will welcome a text message. This is representative of our “drive-through, get it now, short statement society.” Encourage members of your customer contact team to include text messaging in their customer support efforts. There are several very good text messaging programs available to dealers today that increase the speed and convenience of communicating with customers especially regarding product support topics. “We are using Kenect (Kenect.com). It sends the inspection report and/or repair quote by text to the customer and they can provide a decision on any items that might need to be addressed by text. We get immediate response, and it provides an audit trail of what was quoted and approved or denied.”
- Eliminate “red ants.”
A “red ant” or a “fire ant” is a negative, hurtful, antagonistic, hostile, harmful employee who can upset the entire organization before 0830 in the morning. Red ants bite because they are red ants. Nothing can change their nature. Don’t let a “red ant” destroy the morale and enthusiasm and cooperation in your organization. Winning teams play extremely well together. If you have a “red ant” who wants no part of teamwork, you have to either isolate him/her and insulate your organization against this negative influence, or de-hire. Poisonous relationships can be devastating in a dealership.
Above all else – even financial reward, recognize good performance publicly and if appropriate privately. Everyone loves a sincere thank you for a job well done! Share the glory of success with all your teammates. In almost all circumstances no one individual is entirely responsible for a major sales success. It took a team to make it happen. If you have a “team” success story, I’d love to hear about it. Walt@McDonaldGroupInc.com.