One of the comments I get from dealers on a regular basis is “I wish we had all the brands! I could really sell some equipment!” The reason the title to this article is “Careful What You Wish For!” is because having all the major brands is a lot more complicated than it sounds and the payoff is not always what you would expect. Often the expectation of having multiple brands is an open door to growing sales. In my 17 years of working with commercial dealerships and many “multi-brand” commercial dealers, here are some things to think about before you expect sales to just fall into your lap:
- Start slow if you have just acquired a new franchise. You need to know if the new store already has an equipment department and the skill level of the staff, especially if there is an existing manager and you have one at your other stores. Even if the new dealership has a small equipment presence, many of the retail staff have sold those pieces even if they were not certified to do so. Tread carefully with these staff members.
- Allowing all of your staff to sell all brands can be a nightmare. It often causes infighting and hard feelings, but more often there is a lack of product knowledge that is so important to equipment customers. Also consider the manufacturer’s requirements regarding staffing. Plus, there is often a “brand preference” by the sales person. Which brings us to point number three:
- Don’t try to talk a prospect into a different brand when he or she already has a brand preference unless there is an overriding technical reason. What often happens is they go to a competitor. Brand loyalty can be a powerful thing, and even the sales person has preferences.
- Make sure at each store there is a full time person for a brand and set parameters on how you refer sales to each brand. This promotes a team concept between the stores and everyone wins. It is difficult when you are new to business and every sale counts. One of our dealers has an incentive for giving away the referral of $150. Everyone wins and the money is more than made up for in sales that would have been lost.
- One manager or multiple equipment managers for each brand? If you have two brands one person can usually manage both stores (Check your manufacturer’s requirements) or two stores of the same brand. Once you get to three or more locations it becomes complicated and very time consuming, especially if the brands are farther apart. This is a great opportunity to appoint “assistant managers.” They can report to the main manager and will begin to learn the skills of sales management and leadership. In most cases these will be producing assistant managers. This requires a weekly conference call between the main manager and the assistant managers and in turn weekly staff meetings at each store. If each location grows into a staff of three or more sales consultants it’s time to consider separate managers and possibly a director over the entire department.
- What about one location for all the brands. Most manufacturers have strict rules about mixed inventory. Make sure you consult with your manufacturer’s rules before combining inventory from more than one brand.
- Managing inventory as well as who orders inventory can be difficult. My usual recommendation on inventory that is not part of the “pre-ordered” inventory for a customer is to stock three times the inventory that you anticipate selling in the nearest month. Multiply this times three brands and it will seem like a lot of inventory but it is necessary to continue to grow the business. Make sure whomever is managing inventory knows pieces of equipment.
- Teamwork will be your key to success! This might be the main reason for a single manager or director. One of the dealers with whom we work with is truly a team effort. Everyone cares about the other brands success.
There are more things to consider with multiple brands, this article is just a starter. Please email me at firstname.lastname@example.org if you would like to receive our detailed checklist on making multiple brands work together as a successful team.
About Ken Taylor: