One of Equipment Trader’s™ frequent partners – Commercial Truck Training – helps dealers develop commercial inventory departments from scratch. Yet too often, after their team leaves, the dealership’s top management stops following their expert advice and institutes new systems based on faulty assumptions about the equipment industry. These mistakes are classic cases of “fantasy vs. reality.” To help you avoid falling into these misconception pitfalls, we’re debunking 6 myths about equipment sales that don’t match the reality of the industry, along with our recommendations for each situation.
Myth 1: “More is better. If we can double our sales calls/meetings, we can make twice as many sales.”
Reality: If sales consultants are already scheduling 4 – 6 quality appointments a week, in addition to their day-to-day tasks, follow up calls, bids, events, paperwork, and dealership meetings, then their time is maxed out. If you increase your sales team’s expected sales calls/meetings, then either they will fall behind on their daily work or their appointments will become unplanned and low-quality. Work smarter, not harder, by emphasizing quality over quantity.
Myth 2: “Always ask for the prospect’s business on every sales call/meeting.”
Reality: This “old school” approach provides the illusion that you are driving the sales process forward, but that is a strategic mistake. On your first appointment, your primary goal is to simply get a second and third meeting. While people make retail purchases based on emotion, heavy machinery purchases are based on need, which means that instead of hoping to capitalize on a buyer’s impulses, equipment salespeople must build longer-term relationships with their prospects. Only once there is familiarity, trust, and added value does a salesperson have the right to ask for a prospect’s business; being too pushy before then can turn off machinery consumers. It is rare that a prospect demonstrates enough interest on the initial sales call to justify giving them a full sales pitch.
Myth 3: “I don’t need to stay in contact with my good customers; they love me.”
Reality: In today’s world of professional selling, competitors will try to poach your customers from every direction. That’s why we recommend dealers have a “Top Customer List” of your most important and loyal clients. Dealers should pick five of these top customers a week to either meet or make a telephone call. Relationships may be founded on trust, but they continue on thoughtfulness. Keep your top customers at the top of your mind, and you’ll be able to keep your business at the top of their minds.
Myth 4: “If I give prospects and customers the lowest price, I will win their business.”
Reality: Equipment customers don’t just look for the cheapest up-front price; they want the best overall value for their business. Instead of gashing your unit prices, try to offer higher quality service than your competitors. Priority servicing of consumers’ machinery may include first-bay availability (bumping them to the front of the service line when their equipment need maintenance), off-site servicing, and/or offering loaner machinery. Providing the best ongoing, overall value can not only increase your sales, it can also boost your retention rates significantly more than cheap unit pricing could ever accomplish. If you only focus on providing the lowest initial price, and not on overall value or healthy prospect relationships, consumers are likely to leave you for the next dealership that comes along with a lower price.
Myth 5: “Every member of the sales staff should be required to come in on Saturday.”
Reality: When a salesperson is required to work Saturday, they typically get a day off during the regular business week. This arrangement works great for retail sales, when shoppers are free from their own work and might buy a personal item. However, machinery purchases are most often made by business owners working on behalf of their company, which means they’ll be researching and purchasing units during regular weekday business hours when they’re at work themselves. If you force your equipment team to sacrifice a weekday to be at the dealership on a Saturday, you’ve given up a day of prime selling potential for a day when business owners are much more likely to be fishing than at your dealership.
Myth 6: “I should put new salespeople on traditional 90 day draws against commission.”
Reality: Expect to lose your employees – and the leads they’ve been nurturing – at the end of the 90 days. Businesses only buy heavy machinery when they need to, which means a new-hire may lay extensive groundwork for future sales by building quality prospect relationships, but may not have had many actual opportunities to close sales in 90 days. If they experience a sharp decrease in pay at that time, you are likely to lose them and the profit they were going to bring in if they’d had more time. The nature of the equipment business means that salespeople need a significantly expanded draw period. However, this does not mean you have to wait a full year to know if you’ve hired the right person; you should start seeing hard evidence of relationship-building and right-to-quote agreements (in which a prospect commits to giving the salesperson a call for pricing when they need new machinery) within the first few months.
Often the fantasies of dealership management don’t match the realities of the equipment industry. We hope this article helps you avoid such misconceptions and mistakes, and instead maximize the time and efforts of your equipment team. And if you’re looking to expand your marketing efforts, consider listing your machinery on Equipment Trader. Finally, we want to hear from you – which mistaken myth do you think is most common in dealerships? Let us know in the comments below.
About the Authors
Ethan is a Content Curator for Trader Interactive, serving the brands Commercial Truck Trader, Commercial Web Services, and Equipment Trader. Ethan believes in using accessible language to elevate conversations about industry topics relevant to commercial dealers and their buyers.
As the Founder and President of Commercial Truck Training, Ken has consulted, coached, and trained commercial dealers on individual, regional, and national business levels. Known as an industry leader, Ken has worked with companies like General Electric, General Motors, FCA, Ford, Commercial Truck Trader, and Equipment Trader.