Getting Better

Getting Better

Guest writer Alex Kraft faces a topic we all think about in our day-to-day lives: improvement. How do we go about getting better?

I’m a rookie at social media.  While it’s never been that appealing personally to me, I do recognize how it can be beneficial for companies to build awareness, brands, and interest.  Companies can share their successes and promote key customer relationships in an informal way that resonates much differently than the email marketing blasts.  For whatever reason, there is also a steady diet of inspirational/motivational cliché posts.  Every time I log on, I’m hit with posts from people telling the world to “get better every day,” “get 1% better today,” “crush it today.”  But these comments are empty statements.  For those of us who actually want to improve, how does one get better?  

I have a habit of always wanting to go deeper on a subject.  Two common answers to this question are practice and experience.  Both are important components but don’t tell the whole story.  How many of us have worked with someone who doesn’t hesitate to let you know, “I’ve been doing this for 26 years”, and they are mediocre at best?  Experience provides context and can help individuals be prepared for situations that arise.  You are less likely to encounter a scenario that you haven’t seen before, but that doesn’t make you better at your job.  As for practice, I’ve learned how you practice matters more than the time spent.  As an avid golfer, I was stuck at a 15 handicap for ten years, spending hours at the driving range.  It got me nowhere until I learned the art of purposeful practice.  I cut my range sessions down to 15-20 minutes with a specific goal and did it more frequently.  I dropped my handicap in half within 18 months.  What can I say, it only took me ten years to figure it out.

Within the last few years, I’ve come to understand the other pieces to what drives improvement.  In my opinion, personal growth and improvement comes from four areas: (1) trying new things, (2) forcing yourself to do things you don’t like to do, (3) having humility to recognize that you don’t have all the answers, and (4) losing.  How did I come to this understanding?  Fatherhood.  Experiencing these with my kids as they’ve grown over the past 4-5 years has helped me realize the blind spots that I had personally.  As I introduced new activities or sports to my kids, it was important to encourage them and provide support in the form of: “no one is an expert when they start”, “it’s ok to fail; we can practice tomorrow”, “the only way to know if you like something is to try it out”.  Next, I forced them to do things they didn’t want to do.  It’s funny how the things we avoid have one thing in common—they are usually the best things for us.  Whether it’s eating healthy foods, daunting exercises, hard tasks that will take a ton of time and effort, all these examples generate the most benefits.  Humility naturally comes from the flurry of questions that young children will throw at you.  As tempting as it can to be respond with “Because I said so”, a parent quickly learns it’s the least effective response.  I was forced to search for answers and come back prepared.  Lastly, losing is the best impetus for improvement.  Winning, while it feels great, often breeds complacency.  It can be taken for granted and very few understand ‘why’ they win.  No one wants to hear any critiques either—you’re a total buzzkill if you go down that road.  When you lose?  Suddenly people are more attentive during those car rides home or at those next practices.  Losing teaches us lessons, if we care about improvement, we take to heart and use as fuel to get better.  We don’t want to feel that pain of losing again.

I guess I’d found myself in a rut.  Despite plenty of ambition, it’s difficult to know whether you are improving at one’s occupation.  It doesn’t just come from more experience and more time.  I needed the refresher that fatherhood brought. The reminder of children being a blank canvas.  It’s helped me tremendously, not just at home, but professionally.  It dawned on me that I was giving advice that I wasn’t living myself.  Embracing that beginner’s mindset has encouraged me to implement new ideas at work without fear of them succeeding or not.   I’ve learned that pursuing new skills actually transfers into other areas that I didn’t realize would benefit.  For example, I find myself calmer when unforeseen issues arise.  I’m more comfortable in these uncomfortable situations, whereas my younger self probably wasn’t as helpful when problems arose.  Anyone who’s worked at a start-up is well acquainted with searching for answers and losing.  Creating something from scratch begins with an idea, but you cannot go to market based solely on what you think will work.  It’s imperative to research other company’s journeys to foresee any potential vulnerabilities or pitfalls you may have and how to navigate around these hurdles.  In this process one must put aside ego and remove confirmation bias.  Losing comes in the form of the constant ‘no’s you hear from potential customers and investors.  Ultimately losses (if you pay close attention and don’t make excuses) help build a better product, a stronger value proposition to the customer, and a better company.

To summarize, improvement is an active pursuit.  Personally, I never lacked the desire or the will to get better, but I needed to remember how it happens.  I’m confident that any parent reading this will agree that we can learn just as much from our kids as they learn from us.

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Unbiased Customer Feedback

Unbiased Customer Feedback

Today, guest writer Alex Kraft explores customer comments in this blog post on the importance of unbiased customer feedback.

Customer surveys are all the rage these days.  I wouldn’t be surprised if the kid’s lemonade stands down the street started texting a survey after each purchase made.  I had a recent positive experience that caught my attention though and is the purpose of this blog.  It isn’t necessarily about the frequency of surveys, its more about the employees’ communication to customers.  It seems like in almost every instance, the consumer is told what scores are acceptable.  It usually happens like this: “just to give you a head’s up, you’ll be getting a survey and it’s really important for us here.  Anything less than 5’s across the board hurts us”.  Of course, I don’t want this person negatively impacted by my answers.  I understand that many companies use surveys as an incentive compensation opportunity, but doesn’t this practice contradict the entire purpose of surveying for customer feedback?  Customer feedback is critical to understanding performance, market perception, and expectations.  But this approach detailed above has become all too common and misses the mark.  To me, identifying areas to improve is the most important part of customer feedback.  

So, if customer surveys are largely pencil whipped, how can an equipment dealer get real critiques?  What many do is go on a customer tour of their 10-20 largest accounts.  I understand how important it is to stay close with your largest accounts, I’m not suggesting otherwise.  But this won’t get you any closer to areas that you can improve.  These customers get the best of everything from your dealership:  best pricing, most attention, and best access to your senior level teams.  When one of those 10 accounts has an issue, the fire alarm sounds and everyone within the dealership comes to the rescue. Funny enough, you don’t need to ask as almost everyone in the dealership knows exactly what these customers’ experiences are with your company! 

I learned this lesson when I worked for a dealer and again once I started Heave.  In my dealership days, I remember meeting a large account that rarely gave us business.  We’d get the occasional rental and quote every purchase, but when it was time for them to sign the contract, the other dealer walked out with the signature.  We had one of our top salesmen on the account and he was a true professional, calling on them weekly.  I don’t remember what prompted us to ask the question, but I do remember the meeting when we just flat out asked, “what are we NOT doing that _______ dealer is doing?”  The customer described their experience with one of our competitor’s service departments as the deciding factor.  He mentioned that our competitor serviced their machines on the weekends and off-hours.  When they showed up for work on Monday, their fleet was ready to go with invoice in hand and that is why they continued to buy from our competitor.  He said, “no one else in the market has ever come close to this experience, and when we need service from the others it always interrupts our operation.”  This was a great eye opener for me as a leader.  I learned that day where the bar was for us if we wanted to earn, not only this customer’s business, but most likely many of the other top accounts in the area.  This is not something I would have “learned” from reading customer surveys. 

I visited many customers when launching Heave.  We had a vision for what the platform could look like and how we could serve customers.  There were two customer visits that stood out, as both customers told me that Heave ‘wasn’t for them’.  If I was ten years younger, I probably would have gone into a pitch trying to convince them that they should use our marketplace.  But the purpose of the visit wasn’t a sales call, it was an information gathering meeting.  For me, this was an incredible learning experience to understand from their perspective why Heave didn’t provide value.  These two meetings were pivotal in helping us shape our product and strategy. Without this feedback, we would’ve continued to struggle defining who Heave is built for and probably wasted a ton of time pursuing the wrong customers.   I can’t thank those two individuals enough for the respect they paid me by being honest and unbiased.  

Every dealership knows a group of customers who don’t really buy from them but that they know well.  These are the customers who can be incredibly helpful if they’ll give you the time and be honest.  One great quote I’ve learned years ago from an executive was, “customers vote with their wallet”.  Maybe there’s a group of customers that have quietly shifted their buying behavior towards a competitor the past few years.  We’ve all run through the list of customers parts sales- are there customers that buy parts from your dealership but don’t have corresponding service revenue?  My point is that these are the perfect interview candidates.  When you start losing business, the typical knee jerk reaction is always, ‘they must be solely buying on price’.  Rarely is that the case.  But it makes us feel better because our inner dialogue tells us that there was nothing we could do. Our job as leaders is to put the effort in and dig deeper to find out where we are falling short. The other thing worth mentioning is that it’s ok if you can’t put an immediate fix in to some of the issues that arise.  For the example I gave above about servicing equipment on weekends and off-hours: our dealership didn’t have the manpower or expertise at the time to shift in this fashion.  The point is that it’s much better to know where the bar is set than to make internal excuses or to simply not know what is driving market decisions.  This feedback helps shape long term goals within the dealership. I think you’ll be pleasantly surprised what people will tell you if you approach it in the right way and create an environment where customers feel that they can be open and that you’re asking for the right reasons.  

And a quick reminder:  when Ron sends out a survey asking whose content on his site you’d prefer to read more of, please don’t forget to rate mine near the top.  “All 5s’” for this guy…

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What Makes a Great Customer Experience?

What Makes a Great Customer Experience?

Guest writer Alex Kraft asks a question that matters deeply when you are in customer service: What Makes a Great Customer Experience?

I recently had an awful customer experience with a large retailer.  I’ll spare the long-winded details because we’ve all been there. From the 30,000 ft. level, what’s incredible is how everything falls on the customer to make things right. All I did was purchase something and now I’m the one who has to exert a ton of effort to get the refund or a resolution? How is it my problem? The experience made me appreciate what makes a great customer experience and/or great customer service. I’ve started to pay more attention to this in everyday life.

For this blog post, I don’t want to necessarily discuss equipment related themes as Ron has other contributors who’ve spent 40+ years in heavy equipment service departments. I’d rather delve into what factors into a positive customer interaction. What makes customers want to come back to your business?

Two major components that we all appreciate as consumers are competence and a ‘give a damn’ factor. Competence is something that you can recognize very quickly and puts a customer at ease. I think of a restaurant. We’ve all had a server that within 60 seconds you know will be attentive, knows the menu, and has a great demeanor. It makes your entire experience better knowing that the person waiting on you is competent. It doesn’t have to be a five-star restaurant either, this can be your local chain or even a coffee shop. We’ve all had the opposite as well: where the server is overwhelmed, isn’t able to answer questions concerning the menu, blames the kitchen, and has a poor attitude. Many times, we wonder, ‘why is that person a server if they don’t like interacting with people?’

I’ve had ongoing shoulder pain for a few months. Upon returning from vacation, I decided that I had to do something, so I booked a massage. When I arrived, I told the therapist about my shoulder. Just by looking at me, the therapist says, “your hips are out of alignment, your right shoulder is higher than your left, and it looks like your right leg is a tad shorter than your left. All of these things contribute to your shoulder pain”.  Before the massage began, I knew that I came to the right place. Afterwards, I’ve made a couple adjustments to my daily routine, and voila! My shoulder feels a lot better. Apply that to your teams. You don’t necessarily need a customer survey to have an idea of how your people represent your company. Does your sales team exude competence when dealing with customers? When you speak with your sales team, do they speak in generalities or do they have a command of your products and their customers? Do your parts and service representatives embody competence when customers need help?

My personal favorite is the ‘give a damn’ factor.  I don’t know of any formal ‘give a damn’ training classes, but maybe Ron will add one to his curriculum. What I’ve seen happening at more companies than I can ever remember, are employees that are quick to tell you that they can’t help you. This manifests itself as ‘I’m sorry, that’s not my job’, or ‘sorry, I can’t help with that’, or “you’ll need to speak to ______”. While I was waiting at this large box retailer, the person in customer service answered the phone with ‘How may I direct your call?’ They couldn’t pass the customer off fast enough.  Yet every single company touts their “customer service”. What customers want is to feel like their issue is YOUR issue as a company. They want someone to take ownership of their problem and see it through to resolution.

You don’t have to be an expert to give a damn. Those employees that understand this concept personally see to it that the customer ends up with the appropriate person who can solve their problem. They don’t make the customer start all over from the beginning, try to find someone else, and retell their story. Companies that are great customer service companies make sure to drill these points home to everyone. This isn’t ‘going the extra mile’, it should be what’s expected on a daily basis.

We find reminders every day of great customer experiences. I encourage you when you’re at lunch, at the doctor, Whole Foods/Publix, wherever you visit, compare those visits with how you believe customers feel when dealing with your company. Like I mentioned above, we don’t need surveys to tell us certain things. If you’ve been at your company for a while and know your people, I’m sure you have a good idea. Trust your instincts, maybe it’s time for some refreshers.

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Positioning: Who Are You For?

Positioning: Who Are You For?

 

Guest blogger Alex Kraft discusses positioning in today’s blog, with the important question of who you are positioning yourself for? Who is your message meant to target? Are you a partner to your customers?

When you work for an established company, there are certain things that get taken for granted. Customers in the market know your brand and they’ve experienced your products. Opinions are formed based on experience. For young companies, the art of positioning becomes incredibly important.

Wikipedia defines ‘positioning’ as ‘the place that a brand occupies in the minds of the customers and how it is distinguished from the products of the competitors”. How do potential customers perceive your product when they haven’t experienced it and it’s not established? What I’ve learned over the past 18 months is: words matter. It’s remarkable how certain words trigger different responses and can create opportunities or worse, close doors in your face.

One of the major challenges with positioning is that everyone seems to use the same words, regardless of whether they are accurate or not. As I’ve written before on this site, Heave in its simplest form allows dealers/sales reps to quote contractors equipment (for rent or sale) easily on their mobile device. I’m very proud of what we’ve built so far and couldn’t wait to tell the industry….so terms like ‘platform’, ‘marketplace’, ‘e-commerce’, found their way into our positioning. The problem is that every tech company says that they are a platform/marketplace/e-commerce solution. The result is that you get drowned out amongst the crowd and no one remembers anything. Even worse, a customer will just assume your product is the same as one that they’ve maybe had a poor experience with, because of that similar description (without even trying it!).

For equipment dealers, it’s similar. Pick a dealer, any dealer. Don’t tell me who they are, let me guess: do they have the ’best’ or ‘quality equipment’, with ‘THE BEST SERVICE’? Are they ‘customer first’?

Are they a ‘partner’? I remember when I started as a Volvo salesman and attended a factory training session. Naturally I wanted to learn the areas where we had a competitive advantage, something tangible. One thing that I left armed with was Volvo’s superior fuel economy compared to the competition. Unfortunately for me, I was flipping through a Construction Equipment Guide the next week and I see ads for Case promising the ‘best fuel economy in the industry’, same as CAT, Deere, and Komatsu. Now Volvo is just another brand promising the same thing as everyone else. I had to go back to telling customers we just had the ‘best service’….

With Heave, we created something new and started with a blank slate. I became frustrated early on as we met people in the industry. ‘Why don’t they get it?’, I would ask one of my partners. It seemed so simple to me, but I lived it every waking moment. The more I read and researched other companies, the more I came to understand how important positioning is, and how it can set companies apart. I didn’t realize the skill involved in articulating an idea concisely with an economy of words. Once I had an appreciation for the nuance involved, we began tweaking our positioning. As we met with clients you could tell that it was resonating more, and we were getting closer. The final ‘aha’ moment for me was something that I believe every dealer/OEM can also learn from.

Positioning goes together with identifying a target market. A mistake that I know well is not recognizing your ideal customer. In the early days of Heave, I was afraid that if there were 100 potential customers, we needed to appeal to all 100. We couldn’t afford to have a smaller potential pool of customers I thought. Thankfully, I came across a sales trainer named Josh Braun. Josh’s content opened my eyes to how successful salespeople don’t try to sell or pitch to everyone; they focus their efforts on those who fit the solution. It finally clicked for me. Heave is not for the 15-20- year veteran salesperson who has the same 15 accounts for the past 10 years. Heave is for the younger, inexperienced, hungry sales reps who are new(er) to a territory and building their book of business. Have you ever noticed that those who say that “it’s a relationship business” are the ones who’ve had the relationships for 20 years? That saying is code for “this is MY customer, go find someone else!”  This exercise was incredibly liberating for our team because it brought clarity to our mission and removed a ton of pressure. Now we weren’t wasting time talking to those who weren’t a good fit for our product. Do I believe that Heave could help that 15-year veteran salesperson? Of course, but why push a boulder uphill? Go talk to the 50,000 equipment salespeople in the US who are tired of cold calling offices and jobsites, that keep showing up and never get past the gatekeeper. Their manager offers solace by telling them, “Don’t worry, it’s just part of it.  It took me 24 months to get my first crack at quoting Contracting. Now they buy 5 machines per year from us.” That is our ideal user and our positioning followed. Now we were speaking directly to them.

While equipment dealers aren’t starting with a blank slate, there is opportunity to stand out since everyone has been using the same terms since the 1960s. Don’t make the mistake of just copying the competition. You don’t have the same resources as the competition, and you don’t get credit for the ideas if you just are copying what someone else does. Who are the customers that your competition doesn’t serve? Maybe this fresh positioning could be tied to embracing the technology driven changes occurring in the industry? Maybe your positioning can be focused more on certain products or customer segments? On second thought, consistency is your friend, and you can’t go wrong with ‘We take customers to lunch, sign paper contracts, and we stock a lot of parts.”

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Business Friction

Business Friction

Friction is a fact of life. In our industry, friction calls engines to mind. Today, our guest writer Alex Kraft defines and explains friction in business.

I’ve always been interested in how words and terms find their way into common discourse, seemingly out of nowhere.  The last few years, the words ‘culture’, ‘friction’, and ‘AI’ (Artificial Intelligence) are constantly mentioned.  I’m not smart enough to break out ‘AI’ and culture is a bit played out at this point.  I wanted to dig a little deeper on friction, specifically what type of friction exists in the equipment dealer today.

What is ‘friction’ in business?  I typed that phrase into my Google machine, and this is what returned: “anything that prevents or dissuades customers from buying your products or services”.  I was reminded of a great Bill Belichick quote the other day that made me think of friction in business.  Belichick was addressing the team after a key loss to a rival and his message was, “you can’t win until you keep from losing”.  The parallel that I see between what Coach Belichick professes and friction is that they are self-inflicted.

In football, teams prevent themselves from winning by turning the ball over, committing penalties, or mental lapses forgetting to cover certain players, dropping passes etc.  Equipment dealers prevent themselves from winning in a variety of ways.  The first example can be a bad experience with a company’s website.  How does your website look on a mobile phone, where 70% of all traffic views web pages?  What can a customer do on your website? Can they get pricing?  Can they schedule a service or buy parts?  If your website just has online forms (do you fill out forms on websites?) or ties to an OEM page that lists machine specifications, is it advancing your brand or generating interest in your company?  Another practice that I’m sure keeps dealers from winning is the lack of pricing transparency online.  The industry has struggled with this for eternity.  I started as an equipment salesperson in 2004.  I’ve competed against all the major brands.  I’ve had customers show me hard copy quotes from all my competitors.  Yet, when I look online at dealer’s websites and their online listings on sites like Machinery Trader, the pricing displayed is not true market pricing (I’m being polite here). What is the purpose of showing pricing online if it isn’t actionable?  If customers stumble onto your site, how many are turned off and don’t inquire?

The last example that I’ll explore concerning friction in equipment sales is the prospecting/quoting process.  Dealers have outside sales teams that are taught to cold call jobsites and customer offices.  Talk about friction. If a customer needs pricing or information, they must call a salesperson.  What if I don’t know who my [insert brand] salesperson is?  Friction.  Most dealers don’t list their salespeople on their website with contact information. Friction.  If I’m a customer and I want to compare quotes, now I call multiple salespeople? Friction. What if there’s been a change in sales reps? Friction.  If I miraculously get someone on the phone, do they have the answer right there for me?  Most likely, no.  They must call me back.  Friction.  Ok, it’s been a few days, but I have my price.  Is it your best price?  No, it’s negotiation time.  Friction.  Best case, everything has gone well, you’ve breezed past all these hurdles, now it’s time for that sales contract and finance application process.  I’m sure all your documentation is electronic?  Friction.

The basis of friction in parts and service is the effort required for customers to get anything done.  Online parts ordering is still in its infancy and many dealers/OEMs don’t even have it yet today.  This leads to customers calling a landline, hoping to get someone to speak with to order the correct parts. Reporting a service issue is similar- call a landline and hope to get someone on the phone (how often do you get right through?).  Maybe some customers text your local dispatcher.  What happens when that person is out sick, on vacation, at lunch, or leaves?  If you believe I’m exaggerating, call the phone numbers listed on your website to put yourself in your customers shoes.  I’d wager that you won’t be pleased with the findings.  After the initial conversation, what is your communication like with the customer regarding status of technicians and estimates for the repair?  Many dealers still don’t provide estimates before working on the machine.  Invoicing the customer for work performed when they have zero expectation for what the repair cost is a perfect recipe for customer dissatisfaction.  Not to mention how long it typically takes to invoice the customer.  All these facets add up and can make customers ask themselves, ‘do I want to do business with this dealer again?’

Circling back to Coach Belichick’s quote, what I’ve described here is all within a dealer’s control.  Nothing mentioned above has anything to do with your competition.  I’m afraid that for years equipment dealers run through these processes and think to themselves, ‘well, but our competition is the same and we aren’t any worse’. If that’s the case, imagine what kind of employees you can recruit with that slogan and what your sales pitch is to customers!  I encourage leaders to look within your departments and using another Belichick term, self-scout.  The tendency has always been, look at our top 10 customers and see what their experience is like.  This is a flawed approach because their experience is not the reality for the other 98% of your customer base.  The goal should be figuring out how to offer those 98% the same level of A+ service the top accounts enjoy.   We are in a different time today and there are many tools available that can help dealers solve legacy issues.  If you take all the possible reasons for customers to say ‘No’ off the table, you may just end up with a growing piece of your competition’s market share.  Ask yourself, when was the last time the New England Patriots gave a game away?

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Adaptability

Adaptability

Guest writer Alex Kraft tackles the importance of adaptability for all of us in our businesses, and our lives.

In order to Succeed you have to be Adaptable.

What do Nick Saban, Domino’s Pizza, and Ritchie Brothers Auctioneers have in common?  Adaptability.

Every equipment dealer everywhere has uttered the words, ‘because that’s the way we’ve always done it’. I’ve heard it a million times and I may have said it once or twice.  Adaptability is becoming a larger separator between the dominant players in an industry and the middle/lower tier companies.  I’ve always been impressed by market leaders that continually work to improve and adapt to changing market conditions even when they don’t have much incentive to.

As a huge sports fan, I’ve always enjoyed the parallels between sports and business.  Nick Saban is undoubtedly the most successful college football coach ever, having won seven national championships.  For those who don’t follow college football closely, they may view him as a hard ass, but to me his success stems from a willingness to adapt.  Saban’s early teams were the conservative type, focusing on suffocating defense and a run-first offensive approach that limited mistakes.  No one could argue with the approach as SEC titles and national titles piled up.  If there ever was a person who could rest on his laurels and point to the “this is the way we’ve always done it”, it was Nick Saban.  But what makes Coach Saban a legend is that he’s never satisfied and he’s constantly seeking improvement.  Even with his extraordinary success, he looked at the teams that beat Alabama and noticed similarities with their offensive schemes.  The rules had changed in the early 2010’s to lean more towards the offense, specifically the spread passing scheme.  Instead of being stubborn, Saban leaned into the new age offensive schemes and Alabama has become the most dangerous passing program in the country over the past 4-5 years (averaging almost 48 points per game!) with 11 1st round picks on offense since 2019.  Football fans have all seen the examples of the legendary coach in his last few years struggling to adjust to rule changes, differences in athletes from prior decades, and the overall style of the sport.  It creates this sad state where we all think to ourselves ‘the game has passed him by’.  I don’t ever see anyone suggesting that about Nick Saban because of his incredible ability to be open minded and adaptable.

Domino’s Pizza was near bankruptcy in 2008 as its share price dropped below $3 per share (today it’s >$400 per share!) and they were losing franchise locations.  This led to a few changes including the launch of some new products and a completely new pizza recipe.  Next, they launched a campaign with a promise to deliver pizzas in “30 minutes or less”.  When the competition just copied the program, Domino’s was searching for an edge.  The true catalyst that changed the entire company’s future was their ability to adjust to the smartphone revolution and embrace digital ordering. In 2011, then-CEO Patrick Doyle challenged the internal team to create tools to allow customers to order a pizza while waiting at a stoplight.  The average stoplight takes 17 seconds to turn green and Domino’s has 34 million different possible pizza combinations.  Impossible?  Quite the opposite.  Anyone who’s ordered a Domino’s pizza in the past 5 years can attest to the ease at the entire process from order to receipt.  It isn’t just about launching an ‘app’.  Domino’s was at the forefront of the “pizza tracker”, along with experimenting with autonomous delivery vehicles and electric bike deliveries in certain markets.  The Domino’s AnyWare program allows customers to order directly from consumer 3rd party ‘apps’, such as Slack, Google Home, Amazon Alexa, a text message, a Smart TV, or even a tweet!  Today, over 60% of their orders come from digital channels.  With such an intense focus on customer experience, Domino’s launched an ‘Innovation Garage’ to continually test and implement new ideas.  This culture has changed the entire perception of the company, to where they are more often characterized as a tech company than their standing as the world’s largest pizza company.

Ritchie Brothers Auctioneers is a great construction industry example of adaptability.  I just attended the big February sale in Orlando as I have every year since 2008.  The RB Auction has become a destination, a networking event for so many in the industry over the years.  One would think that a pandemic such as Covid-19, which brought ‘social distancing’ and outright travel restrictions would absolutely crush a company that holds in-person auctions, right?  Wrong.  Long before Covid-19 struck, Ritchie Brothers Auctioneers laid the foundation for online bidding at their in-person auctions. Ritchie introduced online bidding back in 2003, but it was their IronPlanet acquisition in 2017 that cemented their leadership position in selling equipment online.  I was surprised to learn that prior to Covid, Ritchie’s online sales exceeded their in-person sales.  Having been in this industry since 2004, I can’t imagine how much resistance RB must have had internally when the idea of selling used equipment online was posed.  Especially for a company that started in 1958 auctioning furniture at a rented hall.  It seems like a stroke of genius today with our current conditions, but those seeds were planted long before it was popular.

The 3 examples above are success stories.  Unfortunately, there are plenty of examples of the opposite, of rigid companies like Blockbuster movie rentals.  At its peak in the late 1990’s, Blockbuster had over 9,000 video-rental stores, employed over 84,000 people, and had 65 million customers.  The story is well known now that Netflix basically begged Blockbuster to buy their fledgling operation in early 2000 for only $50 million.  Blockbuster turned them down and today Netflix is worth $195 Billion, and Blockbuster is out of business.  This is the ironic part to me:  if I’m chasing a competitor, I’d want them to keep everything the same. Please don’t change.  Yet that seems to be the trap that most in the equipment industry have fallen into.  If you’re 3rd/4th/5th in market position and you’re not pursuing new ways to do business, what do you think happens next?  No one just falls into a better market position by staying the same.  Learn to adapt or you may just be holding a position for someone else to come and grab on their way up.

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Customers Value Their Time

Customers Value Their Time

Guest writer Alex Kraft talks about the importance of time, and how much your customers value theirs, as he continues to explore the ways in which technology has shifted our sales.

“No one will buy a $250,000 machine online”!  “But this is a relationship business!”  I’ve heard those 2 comments repeatedly.  First, Ritchie Brothers and Bidadoo have sold Billions (with a ‘B’) of equipment online, as-is where is. The crowd that clings to those two statements are missing the greater point:  the shift towards online transactions is due to customers placing more value on their time than ever before.  Why fly to an auction site when I can bid or buy the machine online without any interruption on my daily routine?  I was reminded of this the other day when I was speaking with a construction contractor who owns his company.  His insight is incredibly relevant since he started his career as an equipment salesperson and therefore knows both sides of the supplier/consumer dynamic personally. When we were discussing the growing influence of technology in the equipment industry, he mentioned to me: 

“As a salesperson I was trained to call on customers in person every day. Now that I’m on the other side, I’m always squeezed for time.  We’re trying to grow our business.  I’m out trying to land jobs for our people.  I don’t have time to meet sales reps for a beer or go to dinner. It’s nothing personal… If I’m not in the office or on one of our jobsites, I want to be with my family.”.

This is a common refrain.  It can be difficult to look at something through another person’s eyes, especially when it impacts you.  But think about your customers and how many different vendors are trying to build that same relationship.  For example, there are OEM dealers, independent dealers, rental houses, and service providers (auction companies, tire vendors, freight companies) all competing for that customer’s attention.  My contractor friend told me that he is called on by 30+ different vendors in a normal month.  This was incredibly eye opening for me, because I just assumed that it was just our dealership and our two biggest competitors that were calling on my friend.  

There are positive and negative aspects of technology and its effects on our culture.  I am amazed to see how many people will order a Starbucks coffee online to avoid the possibility of a five-minute wait.  One could argue technology has made us impatient and has created some real first world problems.  But there’s clearly a disconnect between construction customers and their vendors with how they want to interact.  Customers are working on jobsites coordinating and managing large teams against tight timelines and budgets.  Yet, equipment dealers encourage and push their sales teams to continue showing up unannounced on jobsites or offices with no real agenda other than ‘do you need anything?’  How is this productive and still part of the daily routine in 2022?  

I’m not suggesting that customers don’t want salespeople to exist.  The difference is customers want dealer salespeople when they want/need them.  This is the definition of the ‘on-demand’ economy. It’s possible to build relationships with people while relying more on digital experiences to communicate.  If dealers embraced these tools, their sales teams could be more prepared to serve their customers.  Every interaction could provide value thereby strengthening the relationship instead of wasting each other’s time.  Smart business is about listening to customers, and those that ignore this reality will probably create openings for their competitors that didn’t exist before.

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Equipment Sales in the “On Demand” Age

Equipment Sales in the ‘On Demand’ Age

Guest writer Alex Kraft Started as an equipment salesperson for Flagler Construction Equipment (Volvo heavy dealer in Florida) in 2004. Tonight he brings his expertise here on the topic of managing equipment sales in the “on demand” age.

Selling equipment used to be so easy. Or that’s what I thought when I listened to the old timers tell me stories of taking a customer out and signing a “million-dollar order on a cocktail napkin”.  Then that damn internet came along and ruined everything! Truth is buyer behavior has changed. According to a recent McKinsey B2B study, there’s been an 85% increase in the preference for buyers to conduct online research, and a 238% increase in buyer preference for self-serve looking for information on the companies’ website.

The evolution of the sales profession is not just impacting the equipment world. There is a larger societal shift at play. For example, when I was younger, my perception of a salesperson was the Alec Baldwin character from the ‘Glengarry Glen Ross’ film.  Baldwin’s character berates a sales team with his hard charging, second place is for losers’ mentality (in the movie 2nd place gets a set of steak knives!).  Success was the result of those who simply ‘do not take no for an answer’.  Today’s sales culture is much different. Training materials focus on skills such as listening, empathy, and personalizing a solution.  I read a blog post today which mentioned the importance of understanding your prospect’s needs and not lumping all potential customers into the same broad category. I’d love to take a trip back with a time machine to see the Baldwin character’s face when someone mentions “empathy” as a key to closing deals!

What does that mean for equipment salespeople?  First, it does NOT mean that salespeople are less valuable or that they will be unnecessary. To me, the job has changed. Customers aren’t basing their decisions anymore on who takes them to Ruth’s Chris or lunch twice a week. The most important trait for a successful equipment salesperson is responsiveness. What separates the best salespeople from the average is what they do AFTER the sale. Those that take ownership of issues that arise and solve problems are the salespeople that foster loyalty.

The best comparison I can make is to the medical sales industry. If anyone knows someone in the medical sales industry, you’ll know that a medical ‘salesperson’ typically doesn’t handle pricing. Instead, they focus on managing ‘cases’ or supporting the doctor’s usage of the products. Another industry that we can draw from is real estate.  Everyone is a real estate expert today due to the unprecedented accessibility of information, but there have never been more registered real estate agents. Despite this dynamic, an agent that helps a buyer through every step of the process is worth every penny.

Since more customers perform online research, they are more educated on the products than ever before. There are fewer unique brand features that a salesperson can point out to a potential buyer. One area that I see a huge opportunity for salespeople to take advantage of is the focus on telematics data. Every OEM/dealer is touting their telematics data capability and the amount of information available. The problem becomes who’s going to read through all that data? Great salespeople are ‘advisors’ for their customers, and what better opportunity to be an advisor than to use the data available on your customer’s machines to provide valuable insight on how they operate their fleet. How powerful could it be for a salesperson to come to their customer, with 3-5 observations on their fleet performance for a specific job? Do you notice certain operators that can benefit from additional training? Are there potential looming issues on machines due to fault codes? Another area that customers seem to struggle with is when to dispose of a machine.  Great salespeople know the market (like real estate agents) and could utilize their network to help customers maximize value for machines as they reach the end of their life cycle, so customers don’t always have to send machines to auction.

In summary, what do all customers seek from their vendor relationships? Value and support. As I’ve outlined above, customers’ definition of value has changed, so it’s time for dealers’ expectations for salespeople to adjust as well. That begins with redefining what a salesperson profile is. Some of the best equipment salespeople that I’ve ever seen were former mechanics.  Their technical aptitude became a huge asset for their customers, as they could help troubleshoot issues, relay information to their service department, and in a pinch even turn a wrench themselves. Salespeople who continue operating with the belief that their job is solely to quote pricing, buy lunch, and push all other duties to another department will become very replaceable, very quickly.

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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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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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