Equipment Dealer Strategies for Growing Sales

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Equipment Dealer Strategies for Growing Sales

Guest writers Steve Clegg and Debbie Frakes return with their blog this week covering the ways you can create lifelong customers in “Equipment Dealer Strategies for Growing Sales.”

The key to sustained success in selling equipment, parts, and service is to create long-term customers. And creating long term customers comes down to following several equipment dealer strategies that show your customers you care about their businesses and are invested in helping them grow their businesses, and that you know what works. Here are the golden rules for dealers that you need to follow:

  1. Never make your problem the customer’s problem; they have enough problems of their own, which is why they are calling you.
  2. Always say YES! Then, the question becomes when and how much.
  3. Be proactive and contact the customer before they contact you.
  4. Manage your customers’ expectations. Customers often don’t remember what you told them; they only remember what they expected to happen.

In this article, we’re going to cover these rules and strategies, and how they make you more effective at selling equipment, parts, and service, all while developing more loyal customers. 

Be positive with customers and say YES! 

When talking with customers, you should always be finding a way to solve their problem. For example, if one branch doesn’t have the part they need in stock, find the part at another location, and tell the customer when they will receive it. You don’t want to tell a customer that you can’t do something, you want to tell them how you can. If you start with a positive reply of what you can do, there’s a 70% chance of closing compared to a 50% chance if you start with a no. If you’re the dealer that can effectively solve their problem, then you will continue to be their source for equipment, parts, and service for them. 

How to respond when a customer needs a product or service from you. 

Being positive and solving the problem shows the customer that you understand their needs and care about their problems. Here is an example of the hierarchy of responding to customers: 

  1. Tell them you have exactly what they need and when you can get it to them. 
  2. If you don’t have it at a particular branch, check other locations and give them options for delivery or pickup. 
  3. If you need to order a part, figure out how long it will take for delivery, and provide options for delivery. 
  4. If the timeline of receiving the product or service doesn’t work for them, suggest other options that could work for them. 
  5. Always tell the customer the next step and provide details of how you can solve their problem.

Stay on top of communication. 

It’s your job to keep customers informed of service updates and order status proactively. If they must call and ask about something to get an update, it’s too late. One of the most important dealer strategies is to anticipate their questions and stay ahead of them. You also need to understand which forms of communication they prefer, and when is the best time to contact them. Communicating with customers on their own terms will make it easier to reach them and shows that you respect their time.

Answer the phone every time. 

Answering the phone is critical for effective customer communication. Your team should be picking up on the third ring or sooner. The reason is that the call drops off rate is 20% per ring after three rings, and customer frustration is exponential for each additional ring and every missed call. Because only 2% to 4% of callers will leave a voicemail, answering the phone is an important first step in understanding what their needs and problems are. If you’re consistently not answering the phone or a customer has several bad phone experiences, they will start to look for another company they can work with for their equipment needs. 

Managing expectations. 

Managing expectations at every point of contact with your customers opens the opportunity to create a raving fan or to lose the customer. One of the most important equipment dealer strategies we can share with you is to always undersell and over deliver. Customers will eventually leave you for the competition if you are consistently falling short of your promised timelines. In fact, the number one reason for losing customers is mismanaged expectations. Be honest with them about when they will receive equipment and parts, when service will be completed, and your rental availability. Honesty and managed expectations will develop trust and strengthen relationships.

Our partner, Zintoro, can help. 

By consistently providing value and outstanding service, you can build long-lasting relationships with your customers and increase their loyalty to your brand. Zintoro provides you with the monthly analyses of your invoices that show your customer retention rate, which customers you’re in danger of losing, customer purchase behavior that will help you anticipate their needs, and much more. They give you the tools and data you need to keep customers, improve communication, and increase your sales. 

Schedule a Zintoro demo to find out how to boost your customer retention, track and accurately forecast business performance, and better communicate with customers. 

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Exceed Revenue Goals

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Exceed Revenue Goals

Guest writers Debbie Frakes and Steve Clegg are back with a new and relevant blog post this week which covers the topic of how to meet and exceed your revenue goals.

Revenue and transaction trends tell a story about your company. They allow you to recognize sales patterns and understand what activities, processes, and methods lead to consistent business growth. Without this information, you won’t be able to make sound decisions for your company. Tracking and acting on revenue analytics and trends will help you answer the following critical questions: 

  • Who should you target for marketing initiatives? 
  • Which products or services should you focus on? 
  • What customers and prospects should your salespeople spend time contacting?

If you don’t determine the right answers to these questions, then you won’t be able to meet your revenue goals, let alone exceed them. 

How to achieve your revenue goals. 

When it comes to drivers of revenue, two of the most important analytics are the number of transactions and customer retention. They explain exactly what is happening in your business and where you may be falling short. These two revenue analytics go hand in hand, because the longer someone works with you, the more transactions they will make. 

Below is an example of a business whose new customers during the past 12 months make up 51% of their total number of customers. The numbers show how the behavior of these customers changes over time, if they keep working with you. 

Average transactions

Year 1: 3

Year 2: 13

Year 3: 18

Average revenue 

Year 1: $39,099 

Year 2: $154,537 

Year 3: $178,789

These revenue analytics show that the longer a customer works with you, the more valuable they become to your company. For this reason, when it comes to meeting and exceeding your revenue goals, retaining customers over the long term should be a primary focus of your sales and marketing teams. 

Act on revenue trend information. 

Tracking revenue analytics is great, but they won’t do you any good if you don’t actually use the information to your advantage. The area where you can make the largest impact towards meeting and exceeding your revenue goals is by improving customer retention and increasing purchase frequency. Remember, for most companies, the longer someone works with you, the more lucrative they become for you. Here are some methods for boosting your company’s customer retention and purchase frequency: 

  • Regular emails – It’s important to consistently communicate with your customers. We recommend sending several emails a month highlighting the products and services you offer, reminding them to purchase, and establishing yourself as the expert in the industry and their go-to source for assistance. Emails sent out by our partner, Winsby, typically double or triple customer purchase frequency. 
  • Offer targeted suggestions – View your customer purchase data to recognize patterns and anticipate what they may need or when they might be getting low on a product. Then you can send them a message or give them a call that is specific to their current needs. 
  • Use customer satisfaction surveys – Regularly ask for feedback from customers about how they feel about your company and how well you are fulfilling their needs. By conducting customer satisfaction surveys, you’ll find out about problems and have the opportunity to solve them before a customer leaves you. Customer satisfaction surveys conducted by Winsby typically boost retention by 20% – 30%. 
  • Calling prospects to expand your email list – Calling provides new leads and introduces customers to your company. Winsby clients see an average increase of 60% in customers’ purchases when they have been called. 

The effectiveness of Winsby email and calling services. 

Customers receiving Winsby emails typically purchase two to three times more often than customers who don’t receive emails. Here is an example the results that an equipment dealer saw with Winsby emails: 

The Winsby calling program identifies decision makers at the companies you’re targeting and then adds them to the email list. Here are the results for a dealer they work with: 

Understand the types of purchases customers are making. 

In addition to looking at customer retention and number of transactions, you also should be tracking types of purchases. Identifying which products sell the greatest quantities will help you focus your marketing and advertising strategies better. Products that are normally purchased more often will deliver a greater ROI for your marketing campaigns than less popular products would.

Once you determine your most frequently bought products, you can then place greater resources behind them and see a higher return. 

Take full advantage of revenue analytics. 

By understanding which customers produce the most value for your business and which types of products and services result in the most transactions, you can better target your sales and marketing efforts. You’ll reach and exceed your revenue goals if you focus on retaining your current customers and push the products that generate the most money. 

Our partner company, Zintoro, will track these key revenue analytics and many others, as well as provide specific strategies for improving them. Their portal shows you exactly which customers should be called when and which products should be promoted. They are the answer for equipment dealers and other businesses who want to make sense of their numbers and use them to their advantage. 

If you want to understand your revenue analytics and use proven strategies to exceed your revenue goals, contact Zintoro today for a demo. Today many businesses rely on outdated data and backward-looking reports for planning. Zintoro generates greater than 95% accuracy in their 12 month forecasts to see the future and plan versus reacting and continually trying to explain the past. 

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How to Measure Sales Performance Unlocking Success: A Guide to Effectively Track and Boost Your Sales Reps’ Performance

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How to Measure Sales Performance – Unlocking Success: A Guide to Effectively Track and Boost Your Sales Reps’ Performance 

Guest writers Debbie Frakes and Steve Clegg return this week in, “How to Measure Sales Performance – Unlocking Success: A Guide to Effectively Track and Boost Your Sales Reps’ Performance.”

In the dynamic world of equipment sales, your sales reps are the driving force behind your success. They not only steer potential leads to becoming valued customers but also play a pivotal role in nurturing existing client relationships. Without a high performing sales team, your business risks stagnation and having customers leave for competitors.

It is essential to employ robust strategies for tracking and improving the sales performance of your representatives. This blog will guide you through the process, emphasizing the significance of regular performance analysis and introducing the effectiveness of Zintoro.com to guide actions that result in improving sales.

Complete a Sales Performance Analysis

To ensure your sales reps consistently meet their goals, conducting a comprehensive sales performance analysis is imperative. This involves tracking key metrics such as:

  • Conversion Rates—Measure how effectively leads are turning into customers.
  • Appointment Setting Rates—Evaluate the efficiency of securing meetings with potential clients and existing customers to capture more of their transaction.
  • Customer Retention Rates—Assess how well your reps are maintaining relationships with existing customers and building these relationships by expanding the products and service purchased.
  • Customer Purchase Frequency and Consistency—Understand the frequency at which customers make purchases and the impact of weekly and monthly purchases.
  • Overall Revenue and Gross Margin—Gauge the contribution of each rep to the company’s revenue and profits.

Setting realistic goals for these metrics is an important part of this process. With regular analysis you can track progress and identify areas for improvement. Zintoro forecasts expected sales with a >95% accuracy which provides realistic expectations for branches and sales territories. 

Why it Matters for Your Dealership

Sales rep tracking is not just about metrics; it’s about the success and sustainability of your dealership. By regularly monitoring performance, focusing on customers that are at risk of being lost, managers can quickly identify underperforming reps and take corrective actions. Recognizing critical Zintoro sales metrics helps in setting benchmarks for the team, providing insights into individual achievements or shortcomings.

Without tracking sales performance and customer engagement, you risk being in the dark about your team’s accomplishments or any underlying issues. Early detection of performance problems allows for timely corrections, action plans, and issue resolution, preventing customer loss.

Implement a Zintoro Sales Performance Analysis

Enter Zintoro.com — your comprehensive solution for an exact understanding of how well your reps are meeting their goals. With Zintoro’s sales performance analysis, you can:

  • Identify Shortcomings—Recognize areas where reps are falling short and gain insights into the root causes.
  • Comparison Insights—Let your sales reps compare their performance with others, fostering healthy competition and motivation.
  • Strategic Actions—Zintoro not only provides insights but suggests actionable steps to enhance customer engagement, retention, and overall growth.

Zintoro’s suggested actions pinpoint precisely what needs to be done to elevate sales performance with real growth both in upturns and industry downturns. If you’re ready to embark on a journey of tracking and improving sales performance, or if you have questions about the most important sales metrics, contact Zintoro today.

Unlock the potential of your sales team with Zintoro.com — where insights meet action for unparalleled growth.

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Why Your Geographic Market Matters

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Why Your Geographic Market Matters

Guest writers Debbie Frakes and Steve Clegg write about why your geographic market matters, and how this concept directly impacts your business.

Why Geographic Market Matters for Your Business

When it comes to whether someone will work with a company or not, there are a wide variety of factors that come into play. Many of those factors are things you can control, like your parts availability, quality of customer service, and how effective your technicians are. But there are some other factors that are not in your control. For equipment dealers, one of those is your geographic market. 

What is an equipment dealer’s geographic market? 

Distance for geographic market is one of the most important business metrics for your dealership. It measures the number of miles and travel time that a customer will travel in order to work with you or buy products from you. The geographic market for a business can vary, based on the industry, market, or region that a company is located in. But if distance is a factor for your business, like it is for equipment dealers, then a customer is very unlikely to do business with you if you’re beyond that distance. 

In order to learn what the distance for geographic market is for your dealership, you must understand where your current customers are coming from. After knowing how far away from you most of your customers are, you’ll be able to recognize patterns, see if there are any outliers, and know how important a factor distance is for building your customer base. 

Why distance for geographic market matters for you

If a prospect is beyond the maximum range people are willing to travel to work with you, then it will be extremely difficult, if not impossible, to turn them into a customer. In general, most equipment dealers have a maximum service area within a 60-mile radius. The reason for this limit is that with a greater distance than that, it’s too difficult for your field service trucks to respond quickly enough to an emergency service situation. 

Geographic market is one of the most important business metrics for you to pay attention to, because if a customer is beyond that 60-mile range, you don’t want to expend any resources going after them. You should use this metric to focus your marketing and sales strategy on targeting people who are within your maximum distance and, therefore, more likely to work with you. 

How to use geographic market to your advantage 

Although you can’t control how far your dealership is from any given customer, you can use knowledge of geographic market, like other business metrics, to make your marketing and sales efforts more effective. You should only be targeting prospects within your dealer’s range, because they have a much greater potential for your business. 

Over the long term, this type of geographic targeting will save your dealership money, help you tailor your marketing and sales messaging, and allow you to become highly skilled at serving customers in your specific area. All these activities are conducive to your long-term growth and success. 

If you want to understand your dealership’s geographic market and other key business metrics for your operation, then we recommend conducting a market analysis through our partner, Zintoro. It will determine how large your potential market is and exactly what the distance is for your maximum reach. This analysis will help guide your business strategy and keep you from wasting resources.

Schedule a Zintoro market analysis today. 

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How to Improve Customer Retention

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How to Improve Customer Retention

Guest writers Debbie Frakes and Stephen Clegg analyze the key measure of business success in this week’s blog post, “How to Improve Customer Retention.”

Customer retention is crucial for the success of every company. It describes the percentage of customers who purchased within the last 12 months who also purchased within the prior 12 months—13 to 24 months ago. Poor customer retention means that you aren’t keeping customers over the long term and people are not committed to working with you. The result is that you must devote resources continually toward acquiring new customers, taking up valuable time and money. 

Maintaining strong customer retention is important for two primary reasons. The first is that it’s significantly more expensive to sell to a new customer than to an existing one. The second is that the longer a customer works with you, the more they buy from you and the more valuable they become to you. 

The question is, how can you improve your customer retention? 

Understand why customers leave you. 

The primary reasons that customer will leave you are these:

  • You’re mismanaging their expectations and not keeping them informed on the status of their orders. 
  • There is a change in contacts for either the customer or for you. 
  • Your employees aren’t adequately trained or knowledgeable about your products and services or they lack the information system support and tools required to be responsive.

Despite what you may think, price is not at the top of the list when it comes to reasons that customers leave your company to purchase from a competitor. Once you understand why people may stop working with you, you can take steps to prevent them from leaving to buy from competitors. 

How Zintoro helps you retain more customers. 

Zintoro provides the data and insights to recognize at risk customers, while our partner Winsby gives you the tools to significantly improve your customer retention. 

Offer great customer service – In order to deliver top notch customer service, you must understand expectations and be responsive to questions and concerns. Zintoro uses Winsby Inc.’s customer satisfaction and benchmark survey programs to find out what your customers’ expectations are and to determine if there are any issues they are having. Your team can then act on this information and keep at risk customers from leaving you. 

Provide a personalized customer experience – Our AI system tracks each of your customers to identify their next purchase, what industry, and market they are in, and whether they are at risk of being lost. Armed with that information, your sales team can personalize customer interactions and tailor offers and recommendations to meet their specific needs. Our partner Winsby will keep your master lists up to date with the correct contacts, phone numbers, and email addresses. 

Develop strong relationships through consistent communication – Zintoro helps you contact and communicate with customers in several ways. First, you can use purchase history data to identify people who have not purchased in their usual time period, then reach out to ask about their needs. Second, you can distribute highly effective emails through Winsby. Customers who receive Winsby emails typically purchase two to three times more often than those who don’t. Third, Zintoro works with most CRM systems to integrate analytics data with your sales and marketing data, helping streamline customer communication. 

Use customer feedback to take action – Implementing Winsby’s customer satisfaction surveys is a great first step, but you must actually act on the information and feedback you receive. Utilize the insights from the surveys to improve your sales process, products, and other aspects of your business before at-risk customers leave you. 

Recognize the signs of at-risk customers – Zintoro tracks the frequency, consistency, and types of purchases, so you can know who your at-risk customers are. Your sales team can then use that information and reach out to those customers, ask about their needs, and even provide a special offer or other incentive to encourage them to stay with you.

Take steps now to improve your customer retention. 

Increasing your retention rate is an ongoing process that should be started as soon as possible. Building lasting relationships with customers is crucial for the long-term viability of your company because it makes them more valuable to you and it takes fewer resources to sell to them. Zintoro gives you the information and tools required to retain customers and boost your sales. 

Schedule a Zintoro demo to find out how to boost your customer retention, track, and accurately forecast business performance, and to determine the ROI for your marketing and customer satisfaction efforts.

 

Types of Purchases: Understand What Your Customers Are Buying

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Types of Purchases: Understand What Your Customers Are Buying

Guest writers Debbie Frakes and Steve Clegg take a look at customer behavior in this week’s blog post, “Types of Purchases: Understand What Your Customers Are Buying.”

To market your business effectively, it’s important to understand which products and services your customers buy most often and what causes someone to purchase from you. By identifying common buying patterns and the factors that influence purchase decisions, equipment dealers can tailor their strategies to appeal to their target industries and markets. The result is more transactions, improved customer retention, and increased profits.

Why do the types of purchases matter? 

By identifying what triggers a purchase for equipment, rentals, service, or parts, and what is bought most often in each category, you’ll determine what is important to your customer base. Armed with that information, you will know which strategies and messaging for offers, pricing, marketing, and advertising will produce the most significant ROI for your business. Excellent customer service with frequent and consistent customer transactions drive customer retention. Revenue and profits are the result, not the driver.

Understanding what customers purchase most often and why allows you to avoid wasting time and resources featuring products and services with nominal engagement and ROI. 

Capture more sales opportunities. 

The local NAPA, Grainger, and other general supply houses are selling the filters, fluids, and parts to your customers that are required for your equipment. Grainger and Genuine NAPA have an average gross margin above 40%. Most types of equipment require two to six filter changes a year as well as numerous fluid changes. The question is, are you capturing those sales opportunities, or are you allowing someone else to take the order? Recognizing types of purchases will increase transactions, help you engage and retain customers and capitalize on the needs of your customer base. 

Know your trigger products. 

Triggers are items or situations that drive customers to a store or dealer. For example, grocery store trigger products are milk, eggs, and bread, because these items are the reason someone goes to the store in the first place. However, these products represent less than 10% of the dollars spent. They serve to get people in the door, so they can be sold other products sold in the store. 

Examples of equipment dealer triggers for machines, rentals, parts, and service:

  • Emergency machine repairs can trigger equipment purchases when the repair cost doesn’t justify the expense versus renting or replacing the machine.
  • Machine breakdowns or a specific type of project will trigger renting equipment that is not in the customer’s fleet. 
  • Breakdowns or equipment crises will trigger repair or maintenance parts. 
  • Offering a free inspection or a season change can trigger service. 

Crises maintenance represents over 25% of a dealer’s customer interactions for parts, service, and rentals. These transactions require same day or next day service and delivery to meet customer expectations. Equipment represents only 1% to 2% of a dealer’s total transactions, whereas parts and services are 88% and rental is 10%. As a result, your parts and service departments create your customer experience and are ultimately responsible for overall customer satisfaction and retention.

Understanding what purchases bring customers through the door tells you where your main focus should be. 

 Place your resources where they make the most difference. 

Every business only has a limited number of sales, marketing, and financial resources they can utilize at any time. The reason why types of purchases is one of the most critical business metrics is that it will show you which products and services to run promos on, which ones to highlight in your emails and on your website, and what to run paid advertising on. In addition, it will determine pricing offers and your inventory requirements. 

You need to know what people are buying and what triggers those purchases. Businesses should carefully consider their target audience and tailor their marketing strategies to appeal to triggers that resonate with specific types of customers. 

Knowing types of purchases helps you introduce people to additional products. 

Armed with the knowledge of which types of purchases are most common, you can familiarize customers with what you offer. They will come to your website or view your email based on the products they typically buy or because of a specific trigger, but then they’ll see other things that you carry. Use your most popular offerings as a hook to get them in the door, where they can see everything that your dealership provides. 

Zintoro provides equipment dealers and other businesses with monthly business analytics reporting to recognize, measure, and take advantage of key business metrics like purchases, purchase frequency, customer retention, at-risk customers, and more. 

Schedule a Zintoro demo to understand your most common types of purchases and start receiving business analytics reporting today! 

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How To Improve Customer Retention

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How To Improve Customer Retention

This week, guest writers Steve Clegg and Debbie Frakes talk with readers about how to improve customer retention. This is one of the best ways to build successes: keep the customers you already have!

Retention is critical for the long-term success of any business. It’s crucial because it is far less expensive to keep your existing customers than to acquire new ones, and customers will buy more products and purchase more often from you the longer they work with you. Zintoro business analytics will tell you what your overall retention rate is and if you are in danger of losing specific at-risk customers. Armed with that information, you can take the right steps to ensure they keep working with you. 

Why customers leave you. 

Customers will stop working with you for any number of different reasons. But the primary cause is mismanaging their expectations and not keeping them proactively informed of good and bad news. The second most common reason that a customer leaves a business is a change in the employee contact or the customer contact. The third cause is having employees that are not adequately trained or knowledgeable of your products and services. Despite popular belief, price is not typically the thing that drives customers away. In fact, on the list of most common reasons, price is usually fifth or sixth. 

There are several strategies you can implement to retain more customers over the long term. In this article, we’ll look at what they are and how Zintoro helps you put them into practice.

Retain more customers with Zintoro and their partners. 

Offer exceptional customers service. 

The key to providing excellent service is understanding customer expectations and being responsive to their questions and concerns. Your team should be proactive and reach out to customers before they contact you in order to answer the questions you anticipate them asking. 

Zintoro uses Winsby Inc.’s customer satisfaction and benchmark survey programs to determine your customers’ expectations and any issues they are having. Your team can then act on this information. For employee customer service training, Zintoro relies on Ron Slee’s Learning without Scars’ online and in person training programs.

Personalize the customer experience. 

Zintoro AI tracks each customer to determine their next purchase, what industry, and market they are in, and whether they are at risk of being lost. Using that information, your sales team can personalize customer interactions and tailor offers and recommend services to meet their needs, based on their past purchases and preferences. Zintoro also works with Winsby Inc. to keep your master lists up to date with the correct contacts, phone numbers, and email addresses, as well as to segment your lists and tailor messaging to specific groups. 

Build strong relationships with consistent communication. 

Improving customer retention depends on engaging with your customers and supporting them beyond the point of sale. Zintoro can help in several different ways: 

  • Provide the customer purchase data you need to reward long term customers with discounts, exclusive offers, or special access. 
  • Create and distribute high engagement emails, blogs, newsletters, and social media content through our partner, Winsby Inc. 
  • Zintoro works with most CRM systems to integrate analytics data with your sales and marketing messaging. They have found that Constant Contact’s Sharpspring CRM program supported by ClearTail marketing is one of the best because it is easy to use, automates much of the sales and email process, tracks customized information to help the customer experience and sends scored sales leads to your sales team. 

Collect and act on feedback!

The key to understanding your customer expectations and issues is to regularly ask for feedback. Implementing customer satisfaction surveys from our partner, Winsby Inc., provides insights into how customers feel about your company and how well you provide for their needs. You’ll discover issues with your sales process, products, and other aspects of your business before they turn into major problems and customers leave you for the competition. 

Know the signs that a customer may leave. 

Zintoro tracks the products, frequency, and consistency of customer purchases to identify who is at risk. Your sales team can then act on that information and reach out to those customers, ask about their needs, and even provide a special offer or other incentive to encourage them to stay with you. 

Highlight social proof and testimonials. 

Showcasing positive customer experiences in your emails and on your website helps you convert more prospects and keep your existing customers. Zintoro AI tracks the online customer satisfaction scores, and Winsby Inc. posts your verified customer reviews online and on your website.

Zintoro is the key piece of the puzzle for customer retention. 

Increasing retention is an ongoing process. By consistently providing value, personalization, and outstanding service, you can build long lasting relationships with your customers and increase their loyalty to your brand. Zintoro provides the data and information you need to understand your customers, and our partners give you the tools required to retain them and grow your sales. 

Schedule a Zintoro demo to find out how they boost your customer retention, track, and accurately forecast business performance, and determine the ROI for your marketing and customer satisfaction efforts.

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How to Avoid Losing At-Risk Customers

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How to Avoid Losing At-Risk Customers

Guest writer Debbie Frakes returns with practical, step-by-step guidance in “How to Avoid Losing At-Risk Customers.”

How to Avoid Losing at Risk Customers: Recognize the Warning Signs

At-risk customers are the ones that you are in danger of losing to the competition. These are current customers who start purchasing less and less from you and eventually go somewhere else to get what they need. Preventing at-risk customers from leaving you requires two steps: first, you must identify who they are, and second, you must fix whatever is driving them away. In this article, we’ll cover how to do both.

  • Understand the key metrics for your business.

The only way to identify who your at-risk customers are is to look at the key metrics. In particular, you want to look at their purchase frequency. If the interval between purchases is longer than usual for a specific customer, it may indicate that they are beginning to work with a competitor instead of you. 

If you recognize that a customer’s purchase frequency is consistently decreasing, then you want your sales team to contact them. Most people will not tell you if your company is not meeting their needs. They will just leave you after a certain amount of time. Knowing their purchasing behavior will give you important insights into what they are feeling and how things are going. 

Monitoring key metrics like purchase frequency is critical for preventing the loss of customers who are at risk. 

  • Customer satisfaction surveys are critical. 

Once you understand which customers are thinking of leaving, you can take the necessary action to keep them working with your company. The best way to boost customer retention and ensure people stay with you is by conducting customer satisfaction surveys. They help you recognize any issues that people are having with your company before they turn into bigger problems. If you catch the issue early and fix it, then you are showing at risk customers that you care about them, and the odds are that they will stay with you.

Retaining customers is important, because acquiring new ones can cost up to five times more than working with current ones. Immediate profits and long-term growth depend on avoiding the loss of at-risk customers. 

  • Listen to what your customers have to say. 

Once you find out who your at-risk customers are and determine what the issues are that are driving them away, you need to act on that information. When you receive feedback from an unsatisfied customer, you’ll have the chance to contact them and make things right by addressing their concerns. Nothing tells customers you care like giving them your time and attention.

If you actually listen to what your at-risk customers are saying and take the time and effort to fix what they tell you is wrong, then they typically will no longer be at risk. In fact, these formerly at-risk customers tend to become your most loyal and dependable customers going forward. 

If you want to know who your at-risk customers are by reviewing your key metrics, so you can prevent them from leaving, you need to begin conducting customer satisfaction surveys. Contact our partner, Winsby Inc. They will conduct effective surveys on your behalf and arm you with the information you need to retain more customers. 

Contact Winsby Today

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What Purchase Frequency Means for Equipment Dealers

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What Purchase Frequency Means for Equipment Dealers

Guest writer Debbie Frakes writes about metrics today with her blog post, “What Purchase Frequency Means for Equipment Dealers.”

Purchase frequency is a crucial key metric for equipment dealers to consider when evaluating the behavior of their current customers and their marketing efforts. It refers to the number of times a customer buys products or services from a company within a specified time. Analyzing purchase frequency will help you recognize at risk customers, because it tells you when they start going to competitors instead of you. 

 

Know if customers are buying from competitors! 

 

Purchase frequency gives you insight into what your customers are up to. Construction, demolition, utility, and other businesses that use heavy equipment require a consistent supply of parts, service, and machines. That means that if they aren’t buying those things from you, they are going somewhere else. So, if their purchase frequency is decreasing, it could indicate that they are turning to one of your competitors. 

 

Learn your customers’ purchase behavior! 

 

Tracking the purchase frequencies of your customers will give you a baseline for their typical behavior, including when and how much they usually buy. Armed with that information, you can then modify your marketing messaging, timing, channels, and overall efforts to fit your customers’ usual purchasing habits and trends, making it easier for them to buy what they need from you. 

 

Improve specific areas of your business! 

 

As an equipment dealer, you really have multiple different businesses connected and rolled into one. To be successful, each of those different businesses need to be firing on all cylinders and operating at peak performance. If your parts department and equipment rentals are strong, but service purchase frequency is decreasing, then you must take a closer look at that section of the company and implement steps to improve it. 

 

How to increase purchase frequency: Distribute Emails

 

The best way to increase your purchase frequency is through email distribution. When you consistently send out effective messaging, you can double or triple the number of times that your customers buy from you. Email distribution can deliver an incredible return on investment of over 4,000%. 

 

Emails are effective, because they inform people about everything you offer—products, services, parts, rentals, advice you can offer for better equipment performance. They also keep your company top of mind and serve as reminders to purchase again, stock up on parts, or schedule an inspection. 

 

Ensure your emails are effective! 

 

You can only achieve higher purchase frequency if your email distribution is done the right way. Emails must be designed and written professionally, must compel the reader to act, and they require a CTA that links back to your website or landing page. More than anything else, you want to encourage your recipients to buy from you or schedule a demo, and then make it easy for them to actually do it. 

 

Email distribution also allows your salespeople to identify which customers or prospects are engaged by seeing who opens and clicks on the emails. If they follow up with those who are consistently viewing your messages, then they can possibly move them to purchase again. Plus, sending out specific messaging to customers whose purchase frequency is decreasing may just be the push they need to come back to you. 

 

If you want to understand your purchase frequency and increase it through email distribution, then contact Winsby Inc. today. They will help you get started creating and sending effective messaging quickly. 

 

Contact Winsby Today: https://www.winsbyinc.com/contact-us.html

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Upturn or Recession?

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Upturn or Recession?

Guest writers Steve Clegg and Debbie Frakes are writing for us this week about the ways in which our accurate forecasts can help us plan for real growth in “Upturn or Recession?”

The equipment industry is cyclical and seasonal. Many dealerships react to events by looking backward at accounting financial statements, explaining why they are victims of current market conditions. But the most successful dealerships always look forward by forecasting and planning for the future. As a result, they can take advantage of both upturns and downturns.

There are effective Artificial Intelligence (AI) models that can be used to forecast and create a business plan, based on these forecasts. During an upturn, you can expect shortages of parts, equipment, and employees, as we have recently experienced. The best approach to maximizing profits is to focus on the customers and industries with the highest retention rates where the best service can be provided to generate a healthy gross margin and a high return on capital. This process builds cash and liquidity and strengthens the balance sheet in anticipation of opportunities during a downturn.

It is important not to chase the upturn, although OEMs and banks are often eager to encourage that approach to accelerate their own growth. A sustainable growth rate for your own facilities, employees, balance sheet, and customer retention, however, places limits on rapid growth. Most dealers cannot sustain a growth rate in customers and transactions greater than 10% to 15% per year, regardless of the opportunities. The requirements for new customers, employees, systems, facilities, training, and capital are beyond their internal capacity to grow and keep their existing customers happy. Using AI Analytics, you can see forecasts with >95% accuracy for the next 12 months for your business, by branch and department, providing the number of customers, transactions, and revenue that can be expected. With AI forecasts you can anticipate exactly what to expect for your customer retention, customer engagement, and even ROI on your sales and marketing programs. This approach allows better accuracy in planning the future and anticipating the best ways to identify opportunities.

During a downturn, successful dealers forecast, then use their strong balance sheets and cash flow to purchase parts and equipment at steep discounts from their suppliers and competition. They also hire the best employees, pick up additional equipment lines and territories, and acquire assets from competitors that have failed. With this approach they create the foundation for real growth during the next upturn. A 1% improvement in customer retention usually generates a 12% annual transaction growth rate. There is less vulnerability to economic downturns when customer retention is strong. Historically, there is only a 7% to 15% reduction in transactions over a 12-18 month period during a downturn, so the improved retention easily offsets this reduction. 

There are five steps management you can take now to ensure your company can weather any type of economic cycle. 

  • Create a forecast the next 12 months, based on your current performance, and continue to forecast by updating your results with the prior month’s revenue. With this approach your organization will have a clear picture of what will happen for the next 12 months, if you continue to operate as you have been. 

A platform that is easy to use to produce accurate forecasts is Zintoro.com. Its AI Analytics program provides automated forecasts for customers and transactions, including the resulting gross margin and revenue, by company, branch, and department with a >95% confidence level.

  •  Use the 12-month forecast to create a plan that will maximize revenue and profits

Actions for improvements are steps that you plan to begin during the next 12 months to assure you will meet or exceed the forecast, which is your benchmark. 

An action plan for an upturn provides the steps to take to overcome hurdles that are typical during an upturn, such as available working capital, delayed parts and equipment deliveries, dissatisfied customers, increased costs, and accommodating increased order frequency for parts and service with a backup plan to prevent overwhelming your employees and facilities. 

An action plan for a downturn provides the steps necessary to take advantage of the next downturn. 

  • Identify the customers that are not profitable and take steps to reduce interactions with them.
  • Determine opportunities to automate wherever possible, from equipment and customer communications to operating systems. 
  • Build cash and set up processes to generate a high return on capital employed.

A recession presents a set of severe financial hurdles that typically include: reduction in available capital, delayed customer payments, drop in equipment sales, decrease in rental utilization, and reduced frequency for parts and service orders. 

Rank the ways to cut costs, using the improvement of employee support for your customers as the primary driver. This ranking should answer these questions: 

  • What is essential to keep the doors open and assure that stable customers are engaged? 
  • Where to invest to acquire and retain stable customers, by market and industry?
  • Where to invest to hire and retain the best employees?
  • Where to invest in equipment, technology, and facilities at favorable prices?
  • How to keep all other costs as lean as possible? 
  • Where to automate and outsource? 

 Keep shareholders, lenders, suppliers, and employees informed.

Zintoro.com provides reports for actual results and forecasts to manage expectations and keep these groups focused on the key drivers for customer retention, customer engagement, and opportunities for improvement. Revenues and profits result from customer retention and engagement.  

  • Maximize cash and profits.

Implement the following actions quickly to maximize cash on hand and focus on generating additional cash to build and maintain your cash cushion. 

  • Monitor the cash flow weekly with a system to show actual receipts and disbursements tracked at least weekly and continually update the cash forecast for 12 months to anticipates any problem periods.

Obtain debt at favorable fixed rates and establish credit lines to ensure cash availability with reasonable lender covenants. Be aware of their liquidity options. Businesses that line up capital sources before they need funding often receive more favorable terms. Funding sources may include revolving credit lines, owner infusions, alternative financing, and private equity. 

In a downturn, revenue and cash availability always fall faster than expenses. Sources of capital dry up and as inflation accelerates, costs climb faster than you can raise prices, reducing your available cash.   

  • Put together a list of expenses you can reduce to minimize your cash burn rate and identify sources of additional cash and when they may be required. The longest recession in the past fifty years was 18 months; most recessions last less than 12 months. Your goal is to have enough cash, including capital reserves, available to make up the difference between the potential gap in cash flow, so that you can maintain operations for twelve to eighteen months and take advantage of the opportunities that will be presented during such times to build your business. 
  • Manage your supply chain proactively by keeping your suppliers informed with your forecasts and requirements. Anticipate how your customers and suppliers will react when you are projecting your cash requirements. 

In a recession, understanding the financial situation of your customers and suppliers is critical. It’s important to be realistic, not optimistic. Assess customers to identify which ones might slow down their payments or become unable to pay. These customers can double your working capital requirement during a downturn. Meet with your key customers and suppliers to review your forecasts and anticipate their problems by understanding their challenges, too. Negotiate payment plans with suppliers while offering incentives to customers for early payments or bulk orders. 

  1. Evaluate your parts and equipment inventory to reduce capital employed       and increase turns.
  2. Develop a program for recruiting and training employees. Plus, expand ways to retain your employees proactively. 
  3. Track all sales and marketing programs with a return on investment. Cut programs that are not generating a return that you can document.
  4. Forecast and plan, don’t wait and react. Without planning you are put in a position of reacting by quickly cutting spending, firing employees, and putting your equipment inventory and assets out for auction at steep discounts. Reacting rather than plan can destroy your ability to recover during upturn that will follow at some point. 
  5. Track and invest in marketing programs with the highest ROI. Compare spend for customers who were exposed to a marketing activity versus those who were not. For example, if you have an email program in place to alert your customers of specials and services you offer, compare the spend for customers with an email to those who aren’t receiving your emails. Are you calling customers regularly? Compare the spend to those you’re calling to those you haven’t called. What about contacting customer for follow-up surveys? Are the ones you talk to spending more than the ones you haven’t contacted? Below are some comparisons for a dealer over a 12-month period, as an example.

 

Marketing Transactions Revenue Cost ROI times
Program /Customer /Customer /Customer Active Customers
Telephone
    Called         24 $128,440 $28 1231X
    Not called     37 $93,965 $0     – 
Emails
  Emailed               30 $134,270 $35 2378X
  No email                 4 $51,0443 $0     –
Surveys
  Surveyed               16 $82,423 $35 966X
  No survey                 7 $48,616 $0     –

 

Next Steps

Zintoro.com has developed a forecasting program that is updated monthly with your results. Just download the last two years of your invoices, plus invoices from the current year to date, and send them to Zintoro to upload into their password protected portal. They will schedule a call to review where the forecast shows you are headed and what steps you can take to change those numbers. Contact Steve Clegg at csclegg@zintoro.com for additional information.

To get started with marketing programs that you can count on to increase sales and deliver an impressive ROI, contact Debbie Frakes at dfrakes@winsbyinc.com. 

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