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December 2017
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Mike Rowe asked the question!

Probably not too many of you in the world of equipment dealers spend much time viewing television and paying attention to commercials. But, may we point out one commercial that some of you will find of value to watch. Ford Automobile recently hired Mike Rowe. You should all remember him. He was the man who did all those “dirty jobs” on TV.

In these advertisements, Mike is, of course, selling the Ford line of cars and also very subtly hyping the services the dealership performs to keep the customer happy: The commercial that caught my eye was Mike and a customer having a conversation in the dealers’ showroom. The customer evidently had her car in for service and was browsing the showroom when Mike stopped her and asked why she had brought her Ford into the Ford dealer for service when she had obvious other options for getting it serviced, and for a better price. To which the customer replied, “I bring it here because I bought it here and these people truly care about me and want to take care of me, and because we are family!” Those of you in the equipment business may want to substitute “partner” for “family.”

Dealers ask yourself this question: How many of you have 30% of your customers who feel that way about your dealership and in particular your own service department? Anything less than that has to be what I would say, insulting to your dealership.

You may know the answer to this question, but what are you doing about it? As we have expressed hundreds of times, your service department is overflowing with unrecognized opportunity! It is almost like dealers don’t want to be bothered with a shop filled with business or with road service vans driving all over the territory servicing the equipment that your dealership worked so hard to sell.

As we have mentioned to equipment dealers so many times in the past 35 years, your customers have a CHOICE! They do not need you to provide them parts or perform service on the equipment they purchased from your dealership. Some of your customers are: 1) working on their own equipment, in their own shops, with their own technicians; others are 2) taking their work to those profitable independents that have grown dramatically over the past few years; still others 3) are taking their service requirements to other OEMs or to 4) those “shade-tree” technicians. The reasoning behind this as explained in so many industry surveys is that equipment dealers fail to market the quality of their service to the customer before, during or after the equipment has been sold. In too many equipment dealerships, service is probably the last thing a salesperson wants to talk about with a prospective customer or a customer who has just bought your equipment.

Several weeks ago at Promat, the Material Handling Show held in Chicago, a friend and I were talking. His name, Garry Bartecki, is well-known throughout the equipment industry. Garry asked me whether or not I would like to go to China for a year to train the Chinese in the techniques of marketing service, because his findings were that the Chinese know absolutely nothing about marketing service. I basically replied to Garry that I’ve been all over the world except for China, but at my age why would I want to go to China now? Last, but not least, I mentioned that after all these years of trying to do the same thing throughout North America, why would I want to try it in China?

Several years ago I made a presentation to a large group of industrial/construction/equipment dealers. During this program I made a suggestion that really “shook-up” the group. I told them that if they believed it was too much of a problem to grow their service business, if it was too much of a problem to find qualified technicians, if it was too much of a problem to expand their operation to handle this profitable segment of their business, if it was too much of a problem to put up with upset customers, and finally if everything about the service department was a pain in the butt; then why not sell-off that segment of unknown opportunity?

I suggested that all they would have to do would be to approach the local, successful independent with a proposal that they take over their total service business, “lock, stock and barrel” for an agreed upon price. I told these dealers to make arrangements when the dealership sells a piece of equipment to introduce that customer to the independent, and the independent would be fully responsible for handling the needs and requirements of that new customer. I suggested to the dealers that they could work up a financial arrangement with the independent. An arrangement whereby the independent could pay the dealer a fee based upon the amount of business he was doing with your “former” customers. Today, this sounds like a pretty good deal to me . . . and quite frankly I am aware that quite a few dealers have actually done this, and others have given it some thought. What the dealer’s major suppliers think about this is any body’s guess. But looking at it in another way, if the independent is doing an exceptional job of satisfying the dealer’s customer . . . then there are winners, all around!

Consider this all my dealer friends out there. If you are not interested in truly promoting your service abilities to your customers, if you are unwilling to appreciate that your service department is, in some cases your last remaining area of reasonable profitability, if you are unwilling to devote the time, the monies, the personnel, the real-estate to this lucrative area of your business, then your present business will shrivel and die as someone takes it over by competing or buying your business or just continues to service your customers.

I am and have always been a positive-thinking individual. I am a believer in the equipment industry and in the method of how manufacturers take their product to market. I am pleased to know and have worked with many, many dealers who are operating successful dealerships with exceptionally strong product support of their major lines. I am only weary of dealers who sit around and complain that today there is no way they can make money in their dealerships, the profits just aren’t there any longer, they sit there complaining, but fail to take the time to look at the unknown opportunity to be found in the back end of their businesses.

To reap the benefits of these unknown opportunities, dealers are going to find it necessary to change the culture of their business. Basically they are going to have to communicate to the prospective customer, the customer who has just purchased equipment from the dealership and those customers who own your equipment, but are servicing it themselves or having a competitor perform their service. For some this will be a simple change, for others it will be more difficult. You will be asking the customer for his service business up front, maybe with the words: “We want to earn your service business. We want to prove to you that our quality service department is willing to work hard for you to solve any problem you may have experienced in the past with unscheduled down time with your equipment.”

It will be necessary for you to focus, to focus upon marketing your service department with the exact same dedication that you put forth in marketing of whole goods! The dealership will have to make an investment in people, facilities and time. We can show you that this investment will immediately, and in the long-run, provide your dealership with the highest return on the investment that you could possibly find within any other dealership profit center.

One well-known manufacturer and its complete dealer organization has recognized this unknown opportunity for decades. This has helped both the manufacturer and the manufacturer’s dealer organization weather every imaginable difficulty that has been thrown at them. The entire operation, along with its dealers, will continue to survive, prosper and grow in the future. Your dealership could too, if you would just remove the blinders and move forward.  “If you believe you can, then you will, if you believe you can’t, then you probably won’t!” Henry Ford

John R. Walker is president of After Market Services Consulting Co. Inc. E-mail to contact John.