Two Unique Strategies for Increasing Sales

In this economy dealers are scrambling for ways to increase sales so they don’t have to close their doors. Here are two strategies for doing just that!

Strategy 1: Turn Employees into Owners

It’s the question every dealer wants an answer to: “How can I get my employees to do what I want them to do, and keep them motivated to work hard?”

Unfortunately, we’re all out of magic wands. But the good news is, there’s another solution!

That solution is this: you’ve got to get your team thinking like an owner. If you treat them like an employee then they’ll act like an employee. After all, the harder they work the richer you get. So where’s their motivation?

You need to get them involved in the success of the business so that they’re rewarded when the business does well. This creates a sense of ownership.

To do this, you need to create a performance based incentive program that includes not only your sales and service departments, but also the rest of your office staff so all employees are involved.

If you want to really set up a successful performance based incentive program then it’s important to pay out to your team at least once a month, if not every two weeks. This will keep them excited, and remind them that rewards really do come if they work hard to better the dealership.

Many dealers only pay out at the end of the year, but this is a mistake. Paying out once per year won’t get your team excited, because the reward is too far off, too remote.

So, how will performance incentives help make money for your shop?

Well, if your team knows they’re going to get a financial reward for a set goal, like higher efficiency or increased sales, and they know they’re going to get that reward in two weeks, then they’re going to work extremely hard to hit that goal. This means that your dealership will have lower costs and/or increased sales because of their efforts.

When they profit because of the dealership’s success, then they’re going to feel just like you. They’re going to feel like an owner, and it won’t be just a “job” to them.

Having reliable outdoor power equipment office management software is the best way to keep track of the metrics that measure your employees’ performance. These metrics could be efficiency, weekly sales, or even lowest number of customer complaints. Tracking how well your team is performing is the best way to ensure you’re paying them the correct bonus.

Strategy 2: Increase Your Sales with Family Events

One of the easiest ways you can help increase sales in your dealership is by holding events geared toward your customers and their families. Family events work best in dealerships whose customer base is 70% consumer and 30% is commercial.

You could plan an event like “family fun days”. This is essentially a party you’re throwing for your customers, and their kids. Incorporate balloons, scavenger hunts (you can do these indoors in winter!), games, demonstrations…use your imagination!

Holding a family event on Saturdays is a great way to get people into your store. And compared to what you might spend on ads or commercials, it’s an incredibly cheap way to market to your customers.

Bring out your grill and have some of your employees cook hot dogs and hamburgers. Have plenty of soda and water on hand, and some brownies for dessert. You could also rent an inflatable bouncing tent for the kids (which would leave their parents free to shop!)

It would also be smart to run a special “family sale” just for the event.

Family events are great for building rapport with customers and making them see that your dealership is truly part of the community. And in this shaky economic climate, that’s a marketing strategy that’s just going to pay off.

How to Compete with the Big Box Stores

Unless you’re in a remote rural area, then your dealership is probably competing with a big box store like Lowe’s or Home Depot. The stores are everywhere and many dealers are wondering, especially in this recession, how they can compete with these discounting giants and still stay in business.

Well, the bad news is that you probably can’t compete with the big box stores, at least on price. They simply buy too much compared to smaller dealerships.

The good news is that you can leverage their traffic to get more sales.

How?

Well, one way is to change your hours. Many dealerships close at noon on Saturdays, and might close entirely on Sundays. But, many customers go out shopping late on Saturdays and on Sundays, because that’s the only free time they have to go. So can you blame them for buying from a big box store? After all, you were closed.

So, make sure you’re open to receive your customers when they’re ready to buy.

It’s also important to realize that, due to so much uncertainty with jobs and the economy, many people are feeling very skittish. They’re seeking the comfort of trusted relationships far more than they have in the past, which could be a real opportunity for dealers. That level of trust of familiarity simply isn’t there in the big box stores, which feature new faces almost every week.

Your dealership can offer your customers a stable, trusted environment, familiar faces, and a sense of community. But, you need to be open in order to support those relationships.

This is a theme you need to be using in your marketing as well. Your store is full of trusted experts that will take care of its customers. Home Depot can’t really say the same, not when their power equipment guy also works in plumbing and in the lumber department!

This is definitely an opportunity you, as a dealer, should be embracing right now.

Another smart way to compete is to use a portion of your marketing dollars to buy a billboard on the main route most people use to get to the big box store. This could be on the highway right before the exit, or on the main road the big box store is on. Again, it’s important that your billboard be on the route towards the store (not leaving the store!).

Doing this means that your target customer sees your billboard as they’re on their way to Home Depot or Lowe’s. And by reminding them that you’re a trusted part of the community, and only a mile further up the road, you’re hitting them right when they need you the most.

If you have reliable outdoor power equipment management software, then you can keep track of how effective this billboard is for your business.

Remember, don’t expect to see results from your marketing overnight. Marketing has always been a process, not a quick fix! There are always opportunities to capture some of the traffic from big box stores, especially if you’re right up the road.

Earn More By Creating a Positive Atmosphere In Your Dealership

Photo © by lumaxart

There’s no doubt that OPE dealers have it rough when it comes to their customer base.

Think about your average customer for a minute. He’s been out mowing grass, which he doesn’t like to do, when suddenly his mower breaks. Now he’s irritated because he’s got to stop what he’s doing to head up to your shop to see if you’ve got the part he needs to fix it. He’s in a hurry and already on edge before he even walks through the door.

You definitely want to create a great experience for everyone who walks in the door. And, this starts with treating your employees like you want to treat your customers.

Yeah, it’s a tough lot for OPE dealers. But by making a little effort, you can transform this cranky customer into a happy, long time fan of your business.
Here’s why: if your employees are angry, confused, and hostile because they don’t like working at your dealership, your customers are going to pick up on that tension immediately. It literally poisons the atmosphere of your shop, which is why going the extra mile to treat your team like family always pays off.

And, creating a great atmosphere for your team isn’t just about handing them a bigger paycheck. It’s about creating a great work experience and environment for them day in and day out. And, this starts with your attitude. If you come in with a bad attitude, then your team is going to have a bad attitude.

You’ve also got to get rid of the employees who constantly complain and contribute to the bad atmosphere. If they can’t stand their job, then they’re not going to treat your customers well.

Creating a profitable, organized shop is also vital to giving your customers a good experience. If your service department is chaotic, inefficient, unorganized, and dirty your customers are going to pick up on it. And, they’ll find another dealership.

So, your service department needs to be more efficient and profitable. And, this begins with your management.

To start, you have to have a real sense of where you’re at. This is where OPE business software can help. If you don’t have any idea what’s wrong with your service department right now, then you won’t know how to fix it to create a better customer experience. So, investing in OPE business software at the onset can really pay off.

You’ve also got to stop doing real-time billing. This is when you work on a piece for a half an hour, and then you charge that customer for half an hour’s worth of work. You’re never going to make money in your service department doing this. Instead, you need to think more like a car dealership and start doing flat-rate and menu-pricing on the bulk of the work your team does.

You can also improve your shop’s efficiency by offering your technicians a bonus when they reach 85% efficiency. This efficiency means higher profits for you as well as happier customers when their machine is fixed on time.

Creating happy customers starts with your team, and ends up with the dealership itself. When your team is happy and you’re running an organized, profitable dealership, your customers will keep coming back. Why? Because the overall atmosphere will be a positive one.

Saving Money with Strategic Inventory Management

Any outdoor power equipment dealer knows that when it comes to making a profit, inventory management is vital. And in a down economy it becomes even more important. By strategically managing your inventory, however, you can make a big difference in your bottom line.

During the slow time of year, your parts inventory should only be 20% of what your inventory was at peak of the season. For instance, if you carry $300,000 in inventory during peak summer then your off-season inventory should only be around $60,000.

Manufacturers used to be terrible at getting dealers parts on a short notice, so most dealers overstocked so they could service customers better and do repairs. Now, however, A-level manufacturers have a fill rate of 93-95%, and there’s no need to stock parts that you can order in 24-48 hours. We know that dealers love the idea of having the right part in stock every time a customer needs it, but it’s just not a smart practice in a down economy like this one. Even manufacturers don’t have a fill rate of 100% because it would just cost too much money to stock every arcane part. So, your dealership shouldn’t have that goal either.

To save money going into 2010 dealers should change their expectations and shoot for an 80%-85% fill rate at the counter. Doing this helps reduce your costs in inventory. Many dealers structure their parts department to primarily serve the service department. So, in many dealerships the service department becomes the biggest customer of the parts department, buying 60% or more of the parts in the existing inventory.

So what’s the secret to getting rid of your slow moving inventory?

The key is to create a good stocking point. One effective strategy is not to put a part in stock unless you get 3 demands for it within 70 days. And, this includes demands made from the service department. You can monitor these demands easily with good OPE business software.

Another mistake that dealers often make is ordering too many parts to stock when demand is going up. For instance, if you sell 4 parts one season and then 12 the next, you might be tempted to keep at least 6 of those parts in stock. But you have to analyze what’s happening with your customers. The reason they’re buying those parts in the first place is because that particular product is nearing the end of its lifecycle. This means demand is going to go up, and then drop off as that product is replaced. If you have several of those parts in stock, you might be stuck with them.

Overall, it’s vital not to let your parts inventory big in the beginning. It’s important to be as aggressive as possible with the manufacturers to get every part returned that you can, and keep your existing inventory low during the off-season. Investing in good OPE business software can help you strategically manage your inventory so that your dealership thrives during the upcoming year!