Are You Making These 3 Marketing Mistakes In Your Dealership?

By Ideal

Most OPE dealers know they need to be marketing themselves in some way. But, many owners rarely spend the time to learn how to market their store effectively. As a result, they end up wasting precious marketing dollars, and losing potential business. All because they’re making simple mistakes that can easily be fixed.

So, are you making these common marketing mistakes in your dealership?

Mistake #1: No Strategy

Do you have a marketing strategy for your dealership?

If you’re like most dealers, then the answer is probably “no”. This is one of the most common mistakes you can make with your marketing efforts.

Think of it this way: you wouldn’t start a business without a business plan, right? And you certainly wouldn’t head off on a road trip without a map.

Well, marketing your business is exactly the same. A marketing strategy is a road-map for where you want to go with your marketing, and a plan for what you want to achieve.

The Fix: Create a plan for your marketing efforts. Identify a goal first (like a 10% increase in sales this quarter), and then research a strategy for getting there.

Mistake #2: Living in the Past

Many dealerships don’t bother to gather their customers’ emails addresses. But, this is a huge mistake! Email is by far the cheapest and most effective way to communicate with your customers. You could be putting out a monthly newsletter filled with helpful tips and articles. This would keep you on your customers’ minds, and strengthen that level of trust.

The Fix: You can easily start gathering customer email addresses with your OPE point of sale software. Your employees can simply ask customers as they check out. You can motivate them to give their address by letting them know that you’ll be sending out special coupons and advance notice of sales (but make sure you follow through on this!). Email is also a very effective way to let customers know if there is a recall, or if there is warranty information they need to know about.

Mistake #3: No Idea How Much to Spend

It’s hard to know how much to spend on marketing. And, many dealers don’t create any kind of marketing budget at all. They simply do what they did the year before (like placing a radio ad in the fall and spring) and leave it at that.

But, just as you have a budget for your business, you need to create a budget for your marketing.

The Fix: Marketing is most effective when it’s done consistently. So, plan out a budget so you’re spending something each month to market your business. Most experts recommend that you spend 3%-5% of your total revenue on marketing. So, if you sell $1 million each year, then you need to be spending $30,000-$50,000 on marketing.

Last Word…

Marketing should be a vital part to any OPE dealership. If you’re currently making one (or all) of these marketing mistakes, then don’t worry! They’re easy to fix. Focus on creating a strategy, updating your marketing techniques, and planning out a budget that’s right for your dealership. These techniques will help ensure that you stay consistent with your marketing, and getting the most bang for your buck.

How to Get the Best From Your Employees

By Ideal

There’s no doubt that today’s customers expect excellent service. And if you’re going to compete with large chains like Home Depot or Lowe’s, then your services needs to go above and beyond the call of duty.

Unfortunately, it can be hard to get your team on the same page. To them, working at your dealership might just be a job. So how can you motivate your team so that your customers are receiving the best service (and, in turn, walking through your door again and again)?

1. Define What Excellent Customer Service MEANS

Many owners want their team to provide excellent customer service. But, this means a lot of different things to a lot of different people.

Photo © by www.lumaxart.com

You need to write out exactly what “Excellent Customer Service” means to YOU. And, post the list somewhere where everyone on your team can see it.

Your team needs to see that the customer is the most important person in the business, even more important than you. Go over the list with them, emphasizing why each element is so vital to the success of the dealership. After all, if customers don’t continue to come through the door, then the doors are going to close. Once your team fully understands this, they’ll hop on board.

2. Make Sure You’re Hiring the Best

Your employees are often the first people to interact with your customers, which is why you need to focus on hiring the very best employees you can find.

When you’re hiring, make sure your short-list of applicants take a drug test before your final decision. This will let you know who shouldn’t be trusted to work in your store.

It’s also important for you to pay attention to their personality. Do they talk easily to others? Are they well-groomed? Do they smile often?

You should also check and make sure that they’re comfortable using a computer. Put them in front of your OPE point of sale software, and just go through the basics with them. The faster they are on the computer, the less time your customers are going to have to wait.

Remember, this person is going to be interacting with your customers, representing your business. Choose someone who’s going to make a great impression. A good rule of thumb is to hire slowly, and fire quickly!

3. Never Make Training a One-Shot Affair

Many employees get trained when they start at a dealership. And then, that’s it.

Successful dealerships know that training should be continuous. The more experts you have on your team, the more your customers are going to keep coming back for the priceless advice they’re giving out.

Training is essential to creating a great team. Contact your suppliers and see if they can come out at least once per year for training sessions.

4. Make Sure Your Team Understands Their Worth

Does your team understand how valuable they are. Probably not.

So, let them know regularly what a great job they’re doing. Remind them, on a personal level, why you hired them. Hold them accountable for your dealership’s goals.

The more your team sees how much you value them the more pride they’re going to take in their work. They’ll feel a sense of ownership in the dealership which will, in turn, show up in the way they treat customers.

Last Word…

Getting your team on the same page as you when it comes to customer service isn’t that hard. All you have to do is give first: give them training, support, and a clear list of your expectations. Make sure they understand that you value them, and keep reminding them on a regular basis why you hired them. The more pride they feel in your dealership, the better they’re going to perform.

The Power of Small

By Ideal

Common Mistakes That Cause Your Dealership to Lose Customers

As an owner, it’s all too easy for you to become blind to the small details of your dealership. After all, you’re there every day. And when you’re there, you’re busy. You can’t go over everything with a fine toothed comb on a daily basis, right?

Well, no. But it’s helpful to take a step back every few weeks and look at the small things. Because it’s these small things that could be driving away your best customers.

Here are a few small, common mistakes that owners often overlook in their dealership.

Mistake #1: Exhaust Fumes

What do you think your customers think when they walk into your showroom and smell exhaust fumes? Now, some of your customers may like it. But many won’t. Today’s customers want clean stores that sparkle and smell good. Do what you can to put up additional barriers between your service department and the showroom to eliminate exhaust fumes leaking in.

Even if you don’t have a direct access from your showroom to the service department, check the smell of your space anyway. Is it pleasant, or at least neutral?

Try opening windows and doors when the weather is nice to let in some fresh air. Offgassing from equipment can create a stuffy, “plastic-smelling” environment which is not only unpleasant, but can actually be unhealthy. The more fresh air you can let in, the better your showroom will smell.

Mistake #2: A Low Fill Rate

It’s never a good business strategy to try and be all things to all people. But when a customer comes into your store, they usually want to get in and get out. Having what people need, versus an overstocked, overpriced stockroom, is a very fine line.

Dealerships should strive for a 90% fill rate. This means that 90% of the time, you have what your customers need right there in your store.

This is where OPE point of sale software comes in. A quality OPE point of sale software will allow you to track your customers’ buying habits, which will enable you to fully understand what they’re looking for. And when someone comes in and asks for something you don’t have, you can track that as well. Knowing what your customers want, and what they don’t want, will allow you to reach that 90% fill rate.

Mistake #3: Unclean Restrooms

Many owners don’t give much thought to the restroom. After all, most of the time it’s an area that someone else deals with. But many customers, especially women, pay very close attention to the cleanliness of restrooms.

How do you think customers react when they go into a store’s restroom and it’s dirty? What if they have small children, and have to change a diaper? Would you want to change your child’s diaper in a dirty restroom? Definitely not.

Unclean restrooms can create a very negative reaction in your customers, both men and women. Make sure they’re cleaned daily (or more, if you’re busy). Make sure there is good soap, ample paper towels, and hand sanitizer. It also wouldn’t hurt to hang up some attractive pictures, and make it as comfortable and pleasant as possible. Your customers will notice.

Last Word…

When you’re looking for ways to keep your current customers coming in your door, don’t forget to notice the little things. They may not seem like much, but it’s often the smallest changes that can make the biggest difference.

Easy Strategies to Get Customers in Your Door

By Ideal

As the owner of a dealership, whether it’s large or small, it’s easy to get tied up in the day-to-day workings of your business and forget to step back and look at your larger purpose: that is, providing amazing service to your customers.

But first you have to get them in the door. Let’s take a look at some tips you can use to make your customers happy and set yourself apart from your competition.

Strategy #1: Improve Your Parking

Many owners don’t think twice about their parking. After all, it’s a parking lot. What’s the big deal?

Well, it’s a big deal to your customers because most of the time, they’re in a hurry. They want to get in and get out so they can get on with their day. Customers can easily get annoyed with parking lots that are too small. And, this annoyance can cause them to go somewhere else.

A good rule of thumb is that for every square foot of your retail store, you need five square feet of parking.

It’s also important to analyze how your lot is laid out. Many customers can’t walk easily on gravel, so using asphalt is your best bet. Your lot should always be clean and attractively landscaped. Remember, this is your customers’ first impression of your dealership when they pull in. Make it a good one.

Strategy #2: Improve Your Curb Appeal

Your customers want to know that they’re shopping at the best store. And, this realization starts with how your store looks from the outside. Curb appeal is extremely important for dealerships, and yet most owners don’t give it a second thought. Their focus is the inside of their store-not the outside.

Go outside and look at your building from across the street. How does your store look…is it attractive, or dirty? Can potential customers easily read your signs? Is your garbage bin placed where everyone can see it, or is it hidden in the back? Are the windows clean?

Make every effort to improve the curb appeal of your building. All these little details send big signals to your potential customers about the quality of service they can expect from you and your team. When you take excellent care of your building, and how it looks, your customers know that they can expect the same level of attention once they go inside.

Strategy #3: Make Sure You Have an Identity

Some dealerships try to be all things to all people. But you know how the old saying goes…when you try to please everyone you end up pleasing no one. Dealers that carry several different brands of the same product just end up confusing their customers with information overload. And then, they don’t end up making a purchasing decision.

If this sounds like you, then use your OPE point of sale software to determine which products you’re selling the most of. These products should become your identity. Take the time to become an expert on these core products, and let the rest go. You’ll better service your customers with your in-depth knowledge of these items, and you’ll help them avoid the confusion from having too many choices.

Last Word…

Having a successful dealership means you put your customers, and their wants and needs, first. Strategies like improving your parking lot, improving your curb appeal, and using your OPE point of sale software to improve your product selection can go a long way towards getting customers in the door, and keeping them around over the long term.

How to Impress Your Customers…On the Phone

By Ideal

Most OPE dealerships today have plenty of competition. And, it’s all too easy for customers to drive to a big box store and get a discount that many dealers can’t match. But, dealerships can win these customers back by providing excellent, personal service to everyone who walks through their door.

Providing excellent service benefits everyone. Your customers feel truly special when you treat them with attention and respect. You and your team feel good because you know you’re doing the right thing. And, your business benefits because not only will your customers keep coming back, but they’ll tell their friends and family about the great experience they had in your store.

Big box stores usually can’t compete on this level.

So, how can you do about wowing your customers? Well, it all starts with a phone call.

1. Avoid the “Hold” Button

It’s easy to forget that providing excellent customer service starts the moment the phone rings. Often, the biggest frustration a customer experiences is when they’re put on hold. At a big box store, this is standard fare. So, make it a goal not to put your customers on hold, and never for more than thirty seconds.

2. Act Like the Customer Is Right There

When a customer calls you’re not always going to be able to answer their question right then and there. You might be with another customer, or you might need time to research their question. It’s vital that you, and your team, return each call that comes in. Forgetting to return calls reflects very poorly on your business, and customers won’t keep calling back. Treat each phone call as if the customer is right there in your store, and return their call as quickly as possible.

3. Don’t Overuse Your Technology

Today’s technology is a marvelous thing, especially when it comes to OPE office management software. These days we can track our customers’ buying habits, record lost sales, send out e-newsletters to educate our customers…all of which we couldn’t do just 20 years ago. But it’s important not to let technology get in the way of your customer service, especially on the phone.

Many larger dealerships have an automated answering service. When the phone rings, a machine picks up and directs the customer to the correct department. Although this is convenient for the dealership, how convenient is it for the customer?

Usually, not very convenient at all. In fact, most customers are annoyed by automated answering services. So why use them if you don’t have to?

4. Coach Your Team

Is your team aware of how important every phone call is, and the impact these phone calls have on the dealership’s success? Probably not. So during your next staff meeting or morning huddle, share these tips, and other rules for phone etiquette. When they realize how important these calls are, they’ll want to go the extra mile for each customer.

Last Word…

Photo © by LordFerguson

You and your team need to spend as much time as possible interacting with customers, and that includes the moment they call in with a question. The more opportunities you have to impress your customers, even on the phone, the likelier they are to come to your dealership first, and spread the word about the great job you’re doing.

Remember, many customers interact with your business for the first time over the phone. This means that you and your team really need to make a great first impression!

2 Strategies For Improving Profits In Your Service Department

By Ideal

Every dealership wants to be profitable. But if there’s a weak area for most owners, it’s going to be the service department. Between managing techs, managing parts, and overseeing billing, there are plenty of places costs can spiral out of control and opportunities for increasing profit margins can get overlooked.

The good news is that there are plenty of ways you can ensure efficiency and stay on top of your billing and techs in your service department.

Strategy #1: Know Where You’re At

Profitable dealerships always know where they’re at financially. Not knowing where you stand is just like setting out on long journey with no map, and no idea where you’re starting from. It’s just not a smart way to move forward!

Quality OPE office management software allows you to see within seconds exactly where your dealership, and your shop specifically, stands financially. You can keep track of parts inventory, your techs billable hours, and how much work you have scheduled in the days and weeks to come.

Staying on top of these metrics gives you, as an owner, a feeling of control that you simply don’t have without a smart system in place. Plus, having a complete picture of your shop, and where you stand, allows you to spot opportunities for growth, or areas where you could trim costs.

Strategy #2: Stop Real Time Billing

Another smart strategy you can use to make your shop more profitable is to stop real time billing.

Real time billing is when you work on a piece of equipment for ½ hour, and then you charge your customer for ½ hour’s worth of work. The problem with real time billing is that it eats away at your profits.

For instance, you may know that a certain job is going to take your A-level techs half an hour to complete, so that’s what you quote your customer. But what happens when you only have a B-level tech available, and it takes them ¾ hour to do the job? Well, you just lost that ¼ hour.

Dealers that have profitable service departments operate more like car dealerships. They have an extensive list of menu and flat-rate pricing on the bulk of the work they do.

Think about this example: if you’re replacing the center spindle on a zero-turn mower, you know your A-level tech can get this done in about ¼ hour if he’s using a lift. But, you would bill this at ¾ hour. Why? Because there’s a good chance that one of your B-level techs

will be doing this job, and it’s going to take them almost ¾ hour to get it finished.

This not only improves your profits when an A-level tech does this job, but it ensures you’re not losing money when a B-level tech gets involved.

You can manage this by making sure every piece of equipment that’s brought into your shop is looked at by a qualified technician. This way a time and a price has been put on that equipment before it’s processed for service. The advantage to this “triage system” is that technicians know beforehand how much time has been allocated to complete that particular job.

Your technicians should also be keeping track of their time with outdoor power equipment technician software, or at least some kind of time log. Many dealers will use these time logs to spur efficiency and motivation in their techs.

Your service department can be an incredibly profitable part of your dealership. By using quality outdoor power equipment office management software to stay on top of key metrics and by setting up a flat rate pricing system, you’ll ensure that your service department carries their weight in the years to come.

Are You Measuring These Key Metrics In Your Dealership?

By Ideal

When was the last time you looked at the gross profit margin in your service department? Or, for that matter, how long has it been since you measured the profit margin of your showroom compared to your available square footage?

It’s easy for owners to get so wrapped up in the day-to-day workings of their dealerships that they neglect to look at key metrics on a weekly or monthly basis. But, these metrics exist for one purpose: to help you measure the health and forward progress of your business. When you go without looking at them, it’s like trying to sail a ship without a rudder or a map. In other words, it’s not something you want to do unless you actually want to get somewhere.

Successful dealerships use quality outdoor power equipment office software to help them measure these key metrics. OPE office management software can give you access to vital information about your business in just minutes, and can drastically shorten the “information gathering” time you’d spend without it.

So, what should you be looking at on a weekly basis to make sure you’re meeting your goals for the year?

The most important performance indicator that you need to be looking at weekly is your gross profit margin on parts, whole goods, and service. If you do rentals in your dealership, then you also need to look at your gross profit margins in this department as well.

Determining where you need to be will vary slightly with each dealership, but in your service department you should be aiming for a gross profit margin of 50%-55%. Your parts should be 48%-53% for OEM, and for aftermarket 60%-70%.

When it comes to your whole goods, you need to analyze this number as it’s compared to the total square footage of your showroom space.

Another key metric you should be looking at is the management cost per dollar sold in each department. Some dealerships are very small, which means that owners are also working as managers. If this is the case in your dealership, then you need to take into account your salary just as you would a manager that you had working for you full time.

When it comes to the metrics you need to be looking at on a monthly basis, parts aging and inventory turns are probably the most important. Now, doing this without OPE office management software is going to be challenging, which is why so many owners find that investing in quality software is more than worth it.

The reason why it’s so important to look at these two metrics monthly is because it’s so easy to let parts and inventory slide through the cracks, especially during the busy seasons. Most dealers only look at this information at the end of the year, since that’s when they do the bulk of their buying.

Staying on top of the key metrics of your dealership is easy if you have quality software to do the work for you. Even if you don’t, however, it’s vital you spend the time compiling this information. These metrics show you clearly how your business is doing. If you discover that you have aging parts and falling margins, you can take action to fix the problem before things get out of control. And that can make the difference between a thriving, and failing, dealership.

How To Earn More Money In Your Parts Department

By Ideal

Photo © by swanksalot

Every owner knows that managing parts can be an incredible headache. You can have literally thousands of parts stocked, but if they’re the wrong ones then they’re not going to move. And then you’re left with a ton of cash tied up in something that’s just sitting on the shelf.

The good news here is that there are several strategies you can use to make sure that your parts department earns you money consistently.

Strategy #1: Identify Your Biggest Customer

Many dealers make the mistake of thinking that when it comes to parts, their biggest customers are the commercial accounts or individuals that walk through the door. But, this is almost always wrong.

Why?

Because the customer buying the most parts from you is your own service department.

Successful dealerships recognize this, and they earn more simply by structuring their parts department to fit the needs of their service department. Service departments, when run well, can really add to the profitability of a dealership. Your goal should be to make sure the service department has the parts they need on-hand so shop efficiency is improved.

Strategy #2: Don’t Try To Stock Everything

Many dealers try to keep everything they can in stock for when customers walk through the door. Some even strive to have parts on-hand for equipment that’s 30 or 40 years old!
What’s wrong with this?

Well, doing this means you’re trying up money and shelf space on parts that very few, if any, customers will ever come looking for. Even manufacturers don’t have a fill rate of 100%. So why should you?

Focus on the parts your shop needs first, and then on the parts that your customers come looking for most. You can track this information with quality OPE office management software, and this can really take the headache out of looking for this data.

Strategy #3: Create A Reliable Stocking Point

So how do you know which parts you should be stocking? Successful dealerships make it a rule not to keep a part on-hand unless three customers come looking for it within a 70-day period.

This information can be almost impossible to track without good OPE office management software. Your software can record this as a “lost sale” every time a customer comes asking for it, which will allow you to see what people are looking for and which opportunities you’re missing to add revenue to your dealership.

It’s important to stick to the formula of three customers within 70-days. When someone needs a part, many dealers will place an order and then add an extra part on to keep on-hand. But this is how a parts department gets bloated, tying up more revenue and shelf space than it needs to.

Sticking to the guideline of three customers within 70-days will ensure that your department doesn’t get out of control with parts people just aren’t looking for.

Although managing parts can be challenging, using smart strategies and having good OPE office management software can make all the difference.

What Does A Dealer In the Outdoor Power Equipment Industry Expect?

By Ideal

Ideal Computer Systems sat down with Rod Schutzman for an eye-opening interview with a successful OPE dealer that gives insight into what manufacturer reps’ clients really think of them- and why.

Rod is the owner and general manager of Midway Outdoor Equipment in Hiawatha, Iowa. He has been in this industry basically all my life, but has been involved with managing his business since about 1986.

Ideal: What upcoming changes do you see for the industry?

Rod: There are a lot of changes going on in the industry. There’s more competition, I don’t know that that’s really new, but it’s more prevalent now because of shrinking margins. Business owners have to really concentrate on the service end to generate more service dollars, generating more parts business, and maybe becoming a little less dependent on whole goods sales and being very competitive in whole good sales.

Other changes I see in the industry are utilizing more and more of the new technology, the types of things that Ideal is offering in their business management systems in terms of generating reports and just having the tools necessary to manage the business.

Ideal: As a dealer, how many different reps do you work with?

Rod: There’s basically one for almost every manufacturer, plus additional parts suppliers. There’s probably 10-12 that we primarily deal with on a regular basis.

Ideal: By regular basis, what do you mean by that? On average, how often do you meet or talk with these reps?

Rod: That varies, most of them of every 30-90 days.

Ideal: We had a conversation recently in which you mentioned that reps tend to fall into one of three categories: nuisance, friend or ally. Describe each one. How does each one differ from the other?

Rod: A nuisance would be someone comes in and wants to talk about everything except business, who doesn’t know the answers to questions or doesn’t at least try to find the answers, and doesn’t follow up. They don’t add much value; they simply come in and take up time.

A friend is someone you like and enjoy spending time with but may still not be the most helpful in terms of representing a line or helping you in business in general.

An ally is involved in our business, they help us grow our business, help us manage our inventory, and assist with a lot of different issues. The people who do those things are going to be a lot more successful with dealers.

The other thing that’s really important that a successful rep does is to call ahead, to be respectful of my time and let us know that he’s going to be coming in at least a day or two in advance. Or if he’s running late give us a phone call and let us know. I think that sometimes they forget that being in a retail environment we have to manage our time to handle business operations and it’s not convenient to have someone drop in unexpectedly.
There may specific problems or questions I have and I haven’t had a chance to gather those thoughts for our meeting.

In my mind one of the main duties of reps is to make sure that we have the latest promotional programs. It’s important because if a dealer carries multiple lines it can become very confusing to keep-up-to-date with the latest programs, promotional pricing, and retail financing because those programs tend to change almost monthly.

During our busiest months, if a rep is physically here it’s very nice to have them set up some equipment, fill in our missing spots on the floor, and make sure that our price tags and hang tags are current.

It’s a good idea for the rep to check our stock levels and help us identify as a supplier to us if they have issues or problems as far as their stocks or supplies. Help us manage our inventory, especially if there’s a supply problem. Also, if we’ve got some old stock that we’re having problems moving help us move it.

Reps can help with problems in sales, invoicing from suppliers, warranty or service issues. The reps won’t always have those answers, but if they can at least get us to the right people and then follow up to make sure that they were resolved. They are our main point of contact and it’s easier for them to follow up than anyone else.

Ideal: If you could give reps one piece of advice, what would it be?

Rod: Well that would be a two part answer for me. Value my time and follow up.

Question of the month: As a manufacturer or distributor rep what is your biggest obstacle to professional success?

By Ideal

In order to get a feel for the issues that OPE Reps face, Ideal posed the following question:

“As a manufacturer or distributor rep what is your biggest obstacle to professional success”?

The responses demonstrated a wide range of concerns …

“The lack of a one stop shop, a complete knowledge bank for industry information like parts look-ups.”

“The apprehension that dealers have in the economy.  People fixed a lot of tired equipment last year and dealers are still ordering accordingly”

“The resistance within the industry to change.”

“The amount of competition that has sprung up over the past few years”.

“Dealers not being able to get financing.”

“Fewer dealers and therefore less opportunity.”

“Organization.  I didn’t grow up with computers so I’ve had to learn over the past few years how to keep everything organized and integrated with my computer and phone.”

“I wouldn’t say that it’s the economy, it’s actually doing fairly well in our industry (OPE).  I’d say it’s competition, it always has been.”

“Dealerships having a hard time retaining good people.  They tend to lose them due to lack of pay, lack of training, or just better opportunities”.

“Retail financing”.

“A lack of good customer service from dealers”.

“Dealers that don’t use their computers effectively.  Too many are computer illiterate and many won’t even check their email for weeks”.

“The biggest obstacle for me is always the weather”.

“The financial well-being of my dealers.  Things aren’t as bad as last year, but it isn’t getting a lot better yet”.

“Half the time my job is like cat herding because everyone has their own little issues that need to be dealt with”.