Why is onboarding important? Imagine having a salesperson that is not all the great but has to remain on the sales team because of the close relationship they have to a few customers. Onboarding can come into play here as a tool that could have prevented the hiring of this salesperson or as a way of getting the replacement ready.
What if you hire someone from another dealership or industry and they bring bad habits to the table? Onboarding can be used to establish loyalty to the dealership and brands represented by the dealership.
“You’re not going to take and salesperson that you’re going to hire, give them the keys to a truck, give them a customer list and say, ‘go for it,’” says Kyle Schneider, used equipment manager, Stotz Equipment (2013 Dealership of the Year). “This is your opportunity to sit down with them, teach them what you want them to do and how to do it, and why your company does things the way they do.”
- Onboarding can be used as a way to not only establish the goals of the dealership but also as a way of creating loyalty to the dealership and brands represented.
- Slowing down the onboarding and hiring process will help in ensuring that the right person is hired for the job.
- Onboarding can be used as an opportunity to get rid of the bad habits that someone may carry over from a previous position.
Communicating and providing training to new staff is important if you want to have a successful team and dealership, but you also don’t want to overwhelm them. This is where setting up an onboarding process can help. Slowing things down and defining your dealership’s guidelines for the onboarding process are crucial to successfully onboarding new salespeople.
During the 2019 Dealership Minds Summit, Mark Kreps, vice president of sales, RDO Equipment and Kyle Schneider, used equipment manager, Stotz Equipment, discussed how their respective dealerships approach the onboarding process.
“Onboarding is not a magician. You need to make sure that it starts with the hiring process. You have to decide on the candidate, and you have to make a plan…” – Mark Kreps, RDO Equipment
RDO Equipment’s Slowed Down Approach to Onboarding
Over the last few years at RDO Equipment, the onboarding process has been slowed down allowing the team to take their time and make sure the right people are hired. While the hiring process is not part of the onboarding process, it is part of getting the right person onboard, says Kreps.
“Onboarding is not a magician. You need to make sure that it starts with the hiring process. You have to decide on the candidate, and you have to make a plan.”
At RDO Equipment, candidates start with a phone interview conducted by the HR specialist. The specialist takes notes and send those notes to the appropriate team members who decide which candidates will move to the next phase. Once the initial group is narrowed down, personality profiles are worked up for all candidates. This group then will meet with the hiring manager and potentially other people at the dealership, doing anywhere from 2-3 interviews.
Once the field is narrowed down more, the final step in the interview process is a panel interview. This consists of 4 or more people from the dealership interviewing the candidate at the same time. “We do this because you don’t know what kinds of person you are dealing with until you put them under some pressure and ask the right questions,” says Kreps.
2 Questions to Speed Up the Interview Process
In order to speed up the interview process and get an idea of which sales staff candidates are worth moving forward with, RDO Equipment has two questions they like to ask:
1. Tell me about your major purchases you’ve made in the last 3 years. Tell me what the most favorable purchase you made was and what the least favorable purchase you made was.
- “If their least favorable thing is they paid too much for a pickup or their most favorable one is they got a better deal because they played a game, don’t hire that guy,” says Mark Kreps, vice president of sales.
2. Tell us what you know about RDO Equipment Co.
- “If the person doesn’t take the time to find out more about your company, how much time will they take to find out about the customers you’re going to ask them to call on very shortly down the road if you hire them?”
For RDO, this process has two benefits: one, it makes the candidate feel like they’ve accomplished more if they make it through the entire process and get the job. Two, it gives RDO confidence and the feeling that the right person was hired.
The main goal for RDO is to eliminate panic hiring. “A lot of us say that we’re going to wait for the right candidate, but it seems like sometimes we take the guy that’s probably the best of the worst,” says Kreps. Being able to slow the onboarding process down and hire a strong staff of people has made the overall hiring and onboarding process simpler and has allowed RDO Equipment to bring on people they are confident in.
“We look at onboarding as we have systems in place to do all the nuts and bolts of training … But you’re hiring people that are going to represent you and you’re hiring people in an industry where there is such a deep attachment to that person you hired. You better make it right because if not, it’s going to cost you a lot of money.”
Stotz Equipment: Training for Success
At Stotz Equipment, the main goal of onboarding is to establish ground rules and create good habits. It also poses an opportunity to get rid of any bad habits before they can have any negative impact on the dealership, says Schneider. To accomplish this, Stotz starts with the basics, which includes going over company values and company vision and showing the difference that one individual can make in the lives of their customers.
“It’s important that, as you do your onboard training, you’re teaching your new salespeople the exact things you want for the dealership,” says Schneider.
“You’re not going to take and salesperson that you’re going to hire, give them the keys to a truck, give them a customer list and say, ‘go for it.’ This is your opportunity to sit down with them, teach them what you want them to do and how to do it, and why your company does things the way they do…” – Kyle Schneider, Stotz Equipment
Once the basics about the dealership have been covered, the onboarding process shifts into covering processes at Stotz. This includes processes for inventory, sales, rentals, training, commissions, expenses and marketing. For inventory, they go over the ordering process, finding a product and marking inventory. For sales, processes include:
- Finding out how they sell themselves, how they would sell a product and how they would meet a new customer
- How they quote
- What they present to the customer
- What’s required on trade values, who they go to and what they can expect when they get the trade value back
- Financing requirements and what is provided to salespeople for financing
- Requirements for closing a deal
- Types of warranties offered
“A lot of this seems redundant, but — especially if you bring in somebody from another dealership or another industry who’s been in sales — every one of us has a different process and we need to teach them so they can succeed within the organization,” says Schneider.
Stotz Equipment’s Gross Margin Exercise
At Stotz Equipment, one thing all salespeople go through is a gross margin exercise. This is because salespeople do not always know the difference between gross margin and markup. Kyle Schneider, used equipment manager, has experienced this first hand, having once had 4 salespeople in for training and getting 3 different answers in this exercise.
“It’s shocking to me in terms of all the training that I’ve done, how many salespeople come in and this is one of the most challenging things for them to do,” says Schneider. “Not only that, but it’s also shocking how many people don’t know how to trade a gross margin and they just do a markup.”
With this exercise, the salespeople go over how Stotz likes to do the math, so they all end up with the same gross margin numbers in the end. Doing this exercise ensures that salespeople are on the right track and that the business Stotz wants is being created.
The Importance of Training
Salespeople need to have knowledge of the dealership, the products and the customers in order to be successful. Providing this knowledge is important to Stotz Equipment and the best way to do so is through open and continuous communication. Because of this, communication is one of the biggest things emphasized during sales training, says Schneider.
To showcase the importance of communication and how much it effects dealership performance, Stotz Equipment created the Stotz Circle of Success. This circle is applied to all departments of the dealership and is used as both a training tool and as a way of showing an employee’s growth. At the center of the circle is communication because everything should start there and then branch out. Along with communication, Stotz emphasizes the significance of people, which includes dealership employees and customers.
Other aspects of the Circle of Success are process, customer satisfaction, profit and growth/market share. Having profit leads to growth in the salesperson and market share. This, according to Schneider, is what brings customers back to the dealership. “If you have the process and the people and you’re communicating, you should have customer satisfaction. This, in turn, should lead to profit, which we all want.”
The Stotz Circle of Success is empathized through the training process. According to Schneider, salespeople need to communicate and go through this circle in order to continue to grow as a company and as individuals.
For Stotz Equipment, training new salespeople is an important and continuous process. Early on, much of the day is committed to training which starts as soon as possible so new staff knows what is expected of them. The first week for new people is hard, says Schneider, but it gets easier and managers have meetings with new employees after 60 and 90 days of employment. These meetings allow them to check in and to go over some basic training again as a refresher.
At the end of the day, it’s important to Stotz that all opportunities to talk with or coach a salesperson are used, says Schneider. “We’re making sure we’re pushing them to become themselves so that they can do better for not only Stotz but for their own personal wellbeing as well.”
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