In response to my first article in Farm Equipment, I received the following e-mail from a dealer that summarizes many of the trials and tribulations afflicting ag dealers and their sales management team in this time of prosperity.
“I tracked down your latest gospel. I think you have struck the right tone. This has to be the most under managed industry in the world. I have announced to my tribe one of our goals next year is to move from ‘pushing iron’ to ‘account management.’ Some get it, some think I’m from planet Xeron. I have two salesmen who never leave the office waiting for prosperity to walk through the door. I look forward to your thoughts.” My thoughts are relatively simple. Unless the dealership is selling consumer products, i.e., lawn mowers, all-terrain vehicles or other consumer-oriented products, salespersonnel should be PROHIBITED from sitting in the dealership. Period! Final! Finito! In this day of cell-phones, e-mail and text messaging, it is ludicrous to believe that a salesperson is needed to sit in the dealership to handle walk-in traffic. In the selling of capital goods, the statistics show that few buyers simply wake up in the morning, kiss their wives and drive off to the nearest ag dealership to spend a discretionary $300,000 for a new combine or 4WD tractor. Instead, prudent and judicious buyers of capital goods begin their purchase process up to 13 months prior to the actual purchase. Prior to actually purchasing, but subsequent to recognizing a need, the end-user will judiciously utilize his time identifying solutions, evaluating benefits, analyzing alternatives and vocalizing concerns. If a close relationship has been developed with a dealership salesperson, then it is likely that most of these steps will take place under the guidance and watchful eye of that salesperson. If, on the other hand, a relationship has not been forged, which regrettably is the norm rather than the exception, then the end-user will spend his time visiting dealerships and interacting with order-takers in the hopes of having his questions answered while concomitantly ferreting out the lowest possible price. Thus, when a customer comes walking through the front door and proclaims that he is going to “buy today,” the groundwork has been laid. This purchaser, in all probability, has a pretty good idea of where he is going to buy, who he is going to buy from, and how much he is going to spend. Contrary to popular belief, the order taker waiting for his next victim has very little probability of consummating this sale. In fact, statistics would reveal that the salesperson has less than a one in 10 chance of closing that sale, and if in fact a sale does materialize, it is almost always on the basis of price. Yet dealerships, for whatever reason, continue to have a salesperson, or multiple sales people, sit in the dealership (see above). In fact, it is not uncommon for a dealer or sales manager to “ask” their salespersonnel to sit in the dealership. This is simply an abdication of managerial responsibility. Again, unless the dealership is selling consumer products, there would be no reason for a salesperson to sit in the dealership. Instead of sitting in the dealership, salespersonnel should be required to submit, via e-mail, a “call schedule” to the dealership by 8:00 A.M. each and every Monday morning. Rather than coming to the dealership and squandering their time gossiping with other dealership employees or getting caught up in the mundane issues of a typical dealership, salespersonnel should begin their day and their week with a plan of who they are going to be calling on. The primary responsibility of the sales staff should be to maximize their number of “quality” on-site contacts. A day in the dealership will typically “cost” the salesperson 5-8 on-site calls. One day a week in the dealership voids 250-400 calls a year. At 400 calls a year, a successful salesperson could call on 50 different prospects 8 times a year, or every 31 business days. With that kind of repeat call frequency, profitable sales would certainly increase. With cotton prices at an all time high and with corn and bean prices purged to once again take off, this is the time to reassess your sales team. Why retain non-producing automatons when they can “easily” be replaced with young, potential field marketers, which with the proper training should be a significant sales team contributor within the next two years? Now ask yourself the following question, “During the next downturn, would you like to have your existing order taker sitting in the dealership waiting for his next victim, or a young, well trained field marketer out making calls and selling dealership value?” If you selected the latter approach, congratulations, you are on your way to increasing profitable sales and sustaining, rather than renting, market share.