In my opinion, there isn’t a better job in the ag equipment business than the used equipment guy. Used equipment is a commodity much like corn, soybeans, milk or cattle. Used equipment isn’t fluid or constant; it ebbs and flows with economic conditions of supply and demand. There isn’t a pricing manual somewhere that says if a tractor is “X” years old and has “X” hours, it is worth this much. People and companies have tried to create a crystal ball, but I am still waiting on mine.
The “Used Equipment Guy” has to understand the market and equally understand the drivers pushing the market, where the demand or lack of demand is coming from and why.
In the ag equipment business, the job titles “Used Equipment Manager” and “Remarketing Manager” are interchangeable. Most of the time, remarketing manager is the go-to job title. These are two different titles inside of the same role. The difference between used equipment manager and remarketing manager is directly tied to the dealership’s support and available resources.
How do I define a used equipment manager and a remarketing manager? The baseline of the two roles is the evaluation process. Both require a strong understanding of current market conditions. The used equipment manager and remarketing manager will also have to have a strong understanding of the dealership’s washout cycle for each machine segment. These are the baseline fundamentals needed to be successful, no matter the person.
The remarketing manager’s essential function is getting used equipment ready to sell. Good pictures, videos and developing and implementing a robust reconditioning process. The better these processes are, the faster equipment will sell and the more the washout cycle will speed up. The remarketing manager has to build strong working relationships with independent wholesalers, inline and non-inline dealers and jockeys.
The remarketing manager is a transactional selling beast. In most cases, the remarketing manager should be in the top 5 for volume and margin of all sales reps in the dealership. Every penny they sell is 100% from the sale of used equipment. The remarketing manager is focused on getting machines ready to sell and selling them.
If a territory sales rep is looking for something, the remarketing manage should know where multiple units are and, if not, know who to contact. They should know everyone, and everyone should know them.
So, if the remarketing manager is developing the reconditioning processes, evaluating the equipment, buying and selling in the retail and wholesale market and building relationships with everyone, what is the used equipment manager doing? The short answer is a lot.
The used equipment manager is looking at the macro as much as micro. A good used equipment manager can tell you what percentage of used combines are sold in a given month and what store should have them on their lot to maximize the salability. The used equipment manager will see retail, wholesale and auction trendlines develop and start sounding the alarm. They will spend most of their time digging up and looking at data to understand what is happening and why.
The used equipment manager will also know and understand which customers are and are not in the market to buy, based on trendline data. To the used equipment manager, data is everything. They have no emotion, and data is the guiding light. A used equipment manager is taking the “Money Ball” approach to inventory management.
In a perfect world with unlimited resources, a dealership could hire each of these people, and they would dominate every matrix. Turns would be high and stay high no matter the economic drivers. Cashflow and margins would maximized and opportunity would never be missed. Lastly, created high demand for used equipment would drive new equipment market share, not new equipment market share driving used equipment inventory.
Unfortunately, we don’t live in a land of gumdrops and candy canes. The dealership needs to take a hard look at their used equipment department and understand what they have and what they want. If the dealership has a highly transactional sales rep in the used equipment role, then don’t expect a used equipment manager.
If you have a data nerd that can tell how many used combines you will sell in the first half of October in the northwest corner of the territory, don’t expect them to have $20 million in sales.
The better a dealership understands their strengths while reallocating resources to prop up their weaknesses, the better the dealership will be. Don’t teach an old dog new tricks if you don’t have to. Make them really good at the tricks they already know.