Who Sells Parts And Service?Written By: Ron Slee
Article Date: 03-01-2007
Copyright(C) 2008 Associated Equipment Distributors. All Rights Reserved.
Hire a product support sales rep for every $1.5 million in parts & service business.
According to the 2007 CIT survey, 58 percent of contractors, your customers, are going to handle the repairs and maintenance on their equipment. This represents a wonderful opportunity, but also a powerful indictment of past performance. There was another telling statistic in the survey that said the average age of the equipment in the contractor's fleets has increased from 5.8 years to 6.5 years. Consider the fact that most of the current production equipment has very complicated technology to allow the machine to reach its full potential. This technology built into the machines gives us a very strong competitive advantage with our factory trained and equipped technicians.
So how is the customer able to service their machines properly? In order to protect the functional effectiveness of the equipment we represent in the market, we need to be able to perform more of the repair and maintenance than 42 percent. How do you get the business? I think it's pretty clear. The days of letting the shingle sell for you are over. In fact they've been over for a long time. For decades, we've been watching our parts and service market position get weaker and weaker. We simply have not done our job in the marketplace. We have not been looking after our customers.
You need a product support sales function in the dealership. If you don't sell it, someone else will. Forget all of those people that say that product support sales are a luxury you can't afford. Quite frankly they don't know what they're talking about.
So you decide to cover the market with people to sell parts and service and programs. How many do you need? Divide your customer parts and service sales volume by $1.5 million and that's the number of product support sales reps you need. The range is $1.2 million to $1.8 million in parts and service sales per product support sales rep per year.
You might be surprised at how many of these specialized sales reps you need. In fact, if it was my decision you would have a product support sales rep for each equipment sales rep. Yes, that's right a 1:1 ratio between equipment sales reps and product support sales reps.
Product support sales reps perform two basic functions. They protect your business from your competitors - the huggers - and they grow your business and increase market share - the hunters. They are businessmen. They develop relationships with your customers. They deal in customer satisfaction and retaining your customers. In fact, to quote an old adage, "the equipment sales rep sells the first machine; it's product support that sells the rest."
That's very true. But because we have not covered our markets properly with product support sales reps, we‘ve had to fight to maintain market share. We've let others define us in the marketplace. And they're not complimentary. They say we're over-priced and that we're as good technically as our competition. They say we're not responsive and convenient to deal with. They tell our customers we never have the right part on the shelf. Customer surveys have been telling us this for years. Yet we still haven't acted.
Add product support reps until you have one for every $1.5 million in parts and service business. And don't let them go because you think you'll save money. If the sales rep is not productive, get one that is. But don't let them go to save money. The money you save in the short term pales beside the money you lose in the long term.
You need more product support sales reps NOW.
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