Drive Machine Sales with AttachmentsBy Mary Sedor
Article Date: 07-01-2009
Copyright(C) 2009 Associated Equipment Distributors. All Rights Reserved.
Attachments manufacturers say opportunities exist for sales despite the grim economy, but dealers have a choice: Either seize the chance to explore new markets, or sit and wait for the upturn.
When the construction equipment industry reached its peak in 2007, attachments sales were also at an all-time high. Unfortunately, the global economic downturn has adversely affected attachments sales too, and several attachments manufacturers are reporting sales declines by as much as 40 percent. Some manufacturers predict the slowdown will continue through 2009, and at least through the first two quarters of 2010.
BYG Corp. expects increased attachments sales via auctions and used equipment sellers to further erode new attachments sales, as long as the downturn continues.
"Attachments sales are based on machine sales," said David Fegan, president of Wedgelock Corp. "Add to this the fact that the dealer buying pattern has changed, and the attachments purchasing basis has become ‘just-in-time.’"
The way contractors use attachments in a downturn also shifts, noted Duane Webb, marketing manager for Kenco Corp.
"During prosperous times, contractors use attachments as a way to make workloads easier, faster and more efficient," said Webb. "During periods of economic slowdown, contractors look for ways to do the same type of work, but with less manpower."
Most equipment dealers are focusing on survival now, rather than embracing opportunity.
"The obvious trend in the industry is that the larger, multistore dealerships are really focusing on inventory reduction," said Richard Lowe, president of Lowe Manufacturing. "OEMs are doing much the same thing as large dealerships and are keeping a lower level of inventory."
The harsh toll of the economy is ever-present in the financial reports of equipment manufacturers; however, there are a few bright spots in the attachments market.
Maverick Hammers reports that its business remains strong in Latin America.
"Business opportunities are still out there – you just have to hunt for them," said Sean Raimbeault, president of Maverick Hammers. "We do very well with a small, select group of dealerships that understand the synergy of attachments and machine sales. They cater to niche markets and are not totally dependent on homebuilding."
Lowe Manufacturing is also reporting better-than-industry-average sales. Lowe has not had any significant layoffs, shut downs or wage reductions – in fact, the company hired people for the summer. In addition, Rockland Manufacturing’s Director of Product Marketing Brad Oakes reports that his company is seeing increased activity in the lumber industry.
"Sixty-three percent of the time, hydraulic hammers are sold with a new machine," said Raimbeault. "If dealers can pursue the attachment business more aggressively, it will drive machinery sales."
Finding Opportunity in Hard Times
“We’re seeing success with more independent dealerships,” said Lowe. “Some dealerships are unfortunately sticking their heads in the sand, while others are out there making calls, visiting people and getting orders.”
A Lowe Manufacturing dealer in Wisconsin has sold six grapples since January, many of which were sold with the base machines, said Richard Lowe.
“There are people out there selling products,” said Lowe. “The bottom line is how much energy they are committing to finding the opportunities.”
In the current economic climate, end users are becoming more selective in terms of attachments quality and durability. Manufacturers advise dealers to provide a variety of attachments to end users in terms of overall value – and keep them in stock. In addition, finding an application for the attachment will assist the sale.
“It seems that everyone is kicking the tires a whole lot more than they used to,” said Oakes. “Search for attachments that are going to provide end users with a longer life and more reliability. You get what you pay for, and everyone in this economy is thinking about how much they are spending.”
Lowe agreed, adding, “Dealers should do more due diligence in researching quality and durability,” said Lowe. “Too often dealers look at attachments as an afterthought.”
What’s most important to keep in mind, especially now, says Lowe, is the customer.
“Too many dealers are looking too far inward, and they are forgetting that the customer with the dirty shoes is the one that drives the whole thing,” said Lowe. “Pay attention to what the customer truly wants. If you think of attachments just as a commodity you’re going to lose out.”
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