AS usual, the audience participation portion of the “Building Sales Relationships With Truck Dealers” session was far more provocative than the panelists' presentations.
The Q&A was only a minute old when the question was posed to Scott Silverman of Criswell Chevrolet in Gaithersburg, Maryland: “Do you receive kickbacks like Caribbean cruises? Do you control that as management or allow the salesmen to receive them as perks?”
“One thing that upsets me as a truck sales manager is when body companies want to add incentives like cash or trips to purchases,” Silverman said. “I don't find that to be professional. I find that takes away from the price value of the product. They're basically tacking that trip into the price.
“We have some large conglomerate body companies that will go directly to the owner of the dealership and completely bypass the management team, the sales department, the commercial department, the fleet department, and offer a package if they buy a certain number of trucks. We end up buying those trucks and end up having a lot more money in the trucks than we should. They sit there for two years and we finally end up selling them at a loss.
“The same body company will go to multiple dealers and sell them the same package. So you've got the same upfit at every other dealer, and you can't make any money on it because everybody's got the same thing. We'd rather have the best value and price for what you sell. Forget about all the incentive stuff. We don't need it.”
That was followed by a raucous cheer from those in attendance.
The session was sponsored by the NTEA Young Executives Network and featured moderator Allen Birmingham, Tommy Gate Co, Phoenix, Arizona, and a panel of four: Silverman; Bill McMaster, Tom Clark Chevrolet, McKeesport, Pennsylvania; Troy Richards, Hickory International, Bel Air, Maryland; and Casey Hardee, Jim Hardee Equipment Co, Lakeland, Florida.
Bidding Process an Issue
Another contentious issue was the bidding process. Several dealers mentioned that they need more lead time. One said he typically has a body company that calls with a bid at 7 p.m. when the process needs to be finalized the next day at 2 p.m.
“Forty-eight hours before the bid opens is a perfect time,” Silverman said.
He said the best relationships are forged with body companies that are proactive in monitoring his lots and charting the inventory.
“The most successful body company drives through our storage lot and our main lot — 1,400 units in stock — and makes a report of every truck, and he keeps a record of how many we sold last year and the year before,” he said. “He'll come in and make a proposal and say, ‘Look, this is what you've got in stock. This is what you did last year. You need 10 more utility bodies and seven more stake bodies.’ Just boom, boom, boom. He walks away with 20 or 30 sales in an hour.
“So if you guys want to increase your business, especially with the large dealers, check their inventory and keep good records — not just your products on their lot, but the other body companies'. We don't have a lot of time to think about it and talk about it. If somebody comes in and does our homework, it makes it easy to say, ‘OK.’ Maybe we cut his numbers in half. But we're still going to give him an order.”
Hardee, the only Young Executives Network distributor member on the panel, was asked how he prioritizes which dealers he uses. He said he asks the customer which he prefers, giving them maximum leeway in the decision-making process.
“If he says he doesn't have a particular favorite, we'll go to each one of the dealerships and say, ‘We have a customer who wants this,’ ” Hardee said. “We'll be upfront with them and say, ‘We're giving you and so-and-so and somebody else the opportunity. The customer is asking us to provide the pricing, so give us your best price and I'll present it to the customer.’ But turnabout is fair play. Once they give me their price, I'm not going to go from one dealership to the other and say, ‘Here's what he gave me. Can you beat it?’ ”
Changes Are Dramatic
Hardee said his father always told him that one thing he could always count on is change. He said that in his eight years in the business, he has seen some dramatic changes.
“The traditional relationship was a manufacturer selling to a distributor and a distributor selling to a truck dealer and a truck dealer selling to the end user,” he said. “Now we have a manufacturer selling directly to end users. This happens very often with national accounts. We have manufacturers of competing equipment that sell directly to truck dealers and do not sell through distributors. We also have manufacturers of equipment who are now buying chassis, stocking them and upfitting their body, and wanting me as their distributor to go out and sell these trucks and compete with my customers who are the truck dealers in my local area.
“We also have experienced some chassis dealers who are starting to become equipment dealers. By doing that, they're cutting me out of some of my business and also going in competition with me. So not only do I have pressure to go into competition with my customers, the truck dealers, but I'm also getting pressure from some of the truck dealers who want to compete with me on products I have provided in the past.”