A tale of two dealers
Jeff Foxworthy says, “If you think Taco Bell is a Mexican phone company, you may be a redneck.” I say, “If your customers are reading dog-eared magazines and watching Judge Judy on a TV that is as thick as it is wide, then you may be in trouble!”
Over the last few months we have been discussing a concept, the concept evolves around the retail tire and service sales counter.
In my 30 years in the tire business, I’ve never been in a store that didn’t have one. The sales counter is where the action is. It’s where sales are made, or not. It’s the final link in the chain between tire manufacturer and the end user, the consumer. The concept we have been discussing is all about the effective, professional and intelligent handling of customers at the sales counter. We call that counter intelligence.
Out of control
Last week I was on the road visiting tire dealers in California, the auto capital of North America. One out of every seven vehicles sold in the U.S. is sold in California, and the rate of tire replacement is 1.1 tires per vehicle per year. The market is huge. The California economy, though suffering currently, is greater than most nations of the world. There are over 14.2 million registered vehicles, equaling an annual replacement market of 15.6 million tire units.
You might conclude that there is enough tire business for everybody. That’s not so. The tire replacement market has been, and continues to be, in a state of flux. Much of the change that has occurred in the last 10 to 20 years has been on the manufacturer level, with consolidations that left Goodyear Tire & Rubber Co., Bridgestone Corp. and Groupe Michelin in control of the largest share of the global market.
Then you have the opening of the “clubs,” and the consolidation of wholesale and retail distribution — where regional players became national players, and you can see their retail and warehouse counts have soared.
These changes were out of the control of the independent retailers, yet have had lasting repercussions.
I believe that the next round of significant changes that will affect the independent dealer are more in his/her control than all the changes that have preceded them.
The first major change is how consumers are going to shop for tires.
Though retailers may not control how the consumer shops, they can control how they respond and assist the consumer in making a purchase decision. Consumers are going to buy over 15 million units in California alone, and they are going to shop and shop and shop!
They are going to call and visit and research more than they ever have. They are going to walk into stores where they have purchased tires in the past and challenge the sales staff like never before. They are going to ask questions that they have never asked, and they are going to show you ads and quotes and research, primarily from the Internet.
They are going to ask questions about load ratings and speed ratings and mileage ratings and eco ratings. You’re going to hear questions you’ve never heard from customers before.
Consumers are demanding value. They are not just looking for value; they are hunting it down with a vengeance. The Internet has emboldened many consumers, and they are empowered with information and knowledge.
I was listening carefully during my trip through the California market, and I can tell that many sales counter personnel currently are afraid to quote a price, and are very quick to offer discounts. They are timid and scared. It appears that certain sales staffs are not prepared to answer the “new” consumer. If this continues — where the consumer has control of the conversation — “then you may have a problem.” If I ever made a good, profitable sale while I was backed up against the wall, it was because I was lucky. Good, profitable customer service always starts with preparedness.
More good news: Customers want straight answers. They want competence. And they want fast and friendly, clean and courteous, polite and professional service. They want it all and they want it for less; yes, less! Less time, less nonsense, and, of course, less money!
By “nonsense,” I mean counter staff’s excuses for not being able to satisfy the customers’ needs. If we don’t become more counter intelligent, “then we may have a problem.”
Tell me if you can spot any problems.
During my recent road trip through California, 1,200-plus miles in three days, I visited a number of dealers, but two in particular come to mind. They both would be considered successful and established with over 20 years in business.
They both enjoy a good reputation in their communities. Their businesses have afforded them a comfortable lifestyle. Both pay their bills like clockwork, and enjoy good vendor relations. All of their locations are reasonably located with decent traffic patterns and attractive buildings.
I understand that businesses have a personality. All businesses have a DNA, and that is formed over many years, many challenges, and many decisions. In all cases all businesses take on the DNA of the owners or their management over time. Though both of these would be considered successful, there is a distinct difference at the sales counter. The energy levels are significantly different.
I spoke to the owners directly, and to the sales counter team at both locations.
Dealer #1 had magazines for the customers to read. Every magazine was old and dog-eared. An old TV sat on an end table you would be embarrassed to give to the Goodwill. The magazine table was white plastic. The TV table was Formica, with the corners peeled back and broken. None of the chairs matched, and they were dirty and uncomfortable. Half of the lights in the large showroom were turned off (presumably to save money), and the customer waiting area was located in the darkest area.
Dealer #2, however, had a bright showroom. The waiting area was larger by design, and more inviting with matching padded chairs that were properly arranged, which provided easy viewing of the large, flat screen TV. Several women and one gentleman were reading magazines that they had chosen from the magazine rack next to the small coffee island dispensing flavored coffee.
At the location of Dealer #1, the TV was off. The coffee had not been brewed in days. There was a counter stand dispensing an expired Monroe shock absorber offer.
Dealer #1 was a little disappointed, as he had to lay off an employee the day before due to lack of sales and profits. The main topic of conversation was competition in the area. When I asked about his Web site, he showed me his plan (nothing done), and explained that one of his tire reps was assisting him to integrate with their Web site. (I hate to say this, but most tire manufacturers’ current assistance in this critical digital area is less than satisfactory; not all, most.)
What he was really saying to me was, “I don’t have a plan, and I’m relying on someone else.” With recent studies indicating that 65% of consumers in the market for tires are researching the Internet, this dealer “may have a problem.”
Dealer #2 just finished his Web site upgrade and combined it with one of his tire vendors’ to enhance his digital footprint (not relying on the vendor, but collaborating).
One dealer’s business is up, and the other’s is down. There was excitement and focus and energy at one sales counter, and the other was downcast. One dealer was very optimistic about the future, and the other was not.
The main topic of conversation at Dealer #2 was training, training, training. I watched as one of his sales team members worked their “new, improved phone procedure.” It was obvious that some training and execution was taking place.
These items are critical: A clean, presentable showroom, trained sales staff, professional phone presentations, a relevant digital footprint including digital Yellow Pages, and your own Web site that tells your story! These are issues and items that are in the dealer’s control; in your control!
Take control if you don’t have control of the sales counter, if you don’t have control of your digital message, if you don’t have control of your showroom. You’ve got a problem!
Next month we will talk about the “Monster that has become completely unmanageable!” Until then, take control!
Wayne Williams is president of ExSell Marketing Inc., a “counter intelligence” firm based in La Habra, Calif. He can be reached at firstname.lastname@example.org.