Farm Equipment
Industry Outlook: How Does Your Dealership Stack Up?
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Increasing Productivity and Efficiency Boosts Dealership Profits in the Age of Amazon
Kelly Mathison, a consultant and trainer at the Western Equipment Dealers Assn. Dealer Institute, discusses emphasizing interdepartmental teamwork and personalized, rather than automated online-based, service in ag equipment dealerships in order to maximize profits per hour.
“What are the two critical factors that really drive the financial success of your business?”
Kelly Mathison, a consultant and trainer with the Dealer Institute at the Western Equipment Dealers Assn. (WEDA), asks this question to each farm equipment dealer he visits. With almost 30 years of experience in both consulting and ag equipment sales, Mathison knows right off the bat that the answers are profitability and cash generation, both of which are driven by each individual dealership's parts and service departments. His job is to use his knowledge to show dealership owners how to up their profit margin at their storefronts as websites such as eBay and Amazon continue to dominate the online sphere.
Dealer Takeaways
- If you add on even one part or service to every sale, your productivity and profits will quickly rise.
- Productivity should be spent mostly in the retail sector of your business, then in internal work, and finally in warranty.
- Treat the internet as your biggest competitor and focus your marketing on what you can do in-person that it cannot, rather than make it a price battle.
- Increase efficiency by teaching your parts and service departments to work as a team rather than as if there’s a wall between them.
Mathison begins by challenging dealers to set high long-term goals. His biggest benchmark is a one-to-one ratio of parts sold to labor billed per hour. “When we look at farm equipment dealerships all across North America, we’ve seen anything from 65, 70 cents to…
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Machinery Scope
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