Based on the feedback I've been getting on the C.H.O.I.C.E.® articles, I can conclude that most distributors fully understand there is an opportunity for significant improvement at the counter. This isn't to say that we are doing the wrong things; it just suggests there is more that we can do that will have benefits and value to the contractor, to the counter salesperson and to the company.
In the previous two articles, we looked at:
- What is C.H.O.I.C.E.®?
- Understanding what the customer wants.
- Why we can't do what we've always done.
- Why it's important to the company that the counter salesperson is successful.
- Why it's important to the counter salesperson that the company is successful.
- What the contractor-client expects from the distributor.
- HI - WHY - BYE: Client service best practices.
So at this point, we can say that the counter sales- person understands the importance of engaging the client, consciously building rapport and trust, and has fundamental skills around probing to discover why the client has come in or called that day.
How We Can Be of the Greatest Help to the Contractor
I asked this question of our readers in the last article and, frankly, no one had it exactly right. Not that the answers were all wrong; they were only partly right. The typical responses were about “servicing” the contractor including maintaining adequate inventory, quickly answering questions, taking care of problems, providing training and so on. These are all important and necessary activities, to be sure. But the question is, “How can we be of the greatest help to the contractor?”
The only correct answer is, simply put, that the contractor-client will value us the most if we help him be more profitable. There are three ways to get more money to the bottom line:
- Increase Sales.
- Increase Profit Margins.
- Lower Costs.
If we want to earn more business, we must do the things that will help the contractor-client become more profitable in one or more of these three ways. This isn't a counter salesperson's job, you say. On the contrary, I reply, there are many opportunities for the counterperson to contribute. Here are just a few examples.
Increasing Contractor Sales
Any new product that comes on the market.
Nearly everything we sell has some upgrade potential.
Nearly everything we sell has some accessory potential.
The idea that “Best - Better - Good” System Selling sells higher-end jobs.
The idea that including financing on every proposal will sell more higher-end jobs.
The idea that including a maintenance agreement on every sale will build a client-based business with future value and equity.
Increasing Contractor Profit Margins
Teach the contractor how to price for a profit (worksheet on my website).
Teach the contractor about the incremental profits that result from upgrading and System Selling.
Don't confuse this with lowering your prices. (The contractors will ask, it's their job … don't be offended.)
Show them a new product with labor-saving features.
Tell them about training workshops that teach better installation, service and business practices.
Show them how consolidating to one supplier saves significant overhead costs.
Once again, you say this is not the counterperson's job, nor are they capable of doing this. Heck, you say, you can't even get your territory managers to do these things.
On the contrary, I say, your counter salespersons can do these things, and more, if you train them to do them, and if you ask them to do them, and if you manage them, and if you reward them for it.
How to Differentiate Ourselves from the Competition
You have many competitors. Too many. The capacity for wholesale-distributors to supply the HVAC contractors' needs has exceeded the demand for the products and services they deliver. The result? Pressure on margins. Pressure for more services. Pressure for more creative customer/client support. All of this spells declining net profit.
And you know it.
What can you do? Whatever you do must include a strategy for creating some difference in what you offer vs. your competitors. Typically we look at doing this with product or programs … that's how we think. Rarely do we look at differentiating with people.
Think about it. If everyone differentiates with products and services, and few differentiate with people, wouldn't there be an advantage to be had here? Absolutely!
More of your customers/clients interact with your company through the counter than in any other way. Let's focus on what you can realistically do. There are many “golden moments” during the counterperson's day where you can make small but significant efforts that add to the client's experience. All of these apply whether the client comes into the store or calls.
Putting Hi-Why-Bye to Work
In the last article, we discussed the three-step model for customer engagement that includes, “Hi, Sam. Good to see you.” (Smiles, maybe gives a handshake, listens and engages.) “So tell me why you're here today.” (Listens and probes to find out if there is something more than just that specific product that the client might consider.) If the counter is slammed, this probably isn't going to happen. But when time permits, there could be an opportunity to discuss an alternative product, an accessory, an upgrade or even a related idea that might help the client increase sales, increase margins and/or lower business costs. Doing this in person, or on the phone, in itself differentiates you and your company.
“Anything else I can help you with? Okay, Sam, thanks again. I appreciate your business and look forward to seeing you the next time. Have fun on your fishing trip.”
Confident in Their Competence
The counter salesperson's ability and willingness to assist determines true value for the client. You must develop this ability to where she/he is completely confident in their ability to explain, support and, if needed, follow through on their suggestion. If they are not confident, what will happen? They either won't try at all, or when they do and it doesn't go exactly to plan, that “failure” will drive them back to the safe place of simply giving the client what they came in for. Confidence in their competence is the key. When any of us are confident, it shows, and it attracts to us others who are likely to follow our suggestions. Another way to look at this is it's not in the words that we say, it's where the words are coming from that really counts. If we are confident … it shows.
Now, you might be wondering what it would take to create this new breed of super counter salesperson business consultants. My suggestion is to take it one step at a time and build on their successes so that everyone on the counter feels like a winner. Begin now by taking one idea and training, coaching and managing that one idea to a mastery level. Once you've done that, bring another one to them.
For example, you and I know that many of the small contractors coming in or calling in are great guys, terrific mechanics, honest and proud … but they lack skill with certain business fundamentals. Let's say you believe that many of your counter clients could benefit from a simple job-pricing tool. Helping them learn how to price so that they create a decent net profit would be good for everyone, right? Just teaching some of them what gross profit and net profit mean would be a step forward. I'm not criticizing our clients, as I think you know; this is just where some of them are around business fundamentals. So have a training session on How to Price for a Profit (get the worksheet from my website) and have some role-playing using Hi-Why-Bye engagement.
Folks, I've had the privilege to work with hundreds of counterpersons, and I am certain that every one of them could handle this. If they are not doing it now, I'll bet it's because you haven't asked them to.
Who is losing by this not happening? Everyone is losing.
What are you going to do about that?
Tom Piscitelli is president of Applied Learning Associates, Inc., an HVACR consulting and sales training company. Contact Tom at 425/985-4534 or [email protected] for information on his seminars.
What is C.H.O.I.C.E.®?
I'm using the word “choice” to underscore a fundamental responsibility we have as someone who serves another (that's how I see “selling”… as a service) to do all we can to understand the other's needs and help them be successful:
- Care about the customer.
- Help them be successful.
- Offer your support.
- Inform them if they want information.
- Coach them on their choices.
- Encourage them to try something new.
|What was sold||Revenue||Make this go UP|
|What was paid for the job materials and labor||Direct Cost||Make this go DOWN|
|What's left so far||Gross Profit||To get MORE of this|
|Minus the cost of keeping the doors open||Overhead||Make this go DOWN|
|The Bottom Line … but they still have to pay state and federal taxes||Net Profit||For MORE of this … so they can do it again next year!!!|
Communication: Verbal and Nonverbal
A famous UCLA study revealed:
- Only 7 percent of communication is by words.
- 38 percent of communication is by “tone of voice.” (how you say it is more important than what you say)
- 55 percent of communication is body language.
Counterperson: Hey, Sam (handshake and smiling), good to see you. How did that fishing trip turn out?
Sam: Hey, Joe, it was really slow on the first day and I thought it would be a bust, but it got better on the second day, and on the third, man, it was great fishing. Want to know what I learned? One of these guides, just a kid really, took us out to 200 feet and killed the engine. Then he raised it so the lower unit was just slapping the water every time a swell lifted and dropped us. You wouldn't have believed it but it wasn't 10 minutes before we had two kings on. They were hot fish too, and it was a blast trying to keep them off of each other. Got ‘em both … twins at 23 pounds. What a trip!
Counterperson: Good for you. Well, you earned that luck if you got blanked on the first day. I'm going to remember that trick. So, what are you working on that I can help you with today?
Sam: I'm starting to get some AC add-on work with one of the builders I've been doing installs for. He doesn't want to deal with anything once the house is trimmed and he sends them to me. I give them a price and I'm getting work that way. I need two 3-ton 13 SEER units and everything else to do the jobs.
Counterperson: Fantastic. Glad to hear that. Let's get going on the order. (Starts creating the order.) By the way, Sam, do you mind me asking how you price this kind of work? Do you use the same markups that you used for the builder?
Sam: Yeah, same markups. I figure that's good enough. And they're saying yes.
Counterperson: Do you remember that class we had a couple of months ago on pricing and you were too busy to attend? I went to it and learned that pricing is more involved than I thought and that most contractors leave a lot of money on the table. The guy doing the class said that the contractors who do builder work make the least amount of profit, and he talked about how they also don't realize that add-on work should be priced at higher margins. You want to take a couple of minutes and look at a worksheet he gave us? I learned how to use it in 5 minutes.
Sam: Sure. If it helps me make more money, you know I'm interested.