Re-Look at Your Vendor Programs
Wednesday, January 03, 2007
We've all heard about what's happened in the equipment leasing world over the last year or two. Many people are saying that there are fewer competitors out there and I believe that is certainly the case. Given that fact, you should spend time examining your dealer programs to make sure you're getting the most out of them. A couple of years ago, many leasing companies made concessions--rate or otherwise--to dealers that could have left for a competitor. If they have fewer options today because we are in a more realistic credit environment, then you should consider pulling back some of those concessions. It will certainly not be easy, and you shouldn’t do it across the board. But there are opportunities out there.
The key is to understand your vendors and know which ones you are giving away more than you have to. Now is the time to determine certain key factors about your customers: Who is the competition? What kinds of rates do they give? What are their credit policies? How is their service today? If there really is less competition out there, then the answers to those questions for many of your vendors will be significantly different than they were a year or two ago. You will probably find out that, for some of your dealers, you are their only leasing company. While it is usually not a good idea to take advantage of this too much, you can certainly look hard at those rate cuts you gave them over the last two years and tell them you need to revisit that $100K "app only" policy they made you put in place because their other source was doing it.
Of course, with reduced competition out there, now is the time to look at your existing programs and work hard at the dealers you never landed. How many times have you called on a vendor and got the feeling that they already have three leasing companies and aren’t interested in hearing from you? I’ll bet if you called them now you wouldn’t get the same response from most of them. Hopefully, you keep track of the objections you get from vendors. If so, design a campaign to call on those that were happy with their existing sources and didn’t need another. I’ll bet you'll find more that are willing to take your call and that many of them aren’t as happy with their existing sources.