The Transition from an Equipment Dealership to a Technology Company

Alex Kraft
Feb 1, 2022

The heavy equipment dealership/rental house couldn’t be more opposite from the “start-up” world. But my dealership experience has helped me understand what is so special about the start-up environment. I started as a heavy equipment salesperson at 24 years old. It was my first “real job.” I didn’t know much about the industry before I started my career. As a young salesperson, I did my best to try and shadow some of the more successful vets, as well as pay attention to how the overall operation ran. It doesn’t take long to understand that “this is the way it’s always been done” is a mantra that is adhered to. The dollars are huge, brand names have been established, and dealers have protected territories. When you’re younger, you naturally ask a lot of questions: ‘why do we do it this way?’ and ‘has anyone thought to _____?’ Equipment dealers, and companies in general, are full of naysayers who love to tell you the three reasons why something won’t work. I’ve worked with tons of those people. There are those that probably would say I was that person at one time. It leads to constant stasis as no new ideas are introduced. You live in a world where it feels like the culture is, ‘let’s not screw this up’ as opposed to ‘let’s get this accomplished.’

When I took the risk of starting my own company, I had an idea based on my industry experience. We were now a start-up. One major difference off the bat: there are no bad ideas. Everything is a test. It’s incredibly liberating because nothing stays the same. Our team’s internal conversations usually start with, ‘we tried this for 30 days, this is what really worked well, this is where things fell off….’. We make a tweak and do another experiment. We’d fix that issue, then something else arises. We go through the same process all over again. I understand that this can seem exhausting for some, or for others who like structure it sounds like a nightmare, but for me it became such an energizing experience. I thought back to the times in my early career and realized how draining it can be to have teammates who are always shooting things down. Yet you sit in a customer meeting, and they tell you it’s your last chance because the people change, but nothing ever seems to change at your dealership.

With a start-up, it’s very empowering to work in a climate where it’s ok to be wrong, where it’s almost expected. When an idea doesn’t pan out, it’s because we tried it and have data that tells us it didn’t work. But also, what comes out of it are nuggets that we can apply to get a little bit better. Over time, those little incremental tweaks and improvements lead to a viable successful project. This entire process is what helped our young company figure out our niche and get traction with a new product in this market. If we were stubborn and had I shot down all my team’s ideas (since I was the only one with industry experience), we’d probably have folded up the tent and I’d be talking about what could have been. This is also what leads to great optimism because you become comfortable with the unknown, since your company is in a constant experimentation mode.

The point I want to get across in this post is to encourage dealer leaders to remember that they don’t have all the answers. And that’s ok. I may be wrong, but it seems like everyone is fearful of ‘digital’ and ‘technology’ because they represent new ways in an ‘old school’ industry. You may be the market leader right now and feel that you have the most to lose if you make some missteps trying something new. Technology can be a great equalizer for some other companies who aren’t afraid of embracing different ideas. Borrow a page from the start-up culture, and experiment in certain areas. Engage your teams and try something new, whether it’s in sales, rental, parts, or service. There is a large knowledge base in the market, so you all have team members with a great deal of experience. Start on a small scale, whether it’s selecting only one location as a test or a small sample size of customers. You don’t have to try a pilot across the entire company (actually I would discourage that since it may not be manageable). Give your employees the confidence that it’s their idea, it’s all in the interests of the company getting better, and they can be wrong! Let the results speak. Maybe it doesn’t get the intended result. That’s ok, at least you tried something different, and you know. The funny thing is, I bet your customers will be appreciative, because they respect your company trying to improve, and I bet your people will have some tweaks to the original idea that will get what you’re looking for. You will probably see a new energy among your employees as well, as they feel more connected to the company and in control of their destiny.