Following up and raising prices

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There likely aren’t two things that concern retail dealers more than developing a successful lead management process and determining when it’s good to raise prices. Both should be on the radar.

First, right now we’re in the heart of the industry’s fall boat show schedule where sales teams are (or should be) gathering significant numbers of leads. It’s a great time to evaluate the effectiveness of your lead management.

On Wednesday, members of the Marine Retailers Association of the Americas will get that chance. They’ll be able to measure the effectiveness of their lead system via a webinar entitled “Pre-Sale Follow Up, Post Sale Follow Up Lead Management.” (If you’re a marine retailer and not an MRAA member, you should join.)

It’s the fifth in a series of eight webinars in the MRAA’s 2014 Digital Marketing Master Series. It will help attendees develop a lead management strategy designed to attract customers and prospects back.

The MRAA has teamed up with ARI to produce this series and it’s offered free exclusively to MRAA members. The series has been developed to give dealers a clear picture of digital marketing while demystifying today’s technology tools that can help sell more boats. Here are the webinar details:

What: Pre-Sale Follow Up, Post Sale Follow Up Lead Management Webinar, Wednesday, Oct. 15 at 11 a.m. Eastern. To join the MRAA and attend the webinar, go to www.mraa.com.

Second, when it comes to raising prices, it’s always a dilemma for dealers. However, as manufacturers and suppliers raise prices, dealers need to do it, too. After all, a solid profit margin means long-term stability for every dealership.

The “official” word, of course, is that inflation is low and has been for more than 5 years. Yes and no. When inflation makes the evening news, it’s mostly focused on consumers feeling its pinch — the monthly Consumer Price Index, which has remained low. However, the same has not been true for businesses.

It’s the Producer Price Index that measures the rate of inflation that retailers face when buying products and service from manufacturers and producers. In a perfect world, the CPI and the PPI would fly in unison. But things are never perfect and for the last three years the PPI has exceeded the CPI. Simplified, it means retailers haven’t been raising prices to cover their increased costs. They’ve been absorbing part or all of the cost increases, likely out of fear that consumers won’t buy if they attempt to cover their higher costs.

Raising prices is always a tough call. If too much, it risks losing a prospect or customer, cash flow and profit. Not doing so as to achieve a needed margin can really cripple a dealer’s ability to meet an unanticipated problem, or an opportunity.

Many of the current economic signs support passing along increased costs to customers. For example, consumers are feelings wealthier as their home values are rising. Equity loans are reportedly increasing again. The unemployment rate continues to drop. Consumer lending for autos are on a fast pace. The consumer confidence index is up and approaching pre-recession levels. The overall economic direction is positive.

When prospects feel good, they’ll spend more.

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