The Power of Demand and Connection

By Andre Nataf
Tuesday, January 28, 2020


The world has moved to recurring revenue models for just about everything, from refrigerators to cars to POS and everything in between. There are many advantages to renting instead of buying for business owners, but there’s no doubt that recurring revenue business has a much greater value than a perpetual modeled business for Dealers. When I think about items people own for more than a season, I think about how long they’ll have the item before they want, or need, a new one. Think about cell phones. The world has moved to rental programs that allow us to get our cell phones fixed when broken, replaced when lost and upgraded as soon as a new one comes out, all for one low rental price. For businesses today, this is the gold rush — predictable demand.


Dealerships are no different than other businesses. Most are figuring out how to offer rental programs in a Software as a Service (SaaS) or Platform as a Service (PaaS) go-to-market strategy. Those who haven’t entirely figured SaaS out have resorted to giving away hardware or creating lease vehicles that appear to be the same to business owners. Others have gone to bundling credit card processing with POS and claiming that savings on one pays for or discounts the other. But what does the marketplace really want? For that, I go back to cell phones. Consumers will pay regular cable, phone, gasoline and coffee prices, but what about equipment, software and service being built into the same monthly price? Dealers should partner with companies that help them not take this piecemeal. At the same time, Dealers should avoid partnering with companies who give away items to get business. Otherwise, Dealers cannot make a living.


I walked away from a banking relationship recently where the bank wanted to give business owners the hardware and software for free, in return for keeping them as a customer on other financial services. The problem with this arrangement wasn’t that it couldn’t work for the bank; it’s that it leaves no money for the Dealer. You see, the Dealer can no longer charge fees on top of the rental price. Instead, they must have their fees covered within the monthly fee the business owner pays.


There lies the issue. Dealers need to stop trying to create their own bundles and spread themselves out financially, taking on all the risk. Modern Dealers can no longer afford to buy other Dealerships or build their own products. The modern Dealer needs to find a POS dealer program that has the resources to support the Dealer, and products that will sell, compete and solve your customers’ needs now and in the future. Why build a better mousetrap? Instead, find the best product and work like hell to create lifetime wealth for your Dealership. I believe we have built a program like this for Dealers at Heartland, but I also know there are many other great programs out there.


Society loves to tell us that we’ve reached a retail apocalypse. That brick-and-mortar stores and Dealers are dead. But each of these claims has been, and continues to be, rebuffed. For example, I will use Microsoft Resellers. I remember when this involved selling disks, but today, the consultative meaning of a Microsoft VAR is much different. It also remains a multi-billion dollar business worldwide. So don’t believe what people tell you. Write the pages of your Dealership’s story and see what a modern reseller program has to offer you. When you do, be sure to do thorough research to avoid swinging your business from one bad program to another.

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