Before buying anything for the company
By Jeff Winke
When making a decision to purchase any new product, it is imperative to do research and information gathering in order to ensure the right decision is being made. Yes, there is the upfront cost to consider, but the purchase will reverberate beyond that initial cost in terms of its expected productive impact on your business.
The question becomes what kind of research, soul searching, and analysis should be done before making the purchase decision to ensure the purchase will help your business grow?
“Research, compare, try!” stated Michael Blake, director of marketing, KM International, North Branch, Mich. “The more research you conduct, the better informed you become before making a buying decision. Don’t be afraid to ask questions regarding the proposed product or service you are considering purchasing. However, don’t get caught in the trap of over researching and postponing a buying decision, after all… the worst decision you can make is no decision at all.
“A lot of people will purchase a particular brand name or manufacturer that they want to work with. However, ALWAYS do research on other options out there, you don’t know if there is a better choice or cheaper price available elsewhere. If possible, always get a demonstration of the product in action as well. Often, seeing is believing and if you can see a product in action it will give you that much more confidence that you are buying the right product or service.”
Conducting thorough research is crucial, especially when adding a large machine to an equipment fleet.
“When purchasing equipment, a contractor needs to look at reviews online to make sure that the piece you are buying is well suited to your needs,” said Mark McLeod, president, Maintenance, Inc., Wooster, Ohio. “When buying a larger piece of iron, like a paver, you need to make sure that your transport equipment can haul it and your operator has the skills to successfully operate the machine.”
McLeod added, “Also, you need to make sure a new machine fits your company size as well as the price tag. Some people might think that buying a 1500-gallon sealcoat rig is a great upgrade, however if you do not have the work under contract to keep the rig busy, you may have just wasted your money. Consider if those big jobs could be done with your 550-gallon spray-rig, thus saving that investment. Make sure that the equipment fits your company’s expected needs. Some contractors have foresight and look to the future, but long-term upgrades are generally determined by their sales and operators capabilities, and their expense sheet.”
Underscoring what has been said, Curt Conrad, president and chief marketing officer, GIS Dynamics, Cincinnati, Ohio stated: “A buyer should examine the ways in which their business can improve before creating a purchase. By understanding where their business can improve, a buyer can better understand the benefits that a new software or machine purchase will bring to the company.”
A product manufacturer or technology developer can be a key ally in making the best decision when making a new investment for a paving contractor business.
“The manufacturers/developers are the ‘go-to experts’ for their respective products, so ask them as many questions as you can,” Blake said. “From my experience, sales reps in our industry are not stereotypic ‘used car salespeople.’ They actually care about the success and objectives of their prospective customers; so, they are, or at least should be, willing to offer advice, expertise, and knowledge to you to help you make a good choice.”
McLeod offered: “Manufacturers should be your partner when purchasing equipment or systems. They have the history and know the most recent updates of that piece of equipment. They can help you with new features and benefits of the unit as well as industry contractors who have purchased that piece of equipment and can give you needed insight before purchase. There really isn’t any hard schedule as all contractors have different applications and needs for the unit. Manufacturers are your friend when looking for good iron.”
To boil things down, what are the key considerations that go into a buying decision. Can they be reduced to a few items?
“In our experience, we see three key considerations when making a significant investment in your company’s business,” Conrad said:
1. “ROI: Determining whether the investment will help a company is likely the biggest concern in a purchase decision. ROI–return on investment–can be measured by an increase in won jobs, an increase in profits from existing customers, a decrease in time spent measuring and estimating sites, or even just an improvement in business processes.
2. How it will affect current business processes? Understanding how a new software or machine integrates with your existing processes is something to consider before purchasing. Will your company need to buy extra computers or tablets for virtual measuring? Will you need to dedicate time to train your estimators to measure virtually? How will the estimator role at your company change? Will you need additional or fewer estimators? How will the sales process change with virtual map take-offs? How will your crew utilize the sitemaps to improve their work on the job?
3. Evaluation of alternatives: How does one product stack up against another similar product? Thoroughly evaluating alternatives will allow a buyer to purchase the best product for the job. Look for testimonials or reviews by other buyers to see how the product helped – or failed to help – their company. Examine the type of support you can receive from the various product companies. Will you receive instantaneous support, or will you be stuck waiting for a huge, busy company to get back to you? Look for a product that is constantly improving, yet continues to offer the foundational aspects that your company needs to succeed.”
Blake offered the following considerations that paving contractors should consider:
1. “Price: If someone says price doesn’t influence their buying decision, they are lying. Cost is usually the single largest factor when making a buying decision. This doesn’t mean someone isn’t willing to spend a little more to get a better quality or a specific feature on a product/service however price is always in the back of a buyer’s mind.
2. Integration: This is geared towards the software side, but whenever you are introducing a new product or system into your company there will be some difficulties trying to integrate it into your current processes. I would always suggest having an action plan to create as seamless a transition as possible.
3. Buyer’s Remorse: Don’t settle for a product because it is cheaper in price or more readily available. If you have a specific product in mind that you are certain is the best for the business, do not settle for anything less. This holds especially true for larger ticket items, where the buying cycle is typically longer.
What it all boils down to is that everyone needs to perform due diligence in making a decision to purchase any new product, considered an investment in their asphalt paving business. Again, the purchases made, if done wisely, can have positive impact for years to come.
To summarize… do due diligence before making purchases that are intended to successfully benefit the company.
Jeff Winke is a business and construction writer based in Milwaukee, Wisconsin. He can be reached through email@example.com