Editor’s Note: The following is the second part in a series of Veterinary Advantage articles on selling capital equipment (the first is available in the latest digital supplement online at www.vet-advantage.com). Look for upcoming articles highlighting the different segments of capital equipment, as well as tips on starter questions with clients, financial and tax incentives clients could receive, and tips on how to close the sales.

What if a single question could lead to $100,000 in sales? Not just a one-time deal, but reoccurring orders? A new pipeline for your company and a new way to increase revenue? The promise of long-term relationships, because your customers would need you for the long haul?

“It all starts with a simple question like ‘Are you planning on building or renovating your practice in the next 18 to 24 months?’” says Bill Hogan, director of sales, Midmark Veterinary.
“The answer [your customers give] may surprise you,” he says.

Value for you, value for me
Many veterinary hospitals are looking to build, expand or just in general find ways to increase revenue. The purchase of new equipment can meet those needs. However, many distributor reps haven’t initiated the conversation, because asking customers about capital equipment often means getting out of a comfort zone. It’s less order taking and more consultation, says Gary Eaton, director – sales channels, IDEXX Laboratories. When pitching products to customers, Eaton says reps should consider what needs they are fulfilling, such as customer service, patient care, and the hospital’s financial bottom line.

“Equipment, instruments, and other capital purchases are vital to these three aspects of all veterinary hospitals,” says Eaton. “So if a rep does not sell equipment, he or she has limited the value they can create and bring to their customers.”

Take, for instance, lab work. A veterinary hospital could be losing valuable time and revenue if it outsources blood chemistry, hematology and immunoassay results it could do in-house with an analyzer. With in-house equipment, “the veterinarian gets test results while the clients are still in the clinic,” says Eaton. “This enables the veterinarian to make the diagnosis, then recommend and begin treatment. Or he or she can use real time test results to reinforce ‘good behavior’ from the pet owners – such as compliance with tick and heartworm prevention – then sell prevention products during the visit.”
Hogan says equipment sales offer reps an opportunity to differentiate themselves. “Today’s sales representative is faced with increasing pressure from the buyer who has devalued the role of the distributor representative by commoditizing the traditional products they offer,” he says. “Capital equipment, in many cases, opens the door for the distributor representative to sell solutions to a more complex, longer sales cycle opportunity. The distributor representative has a real opportunity to build a relationship with the customer, something they don’t always get the chance to do when selling consumable products that are often reduced to the lowest common denominator – price.”
“Choosing the right equipment is vital to a clinic’s success,” continues Hogan. “In many cases that equipment will last the life of the practice. The distributor representative plays an important role in helping the clinic identify the need, demonstrating how the equipment can help them realize a return on their investment, identify the appropriate equipment, and most of all demonstrate how the equipment will improve the quality of care for the clinic’s patients.”

Once an equipment order has been made, there’s often a door open for more sales opportunities, including consumables. “Equipment sales that meet real needs are always going to open up additional sales opportunities,” says Eaton. “Equipment that solves a problem, improves the bottom line, or increases the standard of care in the hospital is what builds your reputation and your value to the practice. Adding value over time is what continues to give you access to the clinic and its buying decisions for all products.”

Obstacles
So if equipment sales have the potential to lead to such profit windfalls, what’s holding some sales reps back? Hogan says selling equipment often means committing to a longer sales cycle.

“Capital equipment is a small percentage of [a sales rep’s] overall sales,” he says. “In many cases the sales cycle is longer, it can mean multiple meetings with the customer and that can be a drain on the limited time a distributor representative has in a day or week. However, if the distributor representative has a good working relationship with their capital equipment territory representative they can work together as a team to provide added value, secure the sale, and the development of a long-term relationship with that clinic. It truly is a win-win situation.”

Eaton says the biggest obstacles sales reps face with equipment sales aren’t unique to that particular segment. It comes down to having enough knowledge of how the equipment is used, best practices and then having “excellent questioning skills to uncover unmet and unrealized needs,” Eaton says. “A rep also needs to make a significant investment of their own time doing the upfront homework in the equipment category so that they are an expert on their portfolio and can help the veterinarian acquire the best solution. Reps especially need to know about the service and support record of the manufacturer standing behind the product. They are selling the company every bit as much as they are selling a product.”

And overall, they’re selling value, says Eaton. “Equipment that solves a problem, improves the bottom line, or increases the standard of care in the hospital is what builds your reputation and your value to the practice,” he says. “Adding value over time is what continues to give you access to the clinic and its buying decisions for all products.”

By Graham Garrison