Matt Sledge makes arrangements for the silent auction on July 30 in LaVergne, Tenn.
If you were at the 2008 ISN Tool Expo in June and attended the distributor panel, then you already know a little about Matt Sledge, an independent mobile tool dealer from Murfreesboro, Tenn. Matt was the youngest distributor on that panel, had plenty to say and plenty of energy for the early hour of the Saturday panel discussion.
On his daily route, that same energy continues to bubble over when he’s selling to customers. Matt has been a distributor for about seven years, five with one of the brands and now nearly two years on his own.
Well, not really on his own. Whereas many distributors have help from their families from washing the truck to inventory, billing and more, Matt’s wife, Shannon, will actually drive his truck and do his route on days that he is unable to, whether sick, at a tool show, etc.
“I just pull up, and honk the horn,” Shannon said. “I come in like, ‘Toolman’s here!’ They say, ‘Yeah, you’re a lot better looking than the toolman.’ ”
Shannon admits, though, that she concentrates much more on collecting than selling when she’s on the truck.
“I sell, but he’s a better salesman,” Shannon said. “I’m always hardcore [collecting]. I mean, when a guy says, ‘I don’t have any money,’ I say, ‘Are you really going to tell a woman that you don’t have any money?’ ”
Shannon has even done Matt’s route for a full week. A self-described “motorcycle nut” (he previously worked in a motorcycle dealership on the tech, parts and sales sides), he went to Daytona Bike Week in two of his early mobile years, and Shannon ran the route each time.
“The thing about this business, if you don’t run it, nobody’s going to,” Matt said of how lucky he feels to have Shannon helping out. “She’ll run it, maybe five days out of the whole year.”
One of Matt’s keys is consistency, as with any successful distributor, and that’s a big part of the help Shannon offers — being consistent.
“It means something to the guys,” Matt said. “You show up at the same place at the same time on the same day. They’re going to buy from you, because they know you’re going to be there.”
Matt still uses some of the techniques he learned as a branded dealer, saying the “training time” of being with a brand helped, but wasn’t essential. He does feel that a sales background can help more than a tech background on the truck.
“I think I could’ve come out the door and did it straight as an independent, but I don’t think it’s for everybody,” Matt said. He recommends all mobile tool dealers take some sales classes or seminars every year to continue advancing their businesses.
“I said this in the small group at the ISN show, that if any of the guys out there have the opportunity to take a sales class in their business, take as many as you can, because that stuff really does work,” Matt said.
“Sales is a psychological business.”
Matt runs several contests to keep customers interested. Past events have included raffles and T-shirt giveaways. One recent promotion involved a toolbox giveaway.
“I’ve already made my money on the deal,” Matt said of taking the used toolbox in on a trade. He wasn’t keen on the idea of selling it to somebody and taking two years at $40 a week to be paid off.
“I brainstormed with Joe Knight, my ISN salesman,” Matt said. “I decided I’d just as soon sell 160-180 items that have a $25 markup on them.” Anyone who bought one of the three under-$100 items, an EZ Red clip light, GearWrench four-piece extended screwdriver set, or a 42-piece screwdriver set, received a raffle ticket for the toolbox.
“These things are flying off the shelf. I’m selling two or three items per stop, everywhere I go,” Matt said.
But Matt doesn’t keep contests going all the time.
“They stop hearing the pitch, and it takes [time] for me to run a cycle on something, and actually get paid back what I’ve invested,” he said. The money comes right back for those who pay in full immediately.
“But then, somebody’s going to put it on their account that already owes $300, and it’s going to take a little while for that [money] to come back in.”
Matt buys the majority of his tools through ISN, and some from Medco. He touts his relationship with salesperson Knight at ISN as key.
“The reason I do business with ISN is because of the relationship I have with the one salesperson,” Matt said. “I talk to this guy, all day, every day.”
Last year, Matt’s tool sales were near $375,000, about $75,000 more per year than before he went independent. He does admit that before going independent, he was already selling a lot of competing brands.
“My last year … I realized I was making more money selling independent then selling the [branded] stuff.
“And I’m not interested in working for anybody. That’s the reason I got out of that, I wanted to be all driven by myself. … the direction, it’s different,” Matt said.
Being the main driver, and the lone employee, in his business is what attracted Matt to the tool business to begin with. After saving investment money, he started looking into different franchise opportunities.
“I was looking to buy an oil change place, looked into buying a Subway franchise. And all these things with employees started hitting my head. If you’ve got an oil change place, you’ve got $7-an-hour guys working for you, so they’re going to make a mistake, which is going to cost you money in the long run. Subway, you’ve got all this food stuff going on.
“I started looking for a business that I could buy, that would pretty much run on just me. A guy that bought a motorcycle from me, came in and said, ‘Man, you need to get into the tool business.’ ”
After about three months, “I drove to Alabama to look at my first tool truck. When I saw it, I was like, ‘That’s me. I gotta do it.’ ”
He paid off his truck in less than two years and was solid with his tool account within a year. One thing Matt does not like is debt.
“I don’t think it takes a $100,000 tool truck to make $400,000 a year,” Matt said. “I know a guy who spent $115,000 on a tool truck. That depreciates. I can buy a house for $130,000 that goes [up].
“I paid $20,000 for this truck,” Matt said of his second truck since coming into the business.
When it comes to filling his truck, he likes to keep it full, packed, with tools, even at the expense of the space required for toolboxes.
“I hate toolboxes … tying somebody’s money up and then it takes them so long to pay for it,” said Matt. “If I could fill my truck up with nothing but shelves, I’d rather just sell tools.
“But I kind of have to do the whole toolbox thing,” Matt said, which is in fairness to his customers that look to him for a choice beyond the franchise brands’ boxes.
“I do have good customers that want toolboxes, and I do have good customers that are going to pay for them. I don’t need to cut them short of not having that service,” Matt said. “And I have done pretty well with Mountain and their toolboxes.”
As far as actual tools go, Matt looks to order the same amount as he sells each week. Because space gets tight in an 18’ truck, he keeps some overflow tools at home, and more at a customer’s shop.
“Between my home and that shop, I’m only about 10 miles away from replacing anything I might need at any time,” Matt said.
Even though everything else is going well, there is one main downside to the business for Matt.
“The only thing that would ever drive me away from the tool business is the collections. … I guess it’s the let-down of thinking that you’ve got a good relationship established with somebody, and them not following through with what they said they were going to do.
“I follow through with what I’m going to do,” Matt said. “That’s the hard part about it.” Some of it is skips, though not all of it.
“I sold somebody an air ratchet one week, and the next week the guy got fired. … He lived in ‘Hole-in-the-wall’ Tennessee.
“I jumped on my motorcycle, drove to his house, and picked it up.
“District managers will tell you to blow it off and go sell something else. I don’t blow it off, I take it pretty personally.”
Beyond skips, Matt wants his customers to be up-front with him.
“People that don’t pay me on a week-to-week basis with problems, that just kind of rolls off my shoulders.
“It’s the people that owe me $300, $400, $500” and won’t pay anything and duck around that get to him.
“I try to shoot a $20 bill for every $100 I sell … but I’m not real, real picky, and I think that’s why I get a lot of guys’ business. I ask for the bare minimum, 10 percent, every week. If you can’t pay me 10 percent, I don’t want to do business with you.
“I try to get 20 percent, but bare minimum 10 percent,” Matt said. “And they all know that. I don’t get run over much on my collections. I’m pretty known for going after them.”
Matt has about 325 active customers every week and shoots for $1,000 in collections and sales each day to be in his “comfort zone.”
“Cash is getting scarce. If someone’s not taking credit cards, they’re losing.”
Matt runs credit cards for his customers at the same time each week so they know when to plan for it.
“I usually cash a lot of checks on Fridays, and take a little extra cash,” Matt said. “If their check is $258 and some change, I’ll usually keep the $58, $48, whatever it is … as their payment.”
It’s the basics that keep Matt’s business running strong.
“Hit the store on time, be there every week, collect on your payments like you’re supposed to and treat the guy like you want to be treated, and you’re going to have a successful business. … A lot of the stories are similar, but it’s the small quirks” that set each distributor apart, he said.