Van interior upfits that boost residual value?

(upbeat music) So this podcast is about how to insult a journalist and then get more coverage. Welcome to the Fleet Lead. This Kevin Jones commercial vehicle editor at Endeavor Business Media and that our titles are Fleet Honor, Fleet Maintenance, Book Transporter and Trade of Bodybuilders. I'm here today with Brendan Scherke, who posted a picture of me for more truck weeks saying I'd asked a really stupid question. So I stalked him here to Cleveland at the end of the show. You didn't say that. What did you say? I thought it was a million dollar question, is what I called it. All right, so whatever. If I recall, as a guy who's covered heavy duty trucks for a long time, I didn't really appreciate that work trucks and vans have some residual value. I assume they got running the ground, but you said there's an ROI in taking care of them. How does legend and just the up-fitter vehicle, universal general, add to an ROI for a used truck or ban? Yeah, it's a really interesting question, and that's why, again, sorry for posting the photo, but glad to chat with you. That's why we're obviously having this chat in the first place is because that is an assumption of a lot of people, including Fleet Managers, is work trucks don't have any value at the end of their life, drive them into the ground. But I guess we have built a niche to prove that wrong. And I think what we've been able to find and help fleets with is that initial investment of things like wall liners, floors, et cetera, upfront, they're a little bit of an investment, but at the end of their fleet life, they pay massive dividends when it comes to reset value, because essentially when they pull out our liners or floors, et cetera, the vehicle looks brand new. And we have multiple examples of that. Yeah, Jerry, can you give us some details on this? Yeah, so I guess, I recently, I've actually worked with they updated all our products in their vehicle, and I asked them why, and he said, because these are assets that we actually own, and it's not like we're just renting them off someone and returning them, they actually own them, and they wanted it to be worth more at the end of its life cycle. And I mean, Legend has a great case study on our YouTube page, you can see it with U-Haul. U-Haul, every single vehicle they do, they put a rubber mat in the bottom of the vehicle when they pull it out, they put a new one in, and they get a much higher resale value for those vans. Yeah, and even just building on that study with U-Haul, their vans are obviously, their life cycles actually a lot shorter, but their vans are the most sought after vans, and a lot of America's plumbing companies start with U-Haul vans because of how well they take care of them, and we're very glad to be able to be part of that. Okay, well, also on your LinkedIn post, Brendan, you said something I absolutely agree with. When it comes to fleets, the answer to pretty much, every question is, it depends. What's the pushback you hear from people that you pitch? You say, hey, we've got these numbers that prove that this small investment pays off in the end. What's the resistance? Well, I guess what you started with a lot of times the fleet resist because, yes, they, oh, we just trash the vans, right? Oh, what's the point? But I think once they try it and they actually see that such a simple product can protect the vehicles even from wrap damage, that's huge. Your average wrap is what, $3,000 we have the amount of demo vans, that's like a lower cost wrap. They get upwards of $5,000 for a fleet wrap, and when that's dinged from the inside out, from tools, cargo, et cetera, that's very unprofessional. And that's just one of the things that we're able to help with. But to your point, I think it is very, very fleet specific. Jerry, I think you might have some numbers specifically about, I mean, because I've seen one of your posts on the legends of the road, legends, legends the road.com. What exactly are those numbers and how does that fit to somebody who may be skeptical? Yeah, so I mean, like Brendan just said, it always takes that conversation actually explaining what our liners actually do, other than he and noise reduction. And again, it's depending on what the fleet's doing. It's hard to put an actual number on that. But we've had multiple instances where it's coming out sort of around 750 more on the resale, increased resale on a used vehicle. And that's after a vehicle's been sort of on the road three to five years. And we've just done a case study at our headquarters where we took a van that had our product in for four years. And the interior was like brand new when we took it out. So on resale, I mean, would the original owner take out the legend product or any of these protection products to show a new truck or would they leave a man as that ad value? They would normally leave the man and that also would add value on the sale. Some would strip it out depending what's in them, some keep the shelving or something and they would strip it all out. And yeah, you have a newer interior. What we found in terms of percentage is a nice, clean van that is not dented or dinged from their asking auction houses, interviewing fleets, et cetera. They're able to get at least 10 to 35% higher resale value. And it just attracts better buyers. They're going to have confidence in a hay. If this van looks this good, the rest of the van must be treated, must have been treated well during its life cycle as well on the road. So this morning's OEM panel, everybody talked about the cost of vehicles is going up among other things for just how much petroleum products go into vehicles, et cetera. But someone mentioned that use vehicles now become more valuable. Do you see that in the market? I would have assumed it's kind of more complicated. Depends on the market. But I mean, can 10 fleets expect to get that value out even more when new vehicles are high? Yeah, 100%. And going back to that UHK study, it says right on there, a lot of the buyers for these vehicles are each fact companies and people just getting into the market. And these are clean, good vehicles still. And they get a way better price on them. And so we see that quite often, where, yeah, especially right now, maybe during COVID, some people overpurchased. And now they're wanting to get rid of them in this high demand for them. Do you think just back to the conversation about ROI and resale value along the journey? I think there's a lot of intangible benefits that fleets see. So going back to Jerry's example of the national fleet where they were claiming more in resale value, the other thing is they have competitors too. So it was a rental fleet in this case. But the customers that use these rental vans and don't have to feel like they're walking on egg shells when using these vans because they're loading a dresser in the back when they're moving. And it hits the wall. Well, it's hitting our wall panels. We're taking the hits. They have a much better experience. And then they're able to tell their friends about their experience with these vehicles. And it's the same goes for an operator. When the person doesn't have to think about working in the van, they're not slipping. They're not denting the walls, et cetera. They're having a better day. And then we've done our job. And that goes so much that shows up in the customer interactions. They're happier. And overall, it's a massive net value for the brand. Yeah, that makes complete sense. Putting that trailer bodybuilder's hat on. Where do distributors and upfitters fit into this? Can you speak got to broadly about how the business works for you and your competitors, even how you do this? And then since you've been kind enough to put up with me, what does the legend do differently or better anything you want to brag about? Yes, I guess distributors and upfitters come into this where they're fitting a vehicle. The more they actually offer their clients or a fleet manager up front to actually help them protect their investment, it really builds a good relationship with that distributor or upfitter and their end user. And they're going to keep coming back to them knowing that they've got their back. They're actually helping them protect the asset. They're buying and keeping their employees tapying and retaining them. Yeah, that's huge. And then just in terms of what we're able to do to help these fleets, where we a lot of times like to say, we're solving performance problems. So any product we come to market with, we're solving performance problems. Jerry lives and breathes this every day. So whether that be tool theft, whether that's asset protection, whether that is just an overall enhanced operator experience in the van every day, that's what we do and how we're different. And then I think just our capabilities have incredibly grown in the last couple years, even just with our expansion of supply chain. We've made a couple acquisitions and our capabilities are we're able to do a lot for customized options for fleets and and outfitters, OEM partners, vehicle manufacturers, custom vehicle manufacturers, et cetera. Exactly. What Brennan just said, we've coming out of COVID. We saw something key that we needed to do was own our own supply chain. And we really, I guess that's something you say want to brag about. We've really pushed owning our own supply chain. We've now got manufacturing in Chicago in Minneapolis. It's something that probably sets us apart. And in doing this is brought in a lot more capabilities, doing custom builds, custom colors, custom branding on fleet products. Yeah, really helped us solve a need for our customers. Well, the other thing, sorry, I was just going to say just before we go on this topic is the other thing we like to do, supply chain and products aside is we like to have fun with it. People maybe even yourself, you think vans are boring. They're just work trucks. They get run into the ground. We like to, I'm a marketer, but we like to make this, make the products and vans, make vans cool. That's something we love to do. And we're able to tell these stories of fleets and make a brand out of it. And that's something we're very proud of and have lots of plans for the future. Well, before I get back to my last supply chain question, Jerry, tell me real quickly what your conversations are like with Uppiders. How do you tell them what's the advantage of Legend? Yeah, so I'm in up. Fitter, obviously, I mean, there's so many different things you could go into here, but like you probably see a lot of our branding is the floor is the core, having a good foundation in a vehicle, that's where it starts. And actually building your van how the customer really wants it and ensuring that your customer has everything they need. A lot of what we would do going into a Fitter distributor is, obviously, explain why your products are, why we even do this and their benefits of each one. To not to drag in too much global geopolitics, but led to its headquarters in Ontario right and you do business in North America and Europe. Terror impacts, concerns, questions, problems, how you handling those. I can go first here. Like I already mentioned, it was owning our own supply chain was a big thing and our CEO was really pushed that down into the whole team to be proactive and as soon as the tear start coming up and like Brendan said, we made two acquisitions last year and just ensuring that we're ahead of the game and it's put us in a much better spot where exempt from all tariffs because of our products are now all made in the United States as a core raw material. Yeah, I think I don't have anything to add there other than we obviously saw the supply chain having some risks in the future. We saw that early on, the owner saw that early on and we're very thankful for that as a team and that's put us in a very good position. The other thing is we legend has the innate ability and the DNA to build stuff. We have a ton of ideas. We listen to the fleets, we listen to the outfitters and that's driven a lot of our product innovation, a lot of products that have started as a custom option turned into some of our best products. I think yeah, very proud of obviously our number one product being our floors and walls in the Vans, those are 100% made in the US. Well, building stuff is so cool and we're here in Ohio where there's still a lot of great manufacturing going on. It's fun to be around. But anyway guys, thanks for taking the time today. Any last thoughts or a million dollar questions that I haven't asked? I'll make sure to get another photo of you so I can do another post on this. Alright, very good. Thank you both so much. Britain, thanks for having us. Jerry, thank you. Thank you for listening to the Fleet Lead, produced by Endeavor Business Media, a division of Endeavor B2B. If you haven't already, please share the show with your colleagues and subscribe wherever you get your podcasts.