For Pro Sales Excellence, Get the Basics

Kenneth Wilbanks

July 2006

Working with home channel organizations who seek improvements in all areas of operations inevitably leads to focus working with professional customer sales teams. These teams are typically truly desirous of personal success and the success of the customers. The owners and managers at the helms of these companies are amazingly talented and driven individuals. They have led their organizations to a plateau of achievement. Now they REALLY want to experience a swell of new sales and profits originating from their pro customer segment. I approach all projects in excellence, including initiatives in sales refinement, with the following rule: Once the basics are intact, then you get to build upon that foundation with any number of unique initiatives. If the basics are not intact, new initiatives will fail. Basics come first.

Be In-Stock.

I bring this point to print yet again because many dealers simply don’t want to face the fact that this fundament of their business is pitifully under developed. I see this regularly in my work with dealers of all sizes. Multiple branch organizations fail to maintain sufficient quantities of product in each location to fill orders required to maintain pro business, let alone expand it. These same organizations dismiss this fact with a practiced excuse, “it’s in the system.” So what. That is like saying, “we’ve got the eggs needed for the omelet, but they’re still inside the chicken.” Our smaller regional dealers have had the seeming luxury of maintaining low to zero stock, possible only because the next dealer down the road is in the same situation, so the customer can’t experience better business preparedness elsewhere anyway. That attitude is just not gonna cut it anymore, especially with well heeled national leaders expanding across the country with plenty of stock on hand right now to fill any order at all. Smaller dealers are rightfully concerned with this current wave of consolidation. What to do? Get in stock now, beginning with an internal organizational mandate that it IS NOT OKAY to be out of key products. You must stock enough products for current sales as well as for any expansion in sales. As leaders, we under stock in our companies and dismiss it way too easily, yet as consumers we don’t tolerate low or zero stock from any other business whether groceries or shoes. If we as smaller dealers try to run multiple locations but lack capital to be fully stocked in each of them, wouldn’t we be better off reducing the number of locations to do a better job in the ones that remain? Many partially developed business operations in many markets will never amount to a strong company of fully functioning branches in fewer markets. But that’s another article.

Problem with turns? Inadequate turns come from under-refined product mix, under-developed special order business, and under-directed sales staff. You won’t solve problems with inventory turns by running short on key products. Skimping on inventory limits capacity for growth. Without increased capacity, you have no wiggle room. You over tax your organization and perpetrate chaos with customers and employees. I often say, no stress: no diamonds, but this kind of stress just gets you coal dust.

A couple of dealers in my client base are working on pro sales refinement. Owners often wonder why they don’t get a shot at bigger projects in their market. As we know, pro customers want what they want, in the quantities that they need, NOW. After hearing my clients say one more time, “it’s not on the shelf, but it’s in the system,” I directed them to track for a while the number of miles driven between branches to fill orders. Shocking fact: Seventy percent of those miles driven by the delivery fleet were NOT on the road to the customer, but from branch to branch gathering up enough product to fill the orders. With diesel at three bucks a gallon, who in the heck can afford that! Such a dismal use of resources, equipment, and manpower, severely damages pro customer confidence in the dealer. What is the number one response from the customer base in a needs analysis survey? These existing pro customers do not do more business with the company because “they can’t handle the business I am giving them now. How would they possibly handle any more business?” Indeed.

Have Sufficient Measurements.

As with any game, you gotta keep score. You also have to record and analyze the details of your game that lead to the end score. Often large organizations have a profit loss statement, but spend no time reviewing and strategizing from even this boldest and most comprehensive scoreboard (some organizations do not even have a profit loss statement). But the P&L is not really the scoreboard for pro sales refinement. What IS important is an adequate set of merchandise statistics with enough detail to know what is happening with your core product categories. Further, you need to be able to slice these statistics By Salesperson and By Specific Customer. By Salesperson indicates how an individual sells through all product categories, especially into more profitable product groups; By Customer indicates real-time selling opportunity to the ones who’ve “got the money.”

I reviewed an organization where with one look at this info, we discovered that not a single pro customer sales person was selling squat for fasteners. That’s right. Selling lumber but no nails and no joist hangers. None. Each and every pro customer sales person assumed that the customers were picking up these products from the store counter. Well, yes they were, but more often from the competitor’s counter down the road. P&L statements told us that we had a gross margin problem. Merchandising statistics By Salesperson and By Customer told us where and why we had a gross margin problem. By the way, we asked the customers directly and they confirmed our findings. Then, knowing this, we could do something about it.

Form a Targeted Marketing Strategy.

Once you identify a weakness in selling, you can formulate a targeted marketing strategy comprised of three basic formats. One, very basic and very effective, is targeted marketing by product. Select a specific product, just one, and make a short list of how to sell more of this item. Remember the sales team failing to sell fasteners? That team was challenged to increase sales on a specific set of SKU’s for a determined period of time. A goal was set. An incentive was established to make it fun and the game was set into motion.
A second format of target marketing is by Customer Type. Say roofers. You see that you have very few pro roofers within your customer ranks so you ask yourself and your team: What do we need to do to recruit and retain more roofers in our customer base? Do we have the right brand of roofing? Do we have sufficient equipment and people to operate the equipment? Do we serve our professional roofing customers with the same intensity and devotion that we serve our general contractors? How do you answer these questions? Don’t guess at the answers. Ask. Go ask the customers.

Don’t assume that pricing is what matters most. I know beyond a shadow of a doubt that while price is important, it is not the most important thing. I have two clients in close markets who basically sell the same products purchased from the same suppliers to the same types of customers while one organization generates five points of margin MORE than the other. One company works daily on systems, customer support, and partnership with their customers. The other neglects systems, reacts only to customer complaints, and isolates itself from the customers. I bet you can say without mystery which dealer has the higher gross margin.

The two targeted marketing formats I recommend focus energies so that success is ensured as long as someone constantly champions the game. The third format of targeted marketing by geographic area is very commonly done in our industry but achievement is usually slow to come. Basically, you say that you want to sell some kind of stuff to some kind of customer within a general market area. That plan lacks real focus for my taste, however we develop some geographical marketing strategy: Dealers in small towns ought to hold to a paradigm that NO dealer from a neighboring city will be the dominant dealer in our town. Own your own turf. Now that’s a bold statement that gets me excited. Geographic dominance is fully realized through excellence in the other marketing strategies, by customer type, and by specific product.

Establish a Delivery Policy and System.

Delivery service is where the rubber meets the road with pro customers. I don’t care how many trips can be earned through volume incentives. I don’t care how many golf outings are held each year. I don’t care how much you discount products to have the best price in town. If you fail to execute an amazing delivery service with stellar efficiencies, immaculate accuracy, and the ability to be on time every time, then you will fail as a pro dealer. You fail as your delivery teams suffer stress from disorganization and exhaustion from making up for inefficiency through overtime. You fail as your sales people doubt your ability to deliver what they promise in the sale to the customer. You fail as your customers doubt your ability to serve their accounts. I see this every day, dealers struggling with no system for reliable delivery, with no simple rules on engagement between sales and delivery teams, with sales people who get the deliveries to their customers by force of personality (by acting mean as hell to the delivery team).

Your yard-staffing plan must incorporate two separate teams, the delivery team and the yard service team. That may sound simple. It is simple. The delivery team has two groups, load builders who build loads and drivers who drive the trucks. A separate group handles the pick-up customers in yards and warehouses. That’s the basic structure. Drivers drive. Load pullers pull loads. Yard service staff takes care of customer pick-ups. When you mix the manpower and equipment resources between yard/warehouse service and load-building/drivers you are stuck in a structure bound to fail. Urgency of delivery opts out over importance of customer service, but urgency bounces back and forth from customer pick-up to offsite delivery. The need to get loads out means pathetic yard service. The need to serve pick-up customers means loads are inaccurate and deliveries run late and we hurry and hurry faster and faster to make up for lost time. No technique, plenty of force. Finally our delivery fails and we collapse from disorder and exhaustion.

As a lifelong athlete and martial artist I can say through experience that one of the most difficult principles to master in any contest is that you gain power through technique. There are limits to the speed of the human body. There are limits to the strength of the human body. Therefore, you gain time by moving sooner NOT faster. You reduce risk by reducing distraction. Imagine a baseball team with everyone on first base and making up the rest of the play as they go. Ugly, but that is just how tons of dealers operate and wonder all the while why their yard service stinks and why they can’t cleanly execute delivery to save their souls. That is what we create if we do not separate delivery teams from yard service.

I remember that my amazing grandfather could achieve more in any week than anyone I have ever known and never EVER be in a hurry. He was always relaxed and smiling and rarely stressed. He was a lumberman too. A premier woodpecker facing all the challenges we all face every day. He just never let himself or his team get behind. He got as much of tomorrow’s work done today, every day. From this devotion to proactive operations, his team simply always had extra time. Never rushed and never stumbling over avoidable distractions, they were not only relaxed, but also accurate in their work. We can all learn form this example. Be sure that you get all orders for tomorrow pulled, staged, checked, and first out loads on the trucks today. Fail to do this and your organization will suffer inefficiency, inaccuracy, and sinking morale while working longer, harder, and faster, getting further behind with each passing day.

Externally you must reach out to your customers, enrolling them in their portion of the success model. Establish last call times for orders for the following day so that loads can be prepared in advance. Set up rules for product pickup so that there are no surprises at the jobsite that take up time without a plan.

Have fun.

We need to celebrate more when we score. Sometimes I see the face of our industry, and it is a solemn face. In our stoic pursuit of the daily business we fail to celebrate with good cheer the required bravado that sets the soul on fire for a cause. Any cause including something as simple as selling more nails.

Champion your initiatives following the model of a team. Teams have a well-designed game with rules, scoreboards, penalties, and trophies for the winners. Teams have strategies for their play. Teams also have coaches who observe and routinely correct bad play, during practice and during the game. Teams have cheerleaders with untiring optimism and unflagging support who remind the players that winning requires enthusiasm and discipline. In the materials industry we too often omit the cheerleader. Time and time again clients admit that they as owners and managers have no practice of commending people for a job well done. Our industry leaders KNOW that they do a poor job of recognition and commendation. We also know we have a critical issue with recruitment and retention of quality staff in our industry. Studies for recruiting and retaining quality staff show that one of the top requirements for attracting top quality employees is satisfaction of the inherent need for recognition. Talented potential employees state plainly that they will only consider careers with organizations and industry leaders who routinely and constantly recognize achievements and openly thank players for individual contributions to the organizational success. It seems that we as leaders admit that the critters are leaving the farm yet we are the ones who are failing to mend the fences when it comes to acknowledgement and recognition of our employees. We gotta learn to have fun, celebrate openly team and individual successes and say THANKS for a job well done. How often? How often do you need food and water? Every day. Our bodies need nourishment every day. So does our attitude. Every day.

You want a high achieving pro sales team? Get in stock and stay in stock; Build detailed and accurate scoreboards; Establish excellence in delivery and maintain that practice with discipline in execution; Develop target market strategies that focus on specifics. Finally reward the results. Tell people when they have done a great job. Have fun! Even if we’re at the top of our game, if we don’t have fun, the top players leave the team, the team won’t play, end of game, and we’ll be wondering whether it was lonelier at the top or whether it’s lonelier being out of the game entirely.