by Robert Conti
Sales managers for distribution companies constantly face multiple challenges such as solving customer problems, working with vendors, achieving goals set by senior leadership and managing their sales team. One area where sales managers can have a significant impact is spending time with their sales team to help them meet sales and gross margin goals. What do most successful managers do to help their sales team prosper in those areas? After working with more than 100 distribution sales teams, the keys to success can be boiled down to these five principles.
This principle is more than simply stating “Grow your business by X% over last year” or “Increase your gross margins by X%.” Managers must provide clear direction so that their sales reps know precisely where to focus their attention. For example, “Increase the sales of safety products in your hospital accounts.” (In this example, the specificity of product type as well as market segment provides clear direction for the sales rep.)
You must utilize a measurement system that tracks the performance of each goal and objective. The goals you set must be detailed (as mentioned in the first principle) so the tool you choose for measurement must be equally detailed in reporting ability. If your goal is to “sell three new products to Customer X,” then the tool should be able to distinguish between new and existing product sales within a customer.
This means going on sales calls with your reps and showing them how to identify sales opportunities, solve customer problems, set and negotiate product pricing and deal with objections. When going on calls with a rep, you should know the customer’s order history, the pricing given to that customer, any rebates or special terms for the client, among other things. Be prepared to share with the customer the range of products that your company typically sells to similar customers. As the manager, take this opportunity to educate the customer how your company can help them be more successful by sharing success stories from other similar organizations. For example, “Our work with other manufacturing companies has shown us that by changing the reorder cycle of XYZ product from two weeks to four weeks of inventory can reduce your overall cost and machine down time by 15 percent.”
Set intermediate goals to demonstrate a pathway to success for your annual goals. Do not wait until the end of the year or end of the month to measure your performance. Track your progress on a daily basis. Managers should provide easy-to-use tools, including charts and graphs to show the progress towards the reps’ final objective.
Make sure that sales compensation and sales recognition programs are directly linked to the objectives set for your reps. For example, it does no good to have a volume-based contest within a product category if one of the goals is to raise gross margin in that product category.
Successful managers consider themselves teachers and coaches. Their objective is to show their reps how to become successful sales professionals. It is much easier to determine what to show a rookie sales rep, due to their lack of sales experience. However, coaching should not be eliminated just because the rep has experience. A rep with 20 years of sales experience still needs encouragement, reinforcement and can always learn something new. By creating a learning environment that holds everyone accountable for results, you can drive significant improvement in top-line and bottom-line business results.
Robert Conti is the president of SalesApex. He can be reached at firstname.lastname@example.org.