by Art Waskey | May 24, 2022 | Art of Sales Weekly, Featured
A punch-card solution
I have seen how digitalization has transformed society through my long and fulfilling career. I still have my first calling card that bears the title, “Sales Engineer, North Texas, Airco Welding Products.” In that position, I called on distributors. Furthermore, as part of my training, I spent a couple of weeks in Airco’s customer service department in Houston. While there, I solved a problem the company was having with a computer routine on its IBM System/370. Having taken courses in programming Fortran for engineering applications just a year earlier, I was able to fix the issue. The punch-card solution worked like a charm; people viewed me as a computer genius. Thus began my interaction with the digital world.
Enterprise selling
Airco became BOC in 1978. After being promoted, I took a job in Texas, Oklahoma, and New Mexico. From there, I agreed to participate in the negotiations regarding an IBM minicomputer for one of our distributors. During that transaction, I learned about IBM’s sales cycle, “Enterprise Selling.” It involved getting the company’s CEO, key managers, administrators, and sales reps to agree to the purchase. I served as BOC’s representative in the transaction.
Linking to the outside world
My first computer was an Apple III, on which I saved documents on a floppy disk. I left this technology behind in 1984 when I joined the welding and gases distributor, General Air. We used a series of Macintosh computers and became connected to the world-wide-web in the ‘90s. I can still hear the squealing buzz of the dial-up internet connection that linked General Air’s first computer network to the outside world.
An online presence
The rush to establish an online presence followed. We developed websites with a collection of our products and services and began to use email. As broadband and Wi-Fi replaced dial-up connections, digital communications went into high gear. Our phones are a thousand times more powerful than our first clunky computers and storage in the Cloud.
Expand your relevance
Overall, the digital progression from floppy disks to smartphones is just one example of the scope of change we are experiencing. To make sure you grow with digitalization, get assistance from robust ERP and eCommerce consultants to expand your relevance in a rapidly changing marketplace.
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by Art Waskey | May 16, 2022 | Art of Sales Weekly, Featured
Focus on core strength
Independent distributors have been introducing Enterprise Resource Planning (ERP) platforms to their businesses over time. Further, many large distributors in this group now have robust websites and e-commerce platforms. However, smaller distributors are beginning to find favorable pricing from the growing number of eCommerce integrators at their disposal. The rise of Amazon Business, especially during the pandemic, has caused distributors to focus even more attention on digital sales techniques. The independent distributor, however, needs to be careful not to lose sight of its core strength — customer relationships. What differentiates independent distributors from alternate channels is their ability to win sales by building personal relationships with their customers.
Business is about relationships
Today’s automated eCommerce systems take care of many tasks previously handled by the sales team. When there is a sales problem or glitch, however, the internet connection proves to be a weak link. This is where relationships matter. Automation frees up time for territory sales managers and inside sales teams. Use it to build strong customer relationships that add value to your product and service offerings. Be in a position to offer a personalized solution when a client has a problem or question.
Mark Dancer writes: “The purpose of business is to help us live our lives and do our work in the digital age, as humans for humans”.
The future of distribution
Chester Collier shared these insights on the importance of relationships in a recent MDM podcast: “It doesn’t matter what you are selling, who your competition is or even the price. Business is about relationships, and when you understand this, you understand what needs to be done. Build a strong relationship with your customer and success WILL follow.”
Lastly, the future of independent distribution is being able to offer a relationship that works in collaboration with digital services and specific customer needs. Use your data to add value to relationships by customizing your offerings. This will differentiate you from competitors that can only offer simple, non-complex products.
By doing the right things, at the right time, for the right reasons, distributors will win through their relationships with their customers.
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by Art Waskey | May 5, 2022 | Art of Sales Weekly
A sales manager recently brought a problem to my attention. One of his customers had called and asked why he hadn’t been by to see him. The frustrated sales manager explained that the prospect had plenty of quotes from him but never purchased. He believed making further calls was a waste of his time. He asked for my advice. My response — look for the reason why your customer is unresponsive.
Build a relationship
I suggested he call the prospect and make an appointment to see him. During the meeting, he should allow 20 minutes of continued focused attention to build a relationship. Let the customer talk 80% of the time. Then ask the prospect why he hadn’t followed up on previous quotes.
Don’t assume
Too often we make assumptions about our clients. Instead of guessing, ask your customers about their actions, or lack thereof. Don’t assume that when an order isn’t placed, it’s because a final decision has been made not to purchase.
As a sales manager, I once instructed a rep to ask his customer why he hadn’t made the move to our company. The customer smiled, laughed, and said that he didn’t really have a good reason. This response indicates the relationship between the rep and the customer was weak. If the rep had invested time in building a relationship with the prospect a sale would have been more likely.
In another instance I learned a prospect was stalling on a sales decision because he did not have the time to spend with his purchasing department. When the sales rep offered to help with that transition, the business was secured.
Be proactive
Too often our assumptions about why customers hesitate are negative. Such thoughts are counterproductive and a drag on your daily activity. Successful business people are positive thinkers. Don’t let “head trash” prevent you from closing new business. Be proactive. Build relationships. Don’t be afraid to ask your unresponsive customers why they are not acting on your proposals. Be creative in leading them toward the deal.
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by Art Waskey | Apr 26, 2022 | Art of Sales Weekly, Featured
Price increase alert
The Producer Price Index (PPI) climbed 10% in 12 months through February 2022. In line with economists’ expectations, the Consumer Price Index (CPI) shot up 7.9% during that same period. Further, this represents the most significant year-on-year CPI increase since January 1982. In fact, with the CPI north of 6% for five straight months, distributors, like everyone else, are feeling the pinch on profit margins. Much less, to offset higher costs, many distributors and their suppliers announced multiple price increases in 2021. Thus, as inflation continues, these price adjustments need to continue in 2022. Charging for value-added services is an excellent way to accomplish this more palatable to your customers.
Value-added services strategy
Second, I find that most distributors believe their value-added services are essential to their competitive advantage. Yet most do not adequately monetize these services. You need to develop a reasonable strategy for charging for value-added services. Examine the services you provide, especially those customers won’t receive from digital online channels. Determine which of those services are revenue producers. Put a price on your value-added services and incentivize your sales team to pitch these services to customers.
Vet your services list
A typical list of value-added services includes repairs, technical support, customer training, engineering/design, on and off-hours delivery, loaner/rental equipment, installation, assembly, and stocking.
You can prioritize these services by gaining from these three attributes:
- How important is this service to customers?
- Are customers willing to pay for this service?
- How well do we perform (or could we perform) at delivering this service versus our competitors?
Price your services
A survey was conducted in 2020 by the Distribution Strategy Group, which found that two-thirds of respondents do not pay commissions for the sale of services. Moreover, with many distributors bundling value-added services into product prices, there is no way to pay commissions on services or incentivize their sales. Consider taking value-added services out of the bundle and charging for them. Your bottom line revenues will grow faster than you think.
Furthermore, if you are not already doing so, charge all non-contract customers for added-value services. Use this to offer reduced charges for signing new contracts or renewing existing contracts.
Offset rising costs
Finally, implement or raise your charges for value-added services to offset the revenue loss. For example, these services can differentiate you from your competitors, particularly those in digital channels. To maximize the value of added benefits you provide, it is essential to price them accordingly. Charging for value-added services is an excellent way to offset inflationary pressures in a manner that is more palatable to your customers.
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by Art Waskey | Apr 19, 2022 | Art of Sales Weekly
Digitalization has created significant changes in the space between salespeople and their clients. Sales process relationships were altered quickly during the pandemic. Thus, leaving little time for sales teams to adjust their strategies. Furthermore, to help you make the appropriate adjustments to your sales process, let’s examine the sales process relationships of today.
Critical sales processes
Outside sales – Enterprise Resource Planning (ERP) and eCommerce have automated many functions of the outside sales team. For example, salespeople once personally handled order taking, stock checking, chasing backorders, and pricing errors. Now, these tasks can all be done electronically. Today’s sales manager needs to adjust a way of creating relationships with customers. They can, share insights from suppliers, technology integrators, consultants, and other information providers.
Be sure to involve the principal decision-makers of your client’s operations, administration, finance, marketing, and sales departments. Today’s digital transformation (DX) and artificial intelligence (AI) provide important personalization. Herein, the act of tailoring an experience or communication based on information a company has learned about an individual. Also, use the data generated from current and previous interactions to create proposals specific to your customers’ needs. Doing so is an essential adjustment toward success.
Total sales process relationship
Lastly, distributors currently face various challenges, including a labor shortage. According to a survey of 50 industrial distributors, 63% are looking to add staff in 2022.
To offset the struggle of hiring, the distributor of this decade has the opportunity of changing the landscape by integrating simple sales process relationships.
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by Art Waskey | Apr 12, 2022 | Art of Sales Weekly, Featured
A mentor’s objective is to identify your needs and expectations and offer creative solutions that move your business forward. In today’s distribution business there are a growing number of experienced seniors. If you believe your team would benefit from a seasoned coach, consider enlisting a mentor.
5 Steps to Take
Executive mentors can help guide your business to growth. Here are some steps you can take with a coach.
Step 1: Understand the issues
A mind map should be created to summarize all the current growth issues. The goal of a mind map is to record key ideas and look for connections between them as projects. In many cases, unrecorded projects go unnoticed because they are never brought into focus. A mentor can guide you through the mapping process so that you do not waste precious time and energy.
In “The Seven Habits of Highly Effective People,” Stephen Covey suggests you can start the mapping process by putting first things first — his Habit #3. He recommends listing projects under two categories — Important and Urgent, and, Important but not Urgent.
Step 2: Prioritize the Projects
An experienced mentor can be invaluable for prioritizing and evaluating projects. Each week, they can ask your team to list, in order of urgency, the top five projects that need to be moved forward.
Step 3: Create Next Steps
Each Top 5 Project will likely require many actions. Use a mentor to help you plan each incremental step. Having seen/solved many issues before, your mentor can help you with the chronology of actionable steps.
Step 4: Implement Solutions
A mentor comes with a network of suppliers, equipment, and software providers he has engaged with in the past. Tapping into that network can help a distributor move more efficiently through project steps. For example, a distributor in the gas and welding industry may already have bulk CO2, and now wants to produce dry ice. If your mentor was once a manufacturer of dry ice, he will know several suppliers who can provide the best equipment, installation, and cost. This expedites your start-up.
Step 5: Track Completed Projects
There is no better motivation than visualization of past accomplishments. When a project is completed it should be dated and listed on a mind map. Moreover, I suggest recording them under the corporate divisions: Executive, Operations, Sales, and Administration.
Objectives achieved
Lastly, if you are a successful distributor on the move, but need help, consider enlisting a mentor. Tapping into a trusted source with years of experience, is one of the most effective ways to move a business forward. Mentors help you achieve your objectives efficiently.
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