Successful sales: Why focus on sales?
What is the next big area of the wholesale growing businessthat, when improved, will increase profit?
You meet all of the discounted early-order deadlines. All ofyour available space, and then some, is full of product as often as possible.You have already made significant strides into improving productionefficiencies. You may have even taken in all the “big automationgains.” You’ve “done it all,” and now the laws of diminishingreturns are stifling every additional move you can think of.
What about sales? Have you considered that maybe the solutionto your shrinking profits is not to save more money but to make more money?Sounds too simple to be true, but it is — and not by adding more sales peopleor using gimmicks. An “investment” in your sales approach could yieldmore profit dollars than wringing out the few pennies left in productionprocess inefficiencies.
For example, how many times in the past three years haveyour vendors asked for price reductions? Five percent one year, an additionalfive the next. And you absorbed the reduction because you felt unsure aboutyour relationship. Consider the following chart. The far left column representsa possible range of your current gross margin. Each successive column shows howmuch more product you would have to grow and sell just to retain the samenumber of profit dollars. It’s an uphill battle for profit in the face of pricereductions.
If your gross margin is in the 30 percent range and you areasked to lower your price by 10 percent to capture an order or retain thebusiness, did you realize how much additional product you have to produce andsell at that price to have the same profit? You would have to sell anadditional 35 percent of product at that price just to make the same profitthat you made at the original price.
So what do you do?
* Find some way of improving efficiencies by five, 10 or 15percent?
* Produce more to keep from losing ground in year-end profitdollars?
* Increase your chances of controlling this front-endsituation through sales process improvements?
The choice should be very clear.
How can sales help?
Forget the stereotypes of salespeople and of greenhouse”farmers.” All successful companies have professional people whosesole function it is to work closely with the customers, to provide solutions,to nurture the relationship, to anticipate problems and, yes, to capture newopportunities. These people are salespeople, and they are just as important toa small- to mid-sized greenhouse as they are to a Coke or a Boston Scientific.
This series of articles was developed to provide insightinto the power of relationships, providing solutions, effectively presentingthe value of your entire program and the sales that result. But before you canachieve any of these, you have to develop your sales approach, and that is whateach of these articles will help you do.
Each article in the series will focus on a single aspect ofthe sales process, seven in all. Real-life sales examples, provided by growers,will be provided to illustrate how others have successfully implemented aspectsof this process to solve problems and secure agreements. Á
Increasing your effectiveness in selling procedures can havesurprising effects in the profitability of your business: Overall salesincreases and growth of your business, increased sales of higher-profitproducts, new customers and getting paid for the value-added services youprobably already provide.
The Seven Steps
As mentioned, there will be eight articles in the series,including this introductory piece. Perhaps you simply need to add one of thesteps to an existing method; perhaps you need a whole new system; perhaps youjust need to be reminded about the sales principles you already know.Regardless, these seven steps can help. We have conducted numerous seminarsabout these seven steps and know the difference they can make in organizations.
Below is an outline of what will be presented over thecourse of the series. If you have any questions, feedback or commentary, feelfree to call or write. We love questions.
Step 1: Planning tosucceed by achieving a commitment. Ever get caught unprepared? What do you saywhen the client asks: “What do you have that’s new and interesting?”or “How will your products help me be more successful at the retaillevel?” or “You will need to match this price.” This first stephelps you prepare for these dreaded, inevitable scenarios by giving youexamples on how to best answer these key customer questions and demands withoutlosing margin.
Step 2: Relationshipdevelopment. Can you gather profitable orders on the phone from someone youhardly know? How do you get to know customers better without having to visiteach one? Who should you visit? The easiest, most consistent sales are madebecause of relationships; the key to this step is knowing how, when and withwhom.
Step 3: The art ofasking good questions. If you don’t know what is important to your customer,will he buy from a competitor who works hard at understanding his concerns? Youbet. While questions are part of building the relationship in step two, thisstep goes beyond the building stage into understanding your position. Questionshelp you retain preferred provider status as your clients’ needs change.
Step 4: Identifyingthe need. You have become successful as a grower by being better than your competitorsat certain things. How do you match these business strengths with the needs ofyour retail customers? How do you even know what the needs of your retailcustomers are? If you are not providing what they need, you will not make thesale.
Step 5: Presentingyour company and products. How good are you at communicating your excitementfor the products and strengths of your program? If you don’t help the customerunderstand how your pansies are better for him, that your company listens andresponds and that you are committed to their success, it’s just a matter ofprice.
Step 6: Achievingthe commitment. Do you sometimes walk away from a client without a clearunderstanding of what the buyer agreed to? How often are you told to phone backwhile the client “thinks it over”? Step six highlights the importanceof firm, on-the-spot commitments and outlines some strategies for getting them.
Step 7: Review andplanning the next step. Do you leave the client with just a handshake and athank you or do you confirm a next step? Defining the process ensures thateveryone is on the same proverbial page and erects barriers against yourcompetitors. Do you always leave your customer understanding the value of whatwill be covered in the next meeting?