Customer-Centric Sales Force Reinvention
By Bruce Merrifield
In April 2015, Forrester Research estimated that one million B2B sales reps would no longer be needed by 2020 due to digital disruption. The firm solidified this forecast in a subsequent March 2017 report. The findings were perhaps hyped in order to sell reports, but they are still a helpful warning to undertake an actionable assessment of your sales team's readiness for cloud commerce in 2020 and beyond.
How? Consider viewing your sales team through the following analytical lenses to create questions for further investigation.
Six Analytical Lenses and Resulting Questions
1. Sort your salespeople into three groups: (A) Best; (B) OK; and (C) Wouldn’t-Hire-Again
2. For the C-reps, consider these questions:
- Why allow them to continue to call and underpenetrate their few, best-potential accounts?
- Why not outplace them and reassign the best accounts to A-reps? Likely, they will quickly win a bigger account share. If not, are they truly A’s?
3. What is the minimum annual gross margin dollar amount an account must yield to support a sales rep relationship?
The short answer is at least $4,000 in grotoss margin/year, assuming a net-profitable average order size. The longer answer (and more) can be found in my in-depth article, Downsizing, Upgrading, Re-focusing, Re-training and Re-Compensating (DURRR) Your Sales Force.
Questions you should consider asking include:
- How many too-small accounts have salespeople assigned to them? If they aren’t calling on them or making too few calls per year, then you don’t have a relationship.
- Do you have a small-account division opportunity?
4. Surveys of big buyers, conducted since 1990, consistently conclude that they view only 10 percent of salespeople are worth seeing.
Important questions to consider are:
- What is an A-rep?
- What do they do?
Compile a comprehensive definition of what an A-rep is and does, then get, grow, and/or reassign only the best to the biggest accounts.
5. Statistically, you probably have a few big accounts that are looking for (or are open to) co-creating a well-executed, win-win, integrated, sole supplier relationship. Digital sellers, such as Amazon, cannot sell, install, and maintain these replenishment systems.
So, here are your questions:
- How are you identifying these prospects?
- How are you upgrading your team’s system-selling skills and processes?
- Why are reps on commission selling these system solutions?
- If a rep is part of a team solution, what will be their role and compensation? Be customer-centric. Let the customer decide. Protect the best rep income losses if need be.
6. Other questions include:
- Do you have accounts buying commodities on a direct-ship basis that are 100 percent loyal to a rep who could switch the business to a competitor? If these accounts are net-profitable and credit worthy, then let things be.
7. And, the vision lens question to live into:
- Can your A-reps reinvent themselves to fit into the cloud commerce channels of 2021?
About the Author
Bruce Merrifield has been a consultant for independent distribution channels since 1980 and is a frequent speaker at trade association and large corporations. In 1999, he authored the book “Electronic Commerce for Distribution” and his writing can be found at www.merrifieldacts2.com.