I took a position as a UK sales manager for a large international hardware company with an exclusive area to manage. I was 27 years old, the person I replaced had been head hunted by a competitor company.
On my arrival I was told this man had the biggest area and that he was the best salesman the company had. I was under immediate pressure to perform; but I was not a person to shy away from a challenge.
Drawing on my previous experiences, I had to come up with a growth strategy plan quickly to outperform this best salesman. The first thing I did was to ask for a list of all my customers. I got a full spread sheet provided, there were hundreds of customers on it.
I then asked for a list of customers who had made an order within 6 months prior. I requested another list of all customers who hadn’t spent. The final list I requested was a list of all products we supplied with stock available together with cost prices.
The first week of my role was to plan my strategy and on week 2 to execute the plan. By the time day 3 came, my boss called me into his office. He said you know that you have a task on your hands, I replied yes, I do.
Why are you not on the road drumming up business he said? I stated that I was putting my strategy plan together and by week 2 I would be on the road. I gave him a second assurance that if after week 6 I wasn’t making an impact then I would walk away from the job without a word.
He was impressed by my confidence. Knowledge is power and what I had gleamed from the reports, told me everything I needed to know.
The best salesman in the company was doing £160,000 per month in business. This was with a 6% margin & lots of credit notes. His profit was £9,600 per month. I also learned that one product he was selling was at a 3000% loss. Not much of the product was sold, but nevertheless, it was still a huge loss.
From my product cost & stock list, I made 3 columns, cost plus 10%, 20% & 30%. It was from here that I started my new growth strategy campaign. I wasn’t too worried about the clients who were already ordering.
I was more interested in doing deals with my dormant accounts. On week 2 I picked up the phone and set about making appointments. I told each one that I had deals that could not be beaten. My appointment schedule began to fill up very quickly.
There are 2 types of sales people for reference. One is an actual sales person and the others are called order takers. I was a sales person; I had been doing it since I was 11 years old selling chocolate bars at school.
On my appointments I always requested to know what were my customers 5 bestselling products. Why five, because I always had a chance of placing a least one of them. I would always add at the end, a good deal of cost plus 10% on high stock items to put the icing on the cake. Some took me up on this and other didn’t.
By the end of the first month, I had a dozen new accounts that had never spent in 6 months to 2 years previously. I even managed to place the biggest order for drywall screws the company had ever seen. The order value was not huge about £6,000, the amount was 14 million.
We had 100 million on stock so it was small fry. I am a big believer in, if you do not ask then you do not get. If I couldn’t beat a price, I would always ask my customers for proof.
That the prices they had from other suppliers were real. In some cases, I know that other suppliers were losing money from my cost prices. By the end of month one, trade was going down but my margins were going up. I wasn’t worried as I wasn’t being a busy fool.
The credits on my customer list were also getting less. At the beginning of the second month, I targeted a big spending customer who hadn’t spent for nearly a year.
He was quite tough on the phone, I told him I would have prices that he could buy from. He said I am busy and I don’t have much time. You tell me when you have time and I will be there I said. He said come at 6am in the morning, I replied I will be there.
I knew he was testing me, again I rose to the challenge, because I had a plan. It was an hour drive for me so I needed to be up early. By the time I had left I had another 9 million drywall screws in the bag as part of a £10,000 order.
I was on my way and I was getting noticed by senior management. This was nice but my passion was the buzz of getting the orders, putting the strategies in motion and finding the best solution for each of my customers.
By the end of month 3 my area was doing £130,000 per month with a 19% margin. I had increased profit by 13% although sales were down. My overall profit was £16,900 per month. I had nearly doubled the profit margin on less sales in just 3 months.
I was then headhunted by a new company who wanted to grow an arm of their business. I was given an offer I couldn’t refuse with double the money. It was a no brainer for me to move on and put the next growth strategy in action. It turned out that the previous best salesman was an order taker.
Who just gave everything away cheaply to get an order making himself appear busy? A word to the wise for all business owners. If you fail to plan the right growth strategy going forward then you could be planning to fail. DON’T let yourself fall into this trap.
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