The New Salesman: Supply Partner Relationships
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| Knowing the ins and outs of key Supply Partner relationships can jump start the New Salesman's selling efforts. |
Know your friends – Relationships with Critical Supply
Partners
They say no man is an island. I believe no salesperson is an
island. The only time the Lone Ranger is a constantly successful hero comes in
the pulp-fiction westerns on TV. In reality, sustainable success only comes as
the result of building a number of alliances. We have talked about product
knowledge, building relationships with customers and setting expectations.
Let’s shift our time toward building profitable alliances with the
strategically important vendors – we call them Supply Partners.
Nearly every distributor has special relationships with a
handful of critical Supply Partners. Oftentimes, our business is so closely
tied with these suppliers, that they receive special attention from our
organization. Over the course of time, there are countless stories of
salespeople short circuiting strategic relationships because they failed to
understand just how important these people were to our business.
Let’s start from the very beginning. The new salesperson
must understand exactly who these critical Supply Partners are and why they
hold that status. I believe a list is in order.
Earlier we rambled on about setting expectations and
building product knowledge. Hopefully, your plan for building product knowledge
pushes these crucial Supply Partners to the forefront. Whenever there is a
choice, the new sales guy should grasp the offering of the Supply Partner
first.
The relationship with the sales team of these key Supply
Partners should be given a jump start. Here I recommend some type of joint
introduction along with an explanation as to the place the new seller fills in
your organization.
The rookie seller should understand in no uncertain terms
that their job is to create and nurture a one-on-one relationship with the
person closest to your organization at this Supplier. Backward selling is
definitely in order.
In today’s distribution environment, overlapping
distributors are found all too often. On the flip side, it is not uncommon for
a distributor to have second or even third lines. Here’s the way it works.
MFG A is our key Supply Partner for left handed widgets.
Unfortunately, they are both high priced and have multiple distributors in the
territory. To offset this weakness of MFG A the distributor has added El Cheapo
widgets to their line card for cost sensitive customers. Sound pretty common?
Here’s where distributors damage their reputation and upset well laid
strategies.
The new salesperson inadvertently introduces El Cheapo to a
customer who should have gone to MFG A. Because of the mergers, acquisitions
and other shifts in the way manufacturers are going to market, the real issue
is much more complicated. Perhaps MFG A is strong in left handed widgets but
weak in widget housings. The permutations are many and confusing to the new
salesperson.
Problems grow because very few distributors take the time to
spell out exactly when and where the key lines should be used and under what
conditions it is reasonable to substitute something else. Think about this from
another level. Here stands a new employee. He or she has less than a year of
experience with your company, yet is making decisions which impact the
strategic direction of your whole selling effort.
Let’s recap:
1) Who are our key Supply Partners?
2) What products do they make?
3) Here is the local rep, build an alliance with him to
breed success.
4) Here is when (if ever) you substitute another product for
the key vendor.
5) Here are the gray areas where you need to ask first.
6) An error with an important Supply Partner can cause harm
to our business as a whole.
Finally, it doesn’t hurt to explain the whole supplier
stratosphere with your new sellers. Here is our own personal version from The
Distributor’s Annual Planning Workbook:
1. Profit Partners– these are the supplier who
account for day to day profits. They work closely with your team to grow
business today and provide the revenue flow that supports your business.
2. Strategic for immediate growth – these are
suppliers that allow you to produce growth and revenue next year. Often these
are product lines on the periphery of your current sales. For example, an
electrical distributor might produce immediate growth by working with a vendor
of electrical safety equipment. Just a little attention today could produce
growth without a great deal of training and positioning. These will never make
your top 10 suppliers, but adding a couple hundred thousand to the top line
sale is not a bad thing. (By the way, I recommend setting a minimum growth
amount to make this list. This varies from company to company but $100K in two
years is a good starting point.)
3. Strategic for long term growth – these are
accounts which drive your company into the future. They stand in place to be
major producers sometime in the next 5 years. As our world changes these
manufactures are emerging technologies which position your company over the
longer haul.
4. Customers want them so we keep them around –
suppliers that you would like to convert their sales to something else but
customers keep asking for the brand. Some manufacturers have strong brands but
employee saturation distribution. They bring little strategic value to your
company, the margins may be low, and they do little to improve your place in
the market.
5. Line fillers– we all have them. We take orders for
their products but don’t really proactively sell their products.
6. Don’t know why we have them – do little for us and
occupy a small place in our catalog and on our shelves. We probably would have
severed ties but just haven’t gotten around to it.
The
full version of this workbook can be purchased through Amazon.com at http://tinyurl.com/Dist-Annual-Planning-Workbook)
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