Why Distributors are Revamping Their Sales Coverage Plans - Modern Distribution Management

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Why Distributors are Revamping Their Sales Coverage Plans

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B2B distribution sales managers generally believe that driving sales is all about hiring, retaining and managing the best account managers. You hire the most skilled outside account managers you can, and then pair them up with excellent inside sales support. Then, the more calls your skilled account managers can make on customers, the more the customer will buy. Your account managers use their product and industry expertise to educate customers and solve their problems, using those interactions to build long-lasting relationships.

The foundation of your business is built on this belly-to-belly sales process and you pay your account managers handsomely for their efforts. Now, that foundation is shifting.

Sales GPS Image 1

This chart from a compilation of B2B distributor survey data of end customers in 2013 shows what B2B distribution customers viewed as the key drivers of the relationship. The customer valued branches (inventory located where the customer wants it) and delivery excellence, paired with the human relationship driver — the account manager.

But in the past few years, there has been a big change to our business: Your customer is now calling on you. They are doing so digitally, and what customers value about what you do is changing.

Sales GPS Image 2

This chart, from a compilation of B2B distributor survey data of end customers in 2018, shows what B2B distribution customers view as the key drivers of the relationship. What has changed? The digital relationship and price are now top relationship drivers. Your website is more than just the window into your business; it is the key relationship driver for a growing list of customers.

Your customers are moving from human interactions (belly-to-belly sales calls and phone calls) to digital calls that they make on you.

The Evidence is in Your Data

I recently worked with an industrial-focused B2B distributor who wanted to see if this overall trend was affecting their business. The distributor was on a Cisco phone system, so we could look at the number of calls received and made from their locations year-over-year. The data revealed that the number of in-bound calls were decreasing by 33% every year for the past five years. We could see that email communication was going up every year. Maybe more customers were calling cell phones, but one thing was clear: the human talking to human interaction was decreasing.

Also see: “5 E-Commerce Resolutions for Distributors to Strengthen Your Online Presence.”

When we looked at the digital traffic on the company website, it was also obvious that customers were researching product specifications online versus calling the sales team.

This distributor’s sales team told me consistently that:

  • it was getting more difficult to get customers to set appointments;
  • customers had an ever-decreasing amount time for relationship building activities; and
  • the sales discussions were becoming all about price.

Those responses sure seem to match up with the second chart above.

So, what do you do about the trend and how can you potentially tweak your sales model to take advantage of it to grow your business?

The best way is to learn as much as you can about what other distributors are doing and take advantage of the parts that make sense for your business. We all say that every B2B distributor’s market position and channel is unique, and that truth means you have to customize the right solution for your business.

Our 4th annual MDM Sales GPS conference this year is about more than just these theories and research, it’s about seeing what others are doing to attack these opportunities. It’s a great place to see real B2B distributor case studies on ways to optimize your sales process, and network with other distributors and manufacturers who are making decisions on how to improve the sales process.

At our event, you can learn how other B2B distributors are:

  • Optimizing their top sales assets their account managers with sales enablement programs;
  • Improving their sales coverage model. Is it time to stop having massive account packages assigned to account managers to give them more commission, when you know they can’t call on the 100 accounts you have “assigned” to them?
  • Building better digital sales programs. See ways you can integrate all that digital interaction into sales and better customer interactions.

For more information on MDM’s Sales GPS, click here to learn more.

We welcome your comments, either in the comment area below or you can reach me at john@mdm.com.

John Gunderson VP of Analytics & E-Business

John Gunderson is vice president of analytics & ebusiness at Modern Distribution Management. Prior to joining MDM in 2018, he was a senior leader for 20 years, leading sales, marketing, pricing, analytics, and ebusiness with companies such as Crescent Electric Supply Company, HD Supply Power Solutions, HD Supply C&I White Cap, Anixter and EIS-INC a Genuine Parts company.

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