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Is Your B2B Distribution Sales Model Out of Balance?

Is Your B2B Distribution Sales Model Out of Balance?

July 10, 2018

At MDM’s Sales GPS in late June, we spent two days with more than 100 distribution leaders discussing ways to adapt to the changing B2B distribution sales model. One consistent question from all the attendees was, “How can I better manage my outside sales team resources?”

Your business is probably still driven by an old-school, belly-to-belly sales model, but are you making the course corrections you need to get the most out of today’s resources?

As B2B customer relationships are changing in the digital age, so is the role and power of the outside salesperson. Is your sales model out of balance, and is it nimble enough to adapt to an ever-changing environment?

If you fear that your outside sales team will leave for greener pastures and take the business with them, it is likely you are managing your sales team in the same way you did five years ago.

Here are three key warning signs that your outside sales team is running your business — and that your sales model might be out of balance.

  1. Account packages that are too large and leadership that just lets them keep growing. It’s difficult to make more than a few high-impact, face-to-face sales calls a day. On average, most outside salespeople find it difficult to manage more than 40-50 accounts effectively, even in a compact geography. If your outside sales packages have more than 80 accounts per salesperson and are growing, your coverage model probably needs some tweaking. Are you utilizing the right mix of outside, inside and digital channels to manage your account base?
  2. Only using the old-school playbook when an outside salesperson exits. Does your sales leadership immediately reassign all the newly orphaned accounts to another outside salesperson? The old-school playbook thinking is that every assigned account needs to be reassigned to another outside sales person. If this sounds familiar, you may be missing a big opportunity to reset these accounts to the right sales channel.
  3. Poor line of sight with your large accounts assigned to the outside sales team. Do you have an annual account planning process for your larger accounts? In many cases, outside sales teams can leave management on the sidelines, with a lack of information. I’ve worked with many sales people who approach account management like they own the account. They are on short-term free agent contracts. As soon as the guarantees or perks run out, they start entertaining offers. Then, if they move to a competitive distributor, they use the fact that they left your leadership on the sidelines to try to take the business with them.

So, how do you get better line of sight? It doesn’t mean you have to have a customer relationship management system running your business. However, having an organized sales planning and review cycle is critical to protecting your business with your largest customers.

It can be a scary proposition to push your commissioned outside sales team to let you be part of their customer relationship.

This bit of wisdom from my friend Dick Schmid says a lot: “When a salesperson leaves or joins us, they say they will bring all their business with them, but in reality, it’s closer to half the business. And it’s even less if our leaders have done proper account planning and have a relationship with the customer.”

If you wait on the sidelines and don’t have a robust account management process already in place when a sales person leaves, gets ill or retires, you just have to hope it works out. Hope isn’t a strategy you can count on.

If you have one-size-fits-all outside sales relationship sales model, it might be time to consider some new approaches.

As always, we value your feedback. Feel free to comment below or contact me at john@mdm.com

 

 

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