Customer Relationship Managerment (CRM), Sales - External, Sales - Internal (Organic)
Death of a Salesman
How you can avoid the dreaded “January syndrome” and make more money
I get more “let’s get together” phone calls in January than in every other month combined. It’s the same old same old: sales reps wanting to ﬂog their products. I call it January Syndrome, and the only relief is knowing that I won’t hear from these guys again until next year.
It’s not a sustainable way to sell, let alone build a lasting relationship. Unfortunately, January Syndrome afflicts truckers, too, and I’ve come to the conclusion that the outside sales rep model that’s been the industry’s engine for decades is on its deathbed. And should be.
Frankly, I’m shocked to hear myself say that. I’m sure so are my sales friends in the business whom I’m about to throw under a truck!
Since I started in trucking three decades ago I’ve been a fan of the outside sales rep model. I lived and breathed it and it worked. Apparently the C-suite truckers I cross paths with feel the same way. I get asked how to ﬁnd good sales reps more than anything else.
We’ll always need good sales reps. But times have changed. So have economics. The job of growing and main- taining customer relation- ships is too complicated and too important to be owned by one employee who’s making the same as the president.
Here’s why small and medium-sized ﬂeets need to ﬁnd ways to grow their busi- ness other than hiring outside sales reps.
Micro Math Doesn’t Work
Razor-thin margins no longer support the model. Let’s assume an experienced sales rep in any Canadian city will cost you a hundred grand a year in salary and commissions. Throw in late-model wheels, a desk, and entertainment (a bigger nut than you think) and the ﬁrst-year commitment is closer to a buck and a half. That’s before the ﬁrst pound of freight is secured.
Now look at your net margins. Forget about making money. How much new business would a rep have to secure in his ﬁrst year to break even? What about year two?
When was the last time a rookie scored 75 goals in the NHL? I rest my case.
Margin Math Doesn’t Work
Margin is about two things: math and leverage. When sales reps have a large number of prospects in their sales funnel, the math is in their favor, giving them the leverage they need to grow the good business and walk away from garbage.
When their funnel is “prospect light” the math is against them, their leverage collapses, and they’ll take any deal that comes across their desk. They need that customer in order to justify their existence at next month’s sales meeting.
Reps need to do more than sell, they need to keep ﬁlling the funnel. Prospecting is far too important to your company’s bottom line to be left to one employee. You won’t get margin if you’re afraid to say no.
Protecting Your Assets
How often do you hear your company’s biggest account being referred to as “Sue’s customer”? Sue is your VP of Sales. She might be the Hayley Wickenheiser of freight sales but no customer is hers alone. They’re your customers! Does Sue also own the trucks picking up your biggest customer’s freight?
In a transactional business like trucking, customers are your most important assets. Don’t put one person in charge of them. Protect them. If you don’t agree with this statement you sure will when it’s time to sell your business.
Birds of a Feather
Younger decision-makers are smart and tech-savvy and want to solve their own problems. They don’t need help from a sales rep they trust less than what they can learn (or not learn) on their iPhone. Hence it seems these days that securing new business has been dummied down to two extremes: 35-page RFPs or deal-of-the- day rate quotes. Too many sales departments have turned into nothing more than expensive ﬂocks of messenger pigeons dropping off margin-killing pricing.
Machines vs Man
My ﬁrst CRM system was a Rolodex ﬁlled with recipe cards. It worked like a charm in 1983. Today, CRMs are powerful, sophisticated technology platforms that can replace a good chunk of your high-priced sales force. Yet I am not convinced that our industry leaders truly appreciate the value of a well-executed CRM strategy. CRM systems will improve your ability to understand, manage, and protect your customers. They can also add millions of dollars to your enterprise value when it’s time to sell. That’s when you have to prove to every potential buyer how you secure and grow customers.
Yes, it’s possible to grow your business without Sue. That’s for next month!
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