SUPPORT NOTES FOR: "TARGETING NEW PROFIT GROWTH OPPORTUNITIES" (article 2.21)
For more on how to think about and calculate how much incremental margin will flow through to the profit line for several different selling scenarios including "more old items to an old customer within a bigger order", see pages 4-5 within "Chapter Two" of a "forthcoming book". This chapter along with two others is posted on the home page of www.merrifield.com. The specific URL for "chapter two" is: http://min.isisit.com/merrifield/books/Chapter 2.pdf
Because key account cracking was just not happening with 90% of our sales force and 100% of our rookie sales reps in 1976. We began a "hive off program" in which we went to our proven "account cracking" reps and "bought back" the bottom 50% of their active accounts which generated about 10% of their commission income. They chose the accounts, the company wrote them a check, up front, for whatever they had made from the accounts in the previous 12 months. These small, slow-to-no-growth maintenance accounts would then be re-assigned to a rookie sales rep or a telesales rep.
We then started an aggressive "re-assignment of big untapped potential accounts" program. We would identify accounts in other veteran reps territories that had big untapped or minimally tapped potential. We bought the account from the rep, so they had 12 months to make up what minimal compensation they might be losing. We would then assign the target accounts to the account cracker.
We then created a total-team-selling plan for these target accounts which included:
- management joint calls and continuous braintrust/brainstorming progress reviews
- spontaneous heroic extra service efforts from operational folks
- extra expense support as needed from the company (not the rep)
- And, an extra growth bonus for the rep on incremental margin growth in addition to normal commissions.
Lots more on "account cracking" is in the annotated slide show at this URL: http://min.isisit.com/merrifield/articles/Cracking_Target_Accounts.pdf.
For specific steps on "target team selling" you might also read "Distribution Channel Commentary (DCC) #7.3, part 2 which is covered on pages 7-8 of that commentary at this URL: http://min.isisit.com/merrifield/articles/7commentary.asp.
For some specific case ideas that distributors are using for their target account/team selling programs, check out DCC # 9.3 at this link: http://min.isisit.com/merrifield/articles/9commentary.asp.
For a three-page summary on the memo written in ’76 on rethinking marketing around the old-to-old matrix, see pages 4-6 of Exhibit #26 at this URL: http://min.isisit.com/merrifield/exhibits/LeadingFromMiddle.asp
For more specific, how-to distributor case ideas for 10 x 10 selling thinking, see these DCC topics:
13.2 "The Wisdom of 10 x 10 selling" at: http://min.isisit.com/merrifield/articles/13commentary.asp
14.3 "10 x 10 reader case study ideas" at: http://min.isisit.com/merrifield/articles/14commentary.asp
10.3 "Let Customers Strategically Manage Your Core Inventory" at: http://min.isisit.com/merrifield/articles/10commentary.asp
8.3 "Fill-rates As an Organizing (Service) Theme" at: http://min.isisit.com/merrifield/articles/8commentary.asp
In one explanation I can not give every distribution location a prescription for how to sell more profitably to your "core" starting with your best historical niche of customers. I can share a common process, however, that all distribution locations can use to start down the "more to the core" path. First, go to our annotated slide show # 10 at this link: http://min.isisit.com/merrifield/articles/Identify_Customer_Niches.pdf.
The notes in this slide show will lead you to other articles as well as refer you to some of the 53 modules within our "High Performance Distribution Ideas for All" transformation training program.
More on the video/DVD based program can be found in the center of our homepage. The product has a negligible coast, especially for "re-sellers" and it is unconditionally guaranteed for 30 days.