Wednesday, July 6, 2011

How to Organize a Steel Company Sales Force

A merger of two small companies in a large company with the consolidation of the backlog - or the departure of several key members of the sales team - are among the reasons to rethink the organization of the sales force. The steel companies, a way to implement a reorganization to lead this process of understanding the market of steel - that is, by understanding the structure of the client and by careful alignment of the roles of the sales of this structure customers.

Understand your customers

The process begins with an analysis of the backlog and steel company and the calculation of annual sales revenue per customer. From there, it is relatively easy for all customers in the segment then one of three groups:

* Large customers who are their biggest customers, annual sales. Perhaps 10% of customers (in terms of numbers) will be in this group and represent about 60% of sales (in terms of revenue)
* Median clients, which are an intermediate
* Small customers, which are smaller buyers, buying perhaps only once or twice each year.

The Business Plan

With client understands, then it is relatively easy to see how much time should be allocated to each group of customers. From large customers, assuming one visit per month, and a typical visit takes a day (including travel, administration, etc), then with a backlog of 60 such clients (eg for a small business steel), the company would require a team of three representatives from key customers (three sales staff with 20 visits each month) to manage all the necessary customer visits in a typical month.

In a typical steel company small, while the merit of the largest customers, at least one visit per month, customers of medium-sized companies usually require less attention, perhaps at the level of a half-day visit (including the trip) every three months. For example, with 360 clients identified in the middle level, the steel business requires half 120 customer visits per month - the equivalent of 60 days the man of the visit - ie three additional sales representatives for this client group.

Continue planning this way, assuming that small customers need to contact only once every six months, the company could easily cope with this level client through a telephone sales operation rather than through visits direct customers. Assuming that a single telephone sales operator could face small ~ 12 customers every day (without actual visits), a company with ~ 1200 clients would require a team of telephone sales of at least two people full time.

Organize the team

In this example, a steel company with 60 major customers, 360 ~ 1200 medium and small customers showed the need for a team of three salespeople key customers for larger customers, three staff members for additional sales midsize customers and at least two members of the sales staff working in sales over the phone.

It is clear that the application of this method for any steel fabrication company require a specific adaptation of:

* The actual number of customers in different groups
* The distances involved
* Training requirements of rotating equipment and personnel
* Other duties of the sales team - such as in dealing with sales promotions, marketing of steel 'cuts' in the sale of shares of steel "non-prime" and similar tasks.

However, the scheme described above describes a first approximation that at least recognizes the structure of clients and the need for special emphasis is placed on major customers of the company. The approach also has the advantage of being very active in the design of paper - which means that each customer came regularly.

As with all frameworks, adaptation should be key, however, organizational learning gradually aligning the structure of the sales force behavior and what works best according to the real needs of customers and the specific circumstances of the company.;u=51546;u=15901;u=115313

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