SUMMER 2020 EDITION

Questioning Your Sales Team

A few weeks ago, we wrote a blog suggesting new questions for salespeople to ask their customers. The basic premise was simple. Salespeople, especially those limited to phone and Zoom meetings by the coronavirus pandemic, need to upgrade and improve the questions they ask when dealing with customers. Intermixed with comments from salespeople were inquiries from their managers who posed a question to us.

What should sales managers ask their sales team to better understand if progress is being made with customers?

Let's turn the tables and toss out 20 questions sales managers should ask their sales teams. I have broken the questions into seven categories and provided a few comments following each.

Customer-Centric Questions

We're talking to salespeople. Customers are their life, well mostly. Testing their actions and thoughts on the topic should probably be top of mind. But there are questions that demand answers.

1. Are there customers on your list who are under serviced and what should you do about it?

Distributor salespeople are often assigned more accounts than they can possibly main-tain. I still see account lists with upwards of 150 customers, but exploration indicates the salesperson only actively works with 30 of them.

The main reason/excuse provided by sellers and managers alike goes like this, "If an opportunity arises and somebody has to hustle over to the account, the salesperson is the one we send." For argument's sake, let's assume this is true. Would it make sense to devise a plan to periodically gener-ate some interest in those accounts? Across our industry, the salesperson title seems to be morphing into account manager. Shouldn't these account managers have a plan for servicing accounts they can't personally call on?

2. When was the last time you asked the management team to call your top five customers?

Thinking about our current COVID-driven situation, doesn't it make sense to under-stand the management direction of your top accounts? What do these customers see for the future of their companies? What new products and services will they value as they move into a post-pandemic era? Now is the time to gather information and speak to these folks about the future.

3. Who are your targets for growth and why did you pick them?

Research indicates sales organizations that proactively target accounts are 47% more successful in reaching their sales goals. It's important to understand if your team properly targets. To learn the answer to the second part of this question, ask if your sellers are selecting the right customers and if the selections have been made for the right reason.

Questions to Attract More Business

If ever there was a time to find more business, it's now. Ensuring your team is operating with a growth mindset is critical for success and perhaps survival. These questions offer a window into the situation.

4. Which quotes/proposals that you created last week were funded? How do you know?

Developing a proposal is time con-suming, especially if you are selling solutions. Sellers often relate stories of full days spent gathering information, working out pricing and developing customer proposals. Follow-up inter-views reveal situations in which the customer decided not to move forward. Wouldn't it be nice to know if the work was funded before spending the time?

5. How many opportunities have you identified with your customers?What is the dollar value of those opportunities? What is the prob-ability of their success?

Identifying the potential source of future business is a critical skill. Sellers argue that they maintain a list in their heads. I don't believe them. It's impossible to remember hundreds of potential sales without a process. Opportunity tracking via a CRM system is often noted to be the single most powerful tool in their software, yet many sellers do a lackadaisical job of entering data.

When they do enter the data, the numbers are heavily skewed by opportunities with existing customers with which the probability of success is extremely high—80% or greater. There are good reasons to record opportunities with lesser chance of success.

This practice provides a better under-standing of market potential. What can the seller or the customer do to improve the odds? More importantly, opportunities falling to the competition often disappear from the seller's mind. Here's a point to ponder: If for some reason you have a temporary advan-tage with technology, delivery or price, where would you focus your efforts to convert new business?

6. Do any of your competitors have a critical weakness?

In the near-term, there will be few new business opportunities in your market. You will have to wrestle any new orders away from competitors. Ironically, the only knowledge you have about the competition is their price.

Competitive organizations have issues, sometimes systemic problems. They struggle to deliver products, drive inventory levels down to maintain cashflow, lose salespeople and struggle with hundreds of other issues that impact their ability to properly serve customers. Most times, salespeople are oblivious to all this. It's a mistake.

Value-Proposition Questions

It would be a mistake to assume every seller understands the value your com-pany creates for customers. Attributes like great service, strong inside support and even locally owned are bantered around without much thought as to how any of these impact customers. For instance, does a Fortune 500 com-pany really care if the owner of your company lives nearby? In most cases they do not. Instead, the customer is searching for an important service to make his/her facility run better. It's all about the real value you deliver.

7. What value do you provide to your best customer?

Why does your top customer buy from your company? Perhaps you have an exclusive product line, expedited delivery, a great counter and technical specialists. The answer can't be generic like "great service" or "friendly inside salespeople." Insist on specifics.

8. What value-adds does your company provide that your competitors can't deliver?

First, it is important to understand, nearly every important competitor has their own value proposition. Yours may be a better match for some customers and not for others. Sellers rarely take the time to think about the situation. They should. Asking this question can start the wheels turning.

9. Which second-tier customers are potentially better matches for your services than for the services of others?

This question mirrors our question on targeting (question 3) and serves to explore the salesperson's understanding of their second-tier customers. Many salespeople have a lot to learn about their smaller accounts. Sometimes, it's a lack of attention, other times it's tied to an inability to meet the right people and in many cases the problem is skill-based. Asking this question provides the manager with opportunities to better understand each salesperson.

Price-Related Question

10. How do you determine the right price for your customers?

Unless your organization uses a rock-solid pricing process, the sales team sets your customers' prices. We're not just talking about negotiated project pricing. Our research indicates sellers have "magic numbers" that they use to set the price when no other direction is provided. In our industry, 20% is an enchanted percentage. Whenever there is a question, the margin is set at 20% more than cost. If there is an inkling of competition, the price drops even further.

Ironically, this important topic is seldom discussed in a meaningful way. The results are tribal knowledge-based pricing and greater price erosion. Demand a reasonable answer. Under-stand salespeople are responsible for dozens of customers and tens of thousands of products. If the seller says, "I know the market and know the right price." Ask them, how.

Service-Related Questions

It's no secret, I believe distributors need to begin the migration to fee-based services. A few have started the imple-mentation. Most struggle with moving forward. To make the transition easier, I recommend starting off with a strategy of only charging customers whose business and gross margin do not warrant the expense of the services. For example, why provide free service (or anything else) to a customer who only purchases from you when your price is the lowest in the market?

11. Are there any customers on your list who don't deserve your free technical/logistic or other services?

The technical, logistic and other support services you provide cost money, lots of money. Many times, distributors provide these services for free. Salespeople are sometimes confused by the thought of limiting the number of customers who receive these freebees. If the answer you receive to this question is everybody deserves your services regardless of size and buying potential, some education may be in order.

We Promised 20 Questions

Time and space limit our ability to provide lengthy explanations for the rest of the questions, but I still believe they need to be asked and answered. Here are nine more rapid-fire questions.

Process-Improvement Questions

12. What is the most time-consuming non-selling activity/distraction in your company?

The average seller spends less than 25% of his/her time engaged in face-to-face selling. What can you do to improve this situation at your company?

13. What information do you need prior to making a sales call?

After you find out what your salespeople need, make the resources readily available to them.

14. What value do you 'personally' derive from your CRM system?

CRM isn't just an expensive way for management to look over their seller's shoulder.

15. If a cement truck runs you over on your way home, how difficult would it be for someone else to serve your customers?

Do your coworkers know what you are doing? Be sure your salespeople make notes.

16. What tasks could inside sales do to create more selling time for you?

I believe inside sales will assume a bigger role in the future.

Vendor-Centric Questions

17. Which vendor reps are most helpful to you in generating more business?

Why are they the most helpful? What do they do differently?

18. Which vendor reps are least likely to help you develop business?

Should management get involved to help better engage these reps?

19. Do you know which manufacturers are your strategic partners?

What do these partners mean to the company? What could happen if the seller ignores one of them?

20. When have you introduced a manufacturer that provides the same products as one of our key strategic product lines?

Chances are you have some product overlap among manufacturers. At what point does a seller introduce a substitute for your "first" line strategic supplier?

Tying This All Together

Why ask all these questions? I believe sales managers must understand their teams. Not all the answers will be the same. Each member of your team has his/her own individual strengths, weaknesses and business outlook. Customer mix makes a difference. We must ask to understand.

The COVID situation has impacted our industry. I pray we never relive these pandemic days. If you haven't done a mid-year review with your team, I suggest you do so. I recommend you use some of these questions in your review conversations.

Finally...

I just did a quick count. I used a question mark on 51 separate occasions. I have lots of questions. If you have one, I would love to hear from you.

Frank Hurtte
Straight talk, common sense and powerful interactions all describe Frank Hurtte. He speaks and consults on the new reality facing distribution. Contact him at River Heights Consulting via frank@riverheightsconsulting.com or 563-514-1104.