Route to Market – is your sales organization optimized?

When was the last time you reviewed the structure of your Sales Organization? How has the marketplace changed since then? Many Companies review their business strategy on a regular basis, but very few pause to look at the selling environment they are competing in and the appropriateness of their Selling Organization for this new reality.

This is the 3rd in a series of 5 Blogs that will look at how a change in your competitive landscape can impact your Route to Market.

Has your Product portfolio changed?

Changes in your Product/Service offering can impact the demands on your Sales organization. Has your Sales organization made the necessary adjustments to the change in your product portfolio? Think back over the last 12 to 18 months and ask yourself the following questions:

Have you introduced new products that are sold through your existing channels, but in a different department within the store? Will this require a different style of selling? For example, McCain Foods is dominant in the Frozen Food segment of the grocery channel. Years ago they decided to expand into the Dairy segment. While their Customer base did not change, everything else did. The buyers were different, the margins were tighter, shelf life was much shorter, store personnel had much greater influence as it was a direct delivery segment vs. going through the Chain’s warehouses. To manage this business McCain established a separate sales organization as it required a much different skill set than existed within their main sales force.

Have you added a line of Luxury products to your main stream business? As a result you may now be selling to different buyers or possibly different end consumers. How are the expectations of these new Consumers / Customers different, does your Sales organization have the capability to meet these new demands? If you are selling to different buyers their expectations of your sales representative may be different. At Treasury Wine Estates we produced a wide range of wines with retails that ranged from $9.95 to $500.00. The majority of the higher priced wines were sold to high end restaurants. The decision makers tended to be Sommeliers. When they were buying luxury wines they expected the sales representative to be as educated and passionate about wine as they were. So we developed a sales force within a sales force and called them the Heirloom Wine Group. This team was seen as peers by their customers and had the credibility to sell the Luxury portfolio.

Another example would be Toyota. When they launched the Luxury brand, Lexus, they realized that they would be selling to a different consumer. This consumer would have different expectations of what Product, Service and Value meant. Toyota took it a step further, not only did they create a new Sales division; they created a totally new distribution channel.

Are you expanding by entering the Private Label and / or Contract Packaging segment? As competitive pressures increase, the need to drive costs out of your business is crucial. One way of doing this is through increasing the through put at your manufacturing facility. Becoming a supplier of Private Label brands to your existing Customers or becoming a Contract Packaging supplier for a competitor are ways of doing this. In either case this is a very different sale than your own Branded business. The nature of this business requires a much broader perspective on the business and relationships with your customers. This should be handled at the senior level with a multi discipline approach.