A medium sized manufacturer of high quality, luxury tableware with international distribution.
What was the situation/problem to be addressed?
Over its very long history the Company had developed a highly autocratic management style. Sales staff lacked the ability and knowledge to manage their accounts and maximize sales within their areas. Customer satisfaction levels were poor as errors and queries were always referred to the Sales Director for decisions, making the process slow and long-winded.
Given the blame culture morale was very low throughout the organisation with staff turnover around 30% pa, resulting in a lack of knowledge among staff, existing staff temporarily covering vacant roles and high costs for recruitment.
What change was delivered?
- Members of the sales team were given training in account management and financial literacy including calculating margins and impact of discounts on net margins.
- the sales team to access & print off data about their accounts, which they could share with the client as necessary to maximize sales and profitability for both parties. Details included
- historic sales by account and product line, comparison of account performance to previous years, visibility of any outstanding orders, on-time delivery performance, number & description of display models at each reseller.
- Regular sales meetings were instigated, where best practice and intelligence was shared and further training provided, especially on new products and promotions.
- Each Sales Representative was matched to a member of the in-house customer service team so that customers had clearly identified staff to support them, who were in regular contact with one another and working as a team.
- Clear pricing structure created with discount authority levels set out for sales staff.
- Staff bonus scheme set up based on a share of improved financial performance.
- Appraisal system introduced setting clear, measurable objectives.
- Supplier Agreements were created explicitly stating commitment from both parties – level of marketing support spend (based on turnover and potential to increase business), retrospective discounts, number of models on display at retail, etc.
What were the outcome and benefits?
- Sales team able to make their own commercial decisions
- Sales Director able to address more strategic issues rather than working on day-to-day matters. He was also able to coach and deliver staff development.
- Improved customer information and satisfaction levels resulting in 20% more product listings within retail space over an 18 month period, which in turn increased sales by similar amount
- In the first years sales increased by 18% with corresponding increase in margin.
- Staff turnover is sales and customer service dropped from 30% to 2.5% pa.