Industrial distributors with historically strong commercial models share certain key elements: strong local market knowledge, rapid response time for customer issues, and sales people who are all things to all customers. Sales reps who were experts on all products and applications were able to grow accounts and territories by answering any imaginable customer need.
But can versatility negatively impact productivity? Are generalist sales roles more effective than specialized roles? Alexander Group’s recent distribution project experience and research have identified three inputs that should be considered when crafting field sales roles.
Industrial distributors have evolved from product pushers to providers of solutions and systems that incorporate advanced technology. This shift has expanded product and service portfolios, opened new areas of growth and increased margins. However, it has made the job of the generalist sales rep exponentially more difficult. Buyers are no longer content with sellers who have mastered the catalog and can expertly talk terms and price. They seek a technical expert that can provide value-added design services, think through alternatives to reduce long-term costs, and enable users of industrial systems. Sales reps with large territories and broad product line accountability may not have the bandwidth or the expertise to succeed in this consultative selling environment.
In the recent past, distribution field sellers could expect to spend an entire career working the same territory for the same company. Time was on their side–sellers learned the product offerings, territory dynamics and customer needs over the span of years and decades. Generalists’ effectiveness came from running the route and accumulating knowledge over time. However, the changing dynamics of the workforce has disrupted this model. A salesperson is less likely than ever before to spend an entire career in one role. Research from The Bureau of Labor Statistics shows that an average worker will hold 12+ jobs in a career. This trend has a significant impact on the learning curve of an industrial sales rep. Even with clean CRM data, comprehensive succession plans, and training and onboarding programs, a rep still takes months, quarters or even years to become fully productive. The broader the focus of the role, the longer the ramp up time.
For new distributors (or distributors new to a market), all revenue (or gross profit dollars) is equally valuable. Fast growth is the name of the game, no matter where it comes from. For larger and more established distributors, strategic growth is the goal. Profitability and sustainability depend on the right mix of products and services sold to the right mix of customers. The risk of a generalist sales model is that an individual seller may opt in or out of certain opportunities. Lack of comfort selling the product, difficulty or duration of sales cycle, and unfamiliarity with the customer’s specific needs are typical culprits. It is risky to assume that a generalist’s sales time allocation or results will align with a specific growth strategy, especially when sellers tend to take the path of least resistance to achieve sales goals.
The three trends above point to a movement in distribution sales role definition. Most organizations want to capture the efficiencies that come with specialization but don’t want to give up the versatility that comes with a generalist approach. The latest industry research shows that considering the following questions can inform sales role specifics.
Defining field selling roles has a direct impact on profitability and growth. Our research shows that with proper role definition, sales roles spend 39% of their time in value-added activities versus 18% for unfocused generalist roles.
AGI recommends reviewing sales role execution and results annually and updating roles to coincide with changes in commercial or channel strategy. Alignment between strategic goals and role focus is critical for industrial distributors looking to grow at above-market levels. Contact us to learn more.
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