Five things suppliers can do
Many articles on material handling supplier/distributor relations subject focus on recommendations to suppliers for clear distribution channel policies, annual joint planning sessions with material handling distributors, establishing mutual expectations or working together on marketing programs. These are, of course, basics of selling through material handling distribution. Since these principles are well-covered elsewhere, this article offers five suggestions specific to material handling, with a more front-line focus.
Create a “Big Job Early Warning System” for Top Supplier Management
Most material handling suppliers have a procedure to allow, or even encourage, distributors to seek additional discounts for “big jobs.” However, there are several issues with the way this is handled that can make it ineffective for both suppliers and distributors. Often there is an almost exclusive focus on discount/price. The big job hits the supplier top management radar screen so late in the sales process that non-price tactical and strategic sales activities are no longer effective. Sometimes the big job never gets to top management’s attention until it is lost. The process of giving the extra discount is often made without attention to the other tactical and strategic sales aspects of the opportunity. The project is never “strategized” by key supplier sales talent.
|In the material handling industry, relationships still matter. Supplier management should encourage their people to develop personal, professional relationships with distributor personnel at all levels.|
A more effective practice could be to establish parameters and practices for a Big Job Early Warning System—a method of notifying top supplier management, early in the sales process, that a large opportunity is on the horizon. Supplier management can then decide to focus resources on the desirable projects where their input, strengths, strategies, tactics and resources can help the distributor get these jobs on a basis beneficial to both the supplier and the distributor—not just on a discount/ price basis. With enough advance knowledge in our industry, sales strategies can encompass delivery commitments, extended warranties, references, site visits, specification alternatives, sales visits by special top management, demonstrations, equipment customization or installation arrangements. The possibilities are many. The worst thing a salesperson can hear from a supplier is, “If only I’d known…”.
Create a Demonstration Center
Well-planned visits to supplier demonstration centers and showrooms can be among a supplier’s most effective tools in creating distributor focus and sales effectiveness. These visits allow top supplier management who have offices near the showroom to focus on visiting distributor personnel, make visiting distributors and customers feel important, build personal relationships, tell the supplier’s story, educate on the latest things and give a physical point of reference for the supplier. Well-planned distributor sales visits with customers can close deals. Demonstration centers/showrooms encourage distributors to send more salespeople to supplier training sessions. Material handling industry supplier best practices in this area include:
- Showrooms with both the supplier’s and competitors’ equipment for side-by-side comparisons and training
- Visits planned weeks in advance, with published agendas, sharing of travel expenses and social events as appropriate
- Complete operating systems that test actual product from customers, including videotaping
- Scheduled meetings with top supplier management
- Computer simulations of complex customer applications
- Facility tours
- Meetings with operating personnel who will process the distributors’ orders and the customers’ orders.
Several material handling suppliers have employees whose primary responsibilities are to manage showrooms/demonstration centers, along with encouraging and managing visits to these centers. Several suppliers include visits to their showrooms and other facilities in their distributor expectations. They evaluate their distributors on how often they visit and bring customers. The material handling industry involves physical things. Suppliers should leverage that with professional demonstration centers, showrooms and visits.
Focus on Field Representatives
Recognizing the need for face-to-face communication to train, communicate and gain focus with distributors and their salespeople, most material handling suppliers employ field representatives. Unfortunately, these representatives are often not effective in developing sales for their companies. This, of course, is the subject of not a few paragraphs, but volumes. The purpose here is simply to refocus material handling suppliers on their field representatives and highlight a few issues from distributors’ perspectives.
How effective are they in leading sales meetings at distributorships? Do they just hand out the new catalog and read from PowerPoint slides? Do they know how to gain appropriate interest from distributor salespeople? To effectively communicate key points to help sell more?
How effective are your field representatives in helping distributors solve problems? Do they know and have relationships with key people in the supplier’s own organization so they can help make things happen? How recently have they been “at the factory” to get up to date and build these relationships? Despite the extra travel expenses, the most effective supplier representatives are often those based at the supplier’s headquarters or facilities. They have quick access to the right systems and processes to help distributors. They are up to date. Supplier representatives based at, or who frequently visit, the supplier’s offices also tend to identify more with their company than representatives who are remotely based and seldom visit their company’s headquarters or facilities. Representatives who live “in the field” can quickly become forgotten, alienated and ineffective representatives for suppliers.
How effective are your field representatives in focusing on the big jobs? Have they created their own early warning systems with distributors to identify and attack large jobs? Can they communicate these opportunities effectively back to their own organizations and organize resources to sell them?
Can your field representatives communicate effectively with both distributor salespeople and management? Are they respected by their distributors?
Different suppliers have differing responsibilities and expectations of their field representatives. Suppliers should constantly be evaluating their effectiveness.
Build, Encourage and Maintain Personal Relationships
In the material handling industry, relationships still matter. Supplier management should encourage their people to develop personal, professional relationships with distributor personnel at all levels. Ideas for supplier management to facilitate these relationships include:
- Develop and maintain a database of distributor key people, particularly salespeople.
- Make field trips. Supplier management and key operating people should plan frequent visits to distributors. Face-to-face time is better than Facebook time.
- Encourage peer-to-peer relationships. Supplier order-processing people should have a relationship with distributor order-processing people. Shipping management at suppliers should get to know warehousing and unloading personnel at distributors. Warranty administrators should know distributor service administrators and managers.
- Encourage employees who regularly interface with distributors to attend industry meetings, such as the MHEDA Convention and other live meetings.
- Build a demonstration center/showroom and encourage distributor visits (see above).
- Pick up the phone and call a distributor principal, sales executive and salesperson to thank them for a large or key order. Don’t leave a voicemail or send an e-mail—have a real conversation. Say “thanks” a lot!
- Participate in distributor-sponsored events—customer golf tournaments, shows and annual awards dinners.
Ask Open-Ended Questions
This article offers a few specific actions and practices material handling suppliers can take to more effectively sell through their distributors. To learn more from distributors, suppliers should constantly ask open-ended questions. What do you like about doing business with us? What don’t you like about doing business with us? What is your biggest issue with our company?What is the biggest customer service issue you have with our company? How effective are our representatives when they call on your company? Who at our company does an outstanding job for your people? What do some of your other material handling suppliers do that is really effective for you? And the ultimate question, “What can we do to help you sell more of our material handling products?”
Of course, asking open-ended questions is only half the job. Now comes the tricky part—listening!
|Meet the Author
Gary T. Moore is a speaker and author based in Denver, Colorado, and on the Web at www.objectivebasedselling.net. He served as MHEDA President in 1998.