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Keys to Market Access, Part 3: Measure the Right Things

Written by Mike Marks, Steve Deist on Wednesday, 08 April 2015. Posted in Distribution, Manufacturing

IRCG Whitepaper Cover1A market access strategy provides a framework for distributors to align their investments with real opportunities for growth. This blog is the third of five looking at the five keys to unlocking profitable growth.

The third key to a successful market access strategy is to measure the right things.

How well are you accessing the market with your sales investments? If you’re like most distributors, you’re probably measuring sales productivity based on sales or gross profit per person. Sure, it’s easy to measure, but it provides no insight whatsoever into the activities that generate the results. It’s like measuring how hard an engine is working by looking at the speedometer instead of the tachometer.

A key component of improving your access to growth is analyzing activities in addition to results. A lot of companies put too much field sales resource into customers that don’t value it; they call on customers far more frequently than they need to; or they provide them with technical sales that they don’t really value.

Remember the demand creation categories described in Part 1 of this series of blogs: protection, interception and disruption. If you are focused on protection then measuring service levels may be more important than tracking monthly sales variances. Interception can be gauged by capturing the number of critical sales events seen, intercepted and won. Because disruption is by definition proactive, it can be measured by comparing target account growth with the overall average for your company.

Strong sales managers will take this data and make it actionable. A strategically designed sales incentive plan will serve as reinforcement. It’s critical to eliminate low-value activities by sales reps and direct them to high-potential opportunities. Targeting the right opportunities is one of the best ways to maintain or grow overall revenues.

The next blog in this series will examine what true market potential is and why it’s important to challenge long-held assumptions about your markets.

Download the 5 Keys to Unlocking Profitable Growth (PDF).

 

About the Author

Steve Deist

Steve Deist

Steve Deist has been a IRCG Partner for six years. He has over 20 years of experience working for hundreds of distributor, retail, manufacturer and private equity clients in dozens of lines of trade. He is a highly rated speaker, a permanent University of Industrial Distribution faculty member and a distribution company board director.

Steve has extensive knowledge of the distribution and supply chain space, with substantial experience in retail, construction and industrial channels. This experience includes:

  • Strategy, sales effectiveness, operations, supply chain, marketing and technology projects for over 100 organizations over the past 10 years. These clients have ranged in size from $5M family run businesses to Fortune 500 corporations.
  • Numerous marketing channel projects for top tier manufacturers which sell through dealers, distributors, retailers, etc.
  • Frequent industry speaking engagements for clients including, trade associations and manufacturers on a broad range of subjects. These engagements have included workshops, technical sessions for management level audiences, strategic sessions for executive level audiences and keynote speeches.
  • Due diligence and related projects for top tier private equity firms.

Steve is IRCG’s strategy guru, focused on helping companies achieve lasting competitive advantage. His hands-on approach enables him to apply leading edge concepts to the practical realities of daily business.

Prior to joining IRCG, he was director of consulting services at a major supply chain software vendor. Steve’s thought provoking articles appear frequently in premier industry publications such as Modern Distribution Management. Steve has authored three books published by NAW (The Five Fundamentals for the Wholesale Distribution Sales Manager, Value Creation Strategies for Wholesaler-Distributors and the upcoming What’s the Right Plan? Effective Sales Incentive Design for Wholesaler-Distributors).

Mike Marks

Mike Marks

Mike Marks co-founded IRCG in April 1987. He began his consulting practice after working in distribution management for more than 20 years. Over the years, his narrow focus in B2B channel-driven markets has created an extensive number of deep executive relationships within virtually every business vertical in construction, industrial, OEM, agricultural, and healthcare.

Mike has led project teams that improve market access by aligning resources to growth opportunities serving manufacturers, dealers, and distributors. Clients have ranged from small privately owned firms to many of the industry’s market share leaders. Ownership structures have included owner-operators, private equity, ESOPs, and publically traded firms. Mike is proud of the teams work and the confidence clients have shown with additional project work.

He has written extensively, and is frequently quoted on many industry issues. He has substantial board experience on both public and private distribution firms. His contributions to the field include serving multiple terms as a Research Fellow with the National Association of Wholesaler-Distributors, permanent faculty at Purdue University’s University of Industrial Distribution, eight years as Graduate Adjunct Faculty in the Industrial Distribution Program at Texas A & M University, and rendering several precedent-setting expert opinions in contract disputes between manufacturers and distributors.

Prior to forming IRCG, Mike held the position of Executive Vice President at Lex Electronics, an $800 million vertically integrated electronics distributor in Stamford, CT. Mike’s path to management in his early career was through increasing responsibilities in sales and sales management. He also completed a tour of duty as a manufacturer’s representative.

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