3 routine sales activities drive distributor revenue:
- Deal Size
- The Number of Leads available to your sales reps
- Your Win Rate
In Step 2 in this series, we discussed Deal Size. Step 3 describes how you can increase the number of leads available to your sales reps.
We regularly measure our customer’s walletshare. The highest measurement we’ve ever calculated is 66%, while most customer’s walletshare is in the middle 50’s. And that is with their most valuable (or Ideal) customers. With the Non-Ideal Customers it’s often in the mid 30’s.
In our 20 years of experience, people normally don’t do what they are not asked to do. Take you for instance. Why are you reading this series? We asked you to.
So what’s holding you up? My guess is it’s the same thing that’s holding you up from getting more equipment leads. You’ve got plenty of people who can make the sale, what you lack is someone to originate the sale. Someone to ask your customers and prospects for their business.
I know. You advertise, you’ve got a website, your sales reps are supposed to prospect, you supplement that by buying leads, you send email, you network, etc. You do everything…but ask. If you don’t want to do it, hire someone who knows what they are doing to do it for you. It’s easy to monetize such a decision, and we are happy to assist you with the ‘asking’ part of the process.
When we ask our client’s customers why they aren’t buying aftermarket products and services from our clients, we typically get 2 answers.
- “I didn’t buy because I didn’t know you sold it”
- “No one ever asked me”
That’s all the sales resistance we run into.
Help! I need more leads!
When distributors think about getting more leads they are usually thinking about getting more equipment leads. Certainly, equipment leads are critical to the long term growth of distributorships. But where is it written that you would have fewer equipment leads if you also worked aftermarket leads? Is there a business reason why equipment and aftermarket leads need to be mutually exclusive?
We began generating equipment leads in 1997. And since then, a single statistic has remained constant. It was true then, and it’s still true in 2016. For every equipment lead we produce, we generate at least 15 aftermarket leads.
More sales leads means more sales revenue. A 5% increase in sales leads, assuming no change in either Deal Size or Win Rate, translates into a 5% increase in sales revenue. Based on last year’s sales revenue, what is that worth to you?
If you want to grow your distributorship and maximize your profits at the same time, you need to give serious consideration to taking as much aftermarket business away from your competition as you can.
I could understand distributors avoiding aftermarket leads if going after them reduced the number of equipment leads available to them, but that isn’t the case. Selling more aftermarket products and services to your customers and to your competition’s customers actually has a positive impact on the number of sales leads available to you.
Selling more to your existing customers not only generates more sales revenue, it also improves customer retention.
More customers = future equipment sales
Selling aftermarket products and services to your competition’s customers generates more revenue for you and weakens your competition’s customer retention and wallet share. Again, that results in more equipment leads for your distributorship.
In Step 4, we’ll explain how it’s impossible NOT to increase your average win rate by selling more to your existing customers—you won’t want to miss it!
In the meantime, if you have any questions, please feel free to contact us here.