Selling Distinct Products/Services

Trevor Akervik, Marco Tom Callinan, Strategy Development

Trevor AkervikDirector of Managed Services

• 13 years with Marco• 2001-2004 - Copier Territory Sales Rep• 2004-2009 - Copier Sales Manager

• 2009 - Director of Managed Services• Was the 1st member of the team• Sales atmosphere was almost 100%

hardware focused • Knew less than zero about IT industry• Wasn’t 100% convinced it was the

right career move…

Tom Callinan

• Founder and CEO Copifax, Philadelphia 1987• Sold to IKON September, 1997• VP Ops/CFO IKON MidAtlantic District, 1998• Marketplace President, NYC 1999 – 2001• Southeast Region President, 2002 – 2003• VP/GM Northeast Region, 2003• VP/GM East Region, 2004 – 2005• Strategy Development, 2006• Graduate of the Wharton School, University of

Pennsylvania

Management Drives Changes

• Organizational change can’t be led from the front line

• To be successful in a new business you need strong leadership and management processes– Ensure you have those in place before you try to

change the behavior of your sales professionals• Once leadership is in place use education and

incentives to change the front line employees

• When measured by employees, what size firm do you target

• Copiers– 50 – 250

• How about for MPS– 100 - 1000+

• And for MNS– 20-100

Using Market Segmentation

Copier

MPS

MNS

Segmentation Takeaway

• A traditional copier company’s base most closely mirrors an MNS target market

• Even with that overlap only 20% of your copier customers will be good MNS clients

• Nevertheless, 20% of 2,000 customers = 400 MNS clients– At $2,500/month/contract = $12 million business

Targeting ZBA Accounts

Sampling of 100 businesses in typical industrial park:• 40 percent are single placement segment I or low end segment II with fewer than

10 employees (80% of US firms have < 10 employees)• 5 percent are Fortune 500 Companies looking for a national provider• 5 percent are branch offices with purchasing at corporate outside of the area• 5 percent are your own customers• 5 percent are in another rep’s CRM in your office • 60 percent of your time is wasted randomly cold calling

You want to focus on the other 40%, those that are highly profitable and can buy MNS or MPS in addition to equipment• As you add other business offerings to your core customer

segmentation becomes critical

7

List Manage Sales Professionals

“The job is hard. Really, really hard. ‘But, not for the reasons you think. The combination of an awful lot of freedom coupled with the absolutenecessity of a disciplined mindset’ can be a dangerous combination for most people.”*• You are not hiring well educated business

managers or entrepreneurs so provide them some structure

*Article Source: http://EzineArticles.com/3718395

Territory Design To Maximize Revenue

• You can calculate your estimated annual revenue from equipment upgrades at every level– Company, branch, sales team, sales professional

• Each machine in field (MIF) has a value– Determined by segment average unit selling price and

average life in field– MIF becomes foundation of quota

• Not all ZBA accounts are created equally– Focus on the accounts with the greatest ROI, with

investment being sales professional’s time• “Territory” = list of MIF and ZBA accounts• MNS quota is developed from technology in field (TIF)

MPS Resources

• MPS specialist target companies with 250+ employees (major accounts) with SME as overlay for <250

• In accounts with fewer than 25 total devices, lease upgrades should be banished as an event

• Use the lease upgrade cycle as your opportunity to perform a study of the customer’s document environment– Mobile has changed how people print– The current hardware environment has probably been in

place for 10+ years, before most of today’s technology was invented

Market Segmentation Benefits

• You get the greatest ROI on your sales investment– You’re selecting where your resources are deployed rather

than leaving it to happenstance• Your sales professionals have a greater opportunity of

achieving success– You know they are spending their time on the correct accounts

• Your sales managers have a defined list to help the sales professional penetrate and expand– The focus is on making progress in each account, a great way

to identify areas to develop each sales professional• You know specifically which clients and ZBA targets

should be targeted for MPS and MNS

Market Segmentation Summary

• A mid-market sales professional can realistically handle 250 accounts– 520 hours/quarter, 1 hour/assigned account, 50% of time

devoted to selling activity• Focus your sales professionals on the accounts with

the highest value to your company– At an average of 3 MFDs/ZBA and a ratio of 80 MIF/ 170

ZBA you have ZBA opportunity of 510 MFD, 2,000 printers, and professional services and MNS wallet share gains

• Provide them with the training and give them a quota for MPS/MNS

Who Buys Your Product

• The decision maker for copiers/MPS– If company < $15M = owner– If company < $40M = owner or CFO– If company < $80M = CFO or CIO– If company > $80M = CIO or Director of IT

• For MNS you almost always want the owner with a strong CFO as distant second

• They have their life’s histories on LinkedIn so we don’t need to drop by to determine who they are

The Sales Formula

• Prospects X average transaction size X close ratio = revenue

• Close ratio has the lowest improvement rate (from X to Y)

• “Prospects” is easiest variable to significantly improve

• Average transaction size can be improved more than close ratio– MPS can increase your average transaction size and

MNS can significantly increase the transaction size

The Sales Formula

[Prospects X 1.5 (50% improvement)] X (average transaction size X 1.2) X (close ratio X 1.1) = 1.98% of original revenue

Driving pipeline growth is the holy grail of sales growth

Account Planning Session (APS)

• Each manager spends one hour per week per rep developing strategy and tactics in accounts that will not close for > 6 months– Start at 5 accounts but once proficient can cover 10 in one

hour• Multiple goals

– Develop more relationships—get higher and wider– Look for tangent approaches—MNS/MPS, software, branch

location placement, application– Increase share of wallet—displace competitors– Increase pipeline so that you grow and gain market share– Develop the sales professional!

Pipeline Management

• If you grow pipeline you will grow your business!• Pipeline measures effectiveness of APS• Three phases for copiers– Phase 1 = 4 – 18 months out (20X quota)– Phase 2 = 31 – 90 days out (10X quota)– Phase 3 = next 30 days (5X quota)

• Three phases for MPS/MNS– Phase 1 = 4 – 9 months out (20X quota)– Phase 2 = 31 – 90 days out (12X quota)– Phase 3 = next 30 days (7X quota)

Success in MPS/MNS

• If you want to know how your program is progressing simply measure your pipeline growth over a rolling 12 month cycle

• Pipeline provides you visibility into future periods and ability to adjust today

MANAGEMENT DRIVES THE CHANGE

How Do Your Core Reps Qualify an Opportunity?

Type of SMB Decision Maker

Type of Partners They Seek

About 20% of SMBs

COMPATIBILITY MATRIX

Sales Deployment

• MNS needs to be supported by SME • In the equipment space the same SME can be

used for MPS and MNS• The equipment sales professional is

quarterback• In major accounts MPS can be supported by

direct sales specialist

Setting New Client Expectations

• Transitioning the relationship to onboarding resources:– Allows sales to refocus on selling– Bridges the gap between sales

and service– Builds credibility and enhances the

client experience

The Quarterly Technology Review

• Provides a report card of delivered services • Response metrics – changes the conversation to

facts rather than feelings• Plan for client’s future – acquisitions, new office

expansions, growth or decline in employee counts

What’s The Future of The Core Rep?• As copier industry matures, there will be fewer

“copier reps” and more “technology reps”• Hire to this model today

so you can transition employees into the new role

• Focus on advanced solutions to continue driving market share gains

It’s all connected

• Hire the correct sales professionals = lower turnover

• Lower turnover = better developed sales professionals

• Territory design ensures fair assessment, good use of time, and ability to sell all offerings

• APS = more prospects (pipeline), ability to expand share of wallet, and sales professional development

• Pipeline measurement = future period visibility and ability to see growth prospects

Pitfalls Of Implementing Better Management

• Pain in change– The fact is that today’s “no management” is easy:

Go cold call and when you find an opportunity I’ll be there for you

– Scientific management requires some upfront work (territory structure) and a disciplined focus to employee development

– Initially, near term results are emphasized over short term results (develop the employee and build the pipeline)

– Managers have to adapt to real management

Benefits of Better Management

• Transition of focus to employee and pipeline development won’t change short-term results

• You’ll recognize the same revenue this month you would have had you not launched the change!

• Sales professionals are held more accountable then before

• They must have strategies for penetration in all accounts in their territory

• They have to prepare for all the meetings, both internal account development as well as customer meetings

• The manager can help them identify opportunities for MNS, MPS and wallet share growth

• They will grow their 18 month pipeline in all revenue streams

Summary

• Strong management is key when launching a new business

• Make certain you call on the correct sized company and the correct level– Focus your sales professionals…don’t hope they find the

correct accounts• Front line manager needs to be change agent using

account planning sessions to educate the sales professional and drive pipeline

• Pipeline is measurement of future growth• You need the correct direct or overlay positions

Summary (cont)

• Core equipment sales professional is quarterback and does initial account qualification

• Spend time to on-board the new client successfully

• Use the QTR to keep clients informed and expand share of wallet

• Hire to the future

Thank You

Trevor Akervik Tom Callinan