| Targeting is the process of selecting high potential | | | | planning (MRP) or the empty cabinet methodology? |
| customer accounts to receive intense sales focus. | | | | What is their ordering practice? By understanding |
| Goal setting translates that high potential into | | | | their process, you can better determine the pain |
| achievable numeric objectives, i.e. revenue and margin | | | | factors and the opportunities to become a hero.D. |
| growth.Each Territory Manager should select a | | | | Vendor PracticesAre they implementing a vendor |
| predetermined number of Target Growth Accounts | | | | reduction program or any other type of program |
| (TGA). Creating focus on this group of selected | | | | that has significant impact on their purchasing |
| accounts doesn't mean a Territory Manager should | | | | practices? What kinds of buyer programs do they |
| ignore other accounts; he is always expected to | | | | have? Are they members of or considering a buying |
| service his entire territory. When making decisions | | | | group? Do they pay their bills on time? Are there any |
| regarding his or her time, however, he or she should | | | | special terms required?E. Special |
| always consider these selected target growth | | | | RequirementsDetermine any and all special |
| accounts a priority.The primary purpose of targeting | | | | requirements such as packaging, receiving |
| and goal setting is to keep Territory Managers | | | | certifications or electronic commerce.F. Becoming the |
| focused on the strategic objective of becoming the | | | | Supplier of ChoiceA current analysis customer profile |
| Supplier of Choice. The Target Growth Account | | | | is the baseline that allows you to understand your |
| platform can be used as a flexible guide to successful | | | | current position with the TGA candidate. It provides |
| growth through targeting, goal setting and action | | | | the starting point of where information will help you |
| planning. | | | | understand the customer's "Rules of Engagement." |
| The Target Growth Account platform reflects the | | | | Look at all opportunities to prove your value as the |
| evolution of the outside sales force from being | | | | supplier of choice. This includes product related issues, |
| primarily transaction driven and self-sufficient to | | | | service related issues and even e-commerce. Keep |
| developing customer intimacy and using team-based | | | | this information current as opportunities come and go. |
| selling. It's the evolution from being a Lone Wolf to | | | | What do they look for in a vendor? What do they |
| becoming a Lead Wolf; it supports growth in | | | | think of you? Who are your major competitors for |
| profitability, revenue and market share!Selecting | | | | this account and what are they doing to win the |
| Target Growth Accounts requires careful thought | | | | business? |
| and substantial effort. Annual sales, margin and goals | | | | These are suggested questions to get you thinking. |
| are established, and detailed action plans must be | | | | Don't stop there; be creative. The more you know |
| created for each of these accounts. For most | | | | about your target account, the better prepared you |
| Territory Managers, TGA's will contribute a substantial | | | | will be to shorten the time required to meet your |
| portion of total territory sales growth. This "big | | | | objectives.G. Customer ContactsA critical aspect of |
| effort for big reward" means that the number of | | | | the TGA platform is the identification of all key |
| TGA's must be limited, and that sufficient time is | | | | contacts. This is more than a contact list. Sometimes |
| allotted to succeed with each one.An account action | | | | just obtaining this data can be an adventure and a |
| plan ensures that the Territory Manager is proactively | | | | learning experience for your sales force.H. Decision |
| pursuing sales growth and that there is a solid basis | | | | MakersSome portion of the contacts identified in the |
| for expecting account goals to be met. By monitoring | | | | previous section should be considered "key decision |
| these action plans, both the Sales Manager and | | | | makers" in your customer's organization. They are |
| Territory Manager can manage activities rather than | | | | the people who heavily influence the buying decision |
| wait for results. | | | | or heavily influence those who make the buying |
| In short, the Target Growth Account platform | | | | decision. These people deserve special consideration. |
| provides:* Focus* Process* Best Practice Discipline* | | | | You should understand the opinion that each key |
| AccountabilityThe Territory Manager needs to submit | | | | decision maker holds about their critical needs from a |
| a predetermined number of target accounts that | | | | supplier and what it takes to become supplier of |
| have a high potential for growth with a high | | | | choice.I. Competitive ProfileWho are your customer's |
| probability for success. These accounts are approved | | | | major competitors? How do they sell against them? |
| by the Sales Manager and become the focus of the | | | | Why do their customers choose them? What is their |
| Territory Manager and the Sales Manager. This | | | | competitive advantage?J. Key Questions:o What |
| account selection should include a number of | | | | would their customers say that they really value |
| prospects that are currently doing very little or no | | | | from your customer?o What are your TGA |
| business with the company. This will keep the | | | | customers' key skill sets, i.e. what are they really |
| account pipeline full. Every salesperson loses accounts. | | | | good at?o Who are your customers' major |
| Without the development of prospects, eventually | | | | competitors?o How is your customer positioned in |
| the pipeline will run dry and the territory will shrink | | | | their market?K. Customer RequirementsCustomer |
| and lose market share. Individual sales goals are | | | | requirements are all of the specific criteria that you |
| established for each of these accounts and agreed | | | | must meet to do business with a customer. Often, |
| upon by the Territory Manager and the Sales | | | | these are mundane issues like payment terms and |
| Manager.The intention of planning and goal setting is | | | | quality certification. Think of these as the hurdles that |
| to provide focus on Target Growth Accounts. These | | | | you must clear in order to be a qualified supplier to |
| are the accounts with the most potential for growth. | | | | your customer. The rules of engagement identify the |
| This doesn't mean the Territory Manager now only | | | | conditions that are necessary for your company to |
| has a limited number of target accounts. He must | | | | win the business. Consider them to be the minimum |
| continue to service his entire account base. These | | | | qualifications. |
| are target accounts that have high growth potential | | | | Your Territory Managers must identify these |
| and have been identified to receive a proactive, | | | | requirements for each of their selected accounts. |
| aggressive focus for growth.Managing the TGA | | | | Although they are most important for prospects, you |
| PlatformA Sales Manager has many competing | | | | may be surprised to find what you will uncover during |
| priorities. One of the most important is the need to | | | | your investigation for existing customers. You may |
| manage the sales functions. The TGA planning and | | | | find that your existing business is at risk because you |
| reporting platform and the various activities which are | | | | are not currently satisfying their minimum |
| a part of it are intended to help the Sales Manager | | | | requirements!The following is a partial list of the |
| improve sales management skills.From a management | | | | typical areas in which rules of engagement are |
| perspective, the goal of TGA is to improve the | | | | enforced:* Inventory requirements* Credit terms* |
| quality of the targeting, goal setting and action | | | | Payment terms* Return policies* Contract pricing* |
| planning efforts of your salespeople. Its primary | | | | Quality programs and certification* Integrated supply* |
| purpose is to provide focus, process and discipline | | | | Special shipping and handling* Drop ships EDI - |
| that will enhance territory performance. This | | | | Internet communication capability* Credit card sales* |
| enhancement will lead to an increase in the sales, | | | | Training* Strategic alliances* Consignment Frequency |
| profitability and market share for each individual | | | | of vendor communicationsStep 3: Define GoalsAfter |
| territory. The process itself becomes an effective | | | | the Territory Manager has selected his targets and |
| sales management tool.An initial TGA territory | | | | collected critical profile information about them, it's |
| meeting between the Sales Manager and the | | | | time to quantify goals. For each TGA account, the |
| Territory Manager is the most important step in the | | | | Territory Manager should now define goals for sales |
| TGA process because this is where the company's | | | | revenue, sales gross margin and potential product |
| expectations of sales performance are defined. This | | | | objectives. The first item to be considered is exactly |
| meeting creates territory dialog that is essential for | | | | where you stand as a supplier or potential supplier |
| effective sales management ,support and knowledge | | | | right now.Served Available Market (SAM)The first |
| transfer. Each Territory Manager should prepare by | | | | step is to quantify the potential for each TGA |
| organizing some key information for each of the | | | | account. Total available market, less other channel |
| TGA accounts selected.The Steps of the TGA | | | | supply that you do not participate in, equals Served |
| PlatformThe major steps in the targeting, planning | | | | Available Market. This is the true potential revenue |
| and goal setting process are depicted in a description | | | | that you have the opportunity to go after. Just |
| that follows for each.Step 1: Account SelectionThe | | | | because the customer buys a total of $XX does not |
| TGA platform is intended to increase the focus of | | | | mean his total purchase is realistically available to you. |
| your sales effort on the kinds of specific activities | | | | We have now entered the age of multi-channel |
| that will lead to growth in sales, margin and market | | | | distribution. Your SAM must represent a large |
| share. Before these activities are precisely defined | | | | potential with a high confidence for success to |
| for the TGA platform, the Territory Manager must | | | | warrant engaging the resources necessary to capture |
| select his Target Growth Accounts and review them | | | | the account. This candidate should match the abilities |
| with the Sales Manager. Target Growth Accounts | | | | of your company to perform. You must understand |
| should be selected on the basis of their potential | | | | and be capable of performing under this customer's |
| dollar growth.Careful selection of TGAs is obviously | | | | requirements, or their "Rules of |
| critical for the success of all subsequent efforts. | | | | Engagement."ForecastTerritory Managers should |
| Selection must be based on unfilled "real potential." | | | | forecast sales revenue, sales gross margin and sales, |
| Territory Managers should explain their rationale for | | | | by product line or vendor monthly. This is not "pie in |
| their selection backed up by data justifying that | | | | the sky" guessing. They should be able to back up |
| selection.Step 2: Customer ProfileWhen a customer | | | | their forecast with solid data and a reasonable |
| makes his buying decision, he does so based on | | | | thought process. In other words, why and how do |
| certain assumptions, perceptions and expectations. | | | | they feel they can accomplish this goal? Note that |
| When the customer places an order, these | | | | these forecasts should be revised based on the |
| assumptions and/or perceptions become reality in the | | | | action plans developed in the next step.Step 4: |
| customer's eyes. Your failure to understand these | | | | Action PlansThe action plan is the plan of attack - the |
| assumptions and perceptions often leads to costly | | | | steps that will enable the account to reach its goal. It |
| misunderstandings, resulting in a disappointed | | | | should develop naturally from the knowledge the |
| customer. The key to avoiding these | | | | Territory Manager gained from his research and |
| misunderstandings is to get the "book" on the | | | | customer contact. A detailed action plan should be |
| customer. Only by understanding his needs, | | | | developed for each target account. Of course, the |
| perceptions and expectations can you avoid | | | | plans for accounts with which you currently do |
| misunderstandings.Remember:* The customers' | | | | business and have relationship equity may be more |
| perceived value of your company drives their | | | | extensive than those for newer prospects. This |
| expectations* Your company's performance value | | | | action plan determines how to match your company |
| drives your customers' satisfactionGetting the "book" | | | | resources to every opportunity that exists within |
| on the customer means defining the customer profile. | | | | that account.Each task in the plan includes three |
| It contains information about the internal workings of | | | | critical elements: a "deliverable" or result that the task |
| your customer, including everything from the | | | | will produce, an owner responsible for the task, and a |
| company's history and ownership to its day-to-day | | | | due date. Defining a clear deliverable ensures that |
| ordering process. Territory Managers should complete | | | | you are not confusing motion with progress. You |
| a customer profile for each of the accounts that | | | | must be clear about what you are trying to |
| they have selected. E-mail This email address is being | | | | accomplish in each step to be sure that the overall |
| protected from spam bots, you need Javascript | | | | plan will produce the desired result. Deliverables are |
| enabled to view it for a sample customer profiling | | | | the difference between passive forecasting and |
| form.The customer profile is the core of the TGA | | | | active planning. |
| platform. Each profile element becomes a building | | | | The owner of the task is the person responsible for |
| block in the program's foundation. Without good | | | | its completion. This is not necessarily the person who |
| dialog with target accounts, securing the information | | | | will do all the work involved. Each participant in the |
| necessary to formulate a meaningful action plan | | | | plan must acknowledge and accept responsibility for |
| becomes very difficult. To ensure maximum benefit | | | | his portion of the plan.Task owners could include:* |
| from the information collected, the questions asked | | | | Inside sales* District Manager or Regional Manager* |
| and the answers given should be documented. This | | | | Vice President of Sales* Credit and collections |
| allows both the Territory Manager and the Sales | | | | personnel* Operations manager* Branch manager* |
| Manager to improve their knowledge of the account. | | | | CEO in special casesDefinitive action plans are more |
| Suggestions for getting the information needed | | | | than personal account visits once a month. They are |
| include:* Analyze internal historical data* Do outside | | | | more than introductions to upper management and |
| research on the customer's industry* Ask the | | | | they are more than a commitment to work with |
| customer directly* Develop a relationship with the | | | | management to submit the lowest bid. Action plans |
| gate keepers* Use the internet to research the | | | | must be precise, definitive and measurable. They |
| industry and the customer's customer'sUnderstanding | | | | could include tasks for getting specific customer |
| the customer's market and business is necessary to | | | | information, introducing new product lines, entertaining |
| develop a plan for growth. You need this intelligence | | | | key players, etc.Do not make the mistake of putting |
| to determine and allocate the necessary resources. | | | | all your energy into your largest accounts. This is |
| You need to understand your customer's business in | | | | especially true when you are getting the majority |
| order to understand how to meet his needs, cure his | | | | share of spend from that account. Remember, the |
| pain and sell to him. Understanding his business | | | | TGA process focuses on the greatest potential for |
| involves knowing his markets, customers and | | | | growth. |
| competition. The market profile is used to gain | | | | Instead of simply learning to "do what we have |
| knowledge of your customer's customer. In which | | | | always done a little better," we need to become |
| market segments do they participate and what is | | | | aware of and practice understanding that involves |
| your customer's strategy for growing market share? | | | | re-examining everything we do - including how we |
| This requires serious discussions with numerous | | | | think about our customers and our role in their |
| people in your customer's location. You will define the | | | | future.This often means letting go of our existing |
| key players and your contact points on the customer | | | | knowledge and competencies, recognizing that they |
| profile tracking form.Areas to explore include: what | | | | prevent us from learning new things. This is a |
| types of markets are they in? Are their markets | | | | challenging and sometimes painful, but ultimately |
| growing or shrinking? What is their market share? | | | | rewarding, endeavor.Step 5: Track ProgressProgress |
| Are they exploring new markets? What types of | | | | on TGA action plans should be tracked, and specific |
| customers are they after? Who are their major | | | | TGA discussions between the Territory Manager and |
| customers? How do they generate new business? | | | | the Sales Manager should occur on a regular basis. |
| What is their large to small customer ratio? Who is | | | | The Territory and Sales Managers should also discuss |
| their competition? What price or profit pressures are | | | | and update the action plans where appropriate. A |
| they experiencing?This helps you get a better | | | | Territory Opportunity Action-planning Discussion |
| understanding of their business. By understanding | | | | should occur on a regular basis (monthly is |
| their types of customers you will be able to | | | | recommended) to monitor results and make the |
| determine the timelines from order to delivery. What | | | | appropriate course corrections.Targeting for growth |
| is their ordering lead-time? What could be done to | | | | is not a complex process. It is built on best practice |
| shorten the cycle time and perhaps determine what | | | | sales principles. However, commitment on the part of |
| your customer's pain factors are?A. General | | | | the Sales Manager and the Territory Manager is |
| Information ---A Customer OverviewThis provides an | | | | essential to success. The WIIFM (What's In It For |
| important snapshot of the TGA account. It tells you | | | | Me) is simple: MORE MONEY.Effective targeting |
| exactly what kind of company you are dealing with. | | | | produces growth in revenue, profits and market |
| Areas to explore include: when were they founded? | | | | share. Such growth increases sales incentive and |
| How did they get started? Is it a partnership or sole | | | | enhances performance. Improved performance leads |
| proprietorship? Is their family involved in the | | | | to more money for both the Territory Manager and |
| business? Where are they headed? Do they have a | | | | the Sales Manager.Dr. Eric "Rick" Johnson () is the |
| strategic plan? What are their growth expectations? | | | | founder of CEO Strategist LLC. an experienced based |
| Who are the principals of the company? What are | | | | firm specializing in Distribution. CEO Strategist LLC. |
| their demographics as it relates to their market, their | | | | works in an advisory capacity with distributor |
| office locations? What is their current and forecasted | | | | executives in board representation, executive |
| revenue? How many locations and employees do | | | | coaching, team coaching and education and training to |
| they have? What is their sales and margin split | | | | make the changes necessary to create or maintain |
| between products and services? What is their | | | | competitive advantage. You can contact them by |
| financial condition and credit rating?B. Products and | | | | calling 352-750-0868, or visit for more information.Rick |
| ServicesWhat kinds of products and services do they | | | | received an MBA from Keller Graduate School in |
| sell? Are their products and services seasonal? Do | | | | Chicago, Illinois and a Bachelor's degree in Operations |
| their products and services go through sales | | | | Management from Capital University, Columbus Ohio. |
| lifecycles? If so, how long do they last?C. Buying | | | | Rick recently completed his dissertation on Strategic |
| ProcessWhat is their inventory control process? Do | | | | Leadership and received his Ph.D. |
| they buy based on forecast, material requirements | | | | |