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Issue Date: Vol. 43, No. 5 / May 25, 2003 - June 24, 2003, Posted On: 5/25/2003


Top Salespeople Compare Notes On Selling In Today's Marketplace At NBPA Convention


Tim Sanford
Editor@vendingtimes.net

ATLANTIC CITY, NJ - The strategies for success developed and employed by top industry sales executives were explored during the National Beverage & Products Association annual convention here.

Len Rashkin, Len Rashkin Consulting (Bellmore, NY) moderated a session featuring panelists Ed Baggesen, Atlantic Coffee & Provision (Marshfield, MA); Kevin Bush, sales consultant, Aramark (Philadelphia, PA); Richard Karsay, president of Karsay Coffee (Somerset, NJ); and John Merlo, regional sales manager, Allied Office Products (Clifton, NJ).

Baggesen joined Atlantic in 1999. He has been that company's top sales producer in each successive year, bringing in annual revenues of $400,000 to $500,000 annually in new business. His experience includes a quarter-century with the Marriott organization.

Bush joined Aramark in Atlanta, GA, and was advanced to the tough Philadelphia market a year later. Essentially building a new sales organization there, he started to ascend in the sales rankings, attaining "Vice-President's Club" performance in 2002.

Merlo, a sales veteran with two decades' experience, has served as Allied's New Jersey regional sales manager, Coffee & Beverage, for the past seven years. His division currently does $18 million in annual OCS sales.

Karsay joined the family business in 1987; it was founded by his grandfather in 1950. An innovative OCS operation which generates about a third of its sales from office, a third from foodservice and a third from healthcare, Karsay Coffee also provides point-of-use water treatment systems. It enjoys annual sales of about $2.5 million.

SALES TRAINING

Rashkin led off by asking the panelists about the coffee service sales training they received.

Bush replied that he underwent Aramark's "Grounds Up" course of instruction. Merlo went through a two-week training program. Baggesen received two weeks' on-the-job training, running a route with an experienced sales representative.

Karsay recalled, "They gave me the keys to a van and said, 'Go build a route!' You can get good training from  product suppliers, like Green Mountain and Lavazza, and from manufacturers' representatives. Go out into the field with them," he advised.

The moderator then asked the panelists to describe a typical workday.

Bush explained that he usually begins by calling prospects to set up appointments. After lunch, he conducts approximately 10 sales calls and customer visits, then returns to the office to return phone calls and answer e-mail messages.

Merlo reported that his plan, which almost always is modified in practice, is to travel around his territory to visit existing clients, "put out fires" if necessary, and call on prospects.

Baggesen endeavors to start the day with a few cold calls and follow-up visits. "I always try to get two appointments a day, even if they're call-backs after an initial contact," he said. After returning to the office to turn in his paperwork, he sets out to make more cold calls and/or follow-up visits. "The period between 4:30 PM and 5:00 PM is the best time to reach decision-makers," he explained.

PLANNING THE WORK WEEK

Karsay pointed out that not all days are structured the same. "I schedule one day a week to clean up all my 'Post-It' notes and callbacks, and another to concentrate on going out and simply prospecting," he told the audience. "It's hard to do, but you have to do it."

Rashkin observed that the weak economy is driving workplace refreshment companies to strive to add more new accounts and to sell more in existing stops. He asked the panelists what they are doing to accomplish these goals.

Bush replied that it is especially important now to talk to clients and explain how the service provider can help them budget for a coffee service that will maintain and build staff morale. "And I go after referrals, more than ever," he added. "This is the most honorable way I know to get new business."

Merlo also focuses on the role of a professional refreshment service as a provider of a tremendous employee benefit, at very modest cost. "Why, when the economy weakens, is a 10 cup of coffee the first thing they want to cut out?" he wondered. "We try to give them information, explain their options, introduce new products to them, and generally help them get the most value out of their programs. We offer specials; we constantly talk to our customers."

Baggesen concurred. "The first thing I say nowadays is, 'I want to save you money,'" he explained. "If they'll work with me, I often can do this; I can show them how to save." His company also has a well-designed program to encourage referrals, and rewards clients instrumental in getting new business with "Atlantic Bucks" coupons, which are redeemable for product purchases.

Karsay reported that the current economic conditions have led his company to slow down in order to take a close look at the business, to consider what has worked and what has not, and to clean up its account roster. Some clients, he noted, tend to "fall through the cracks" and the situation must be rectified. Most can be studied with an eye to finding specific ways to sell more to them without additional cost of sales.

"Right," Rashkin said. "A good operator can save money for his customers without cutting prices, by reducing waste and enhancing productivity."

In a general discussion of the responsibilities given to sales personnel for ongoing customer relations, the panelists explained that Aramark and Atlantic run separate customer service units, so their sales forces can concentrate on selling. Karsay endeavors to stay in touch with all his clients, and to sit down with each of them (approximately 600) at least once a year. "The sales representative is a relationship builder," he emphasized; maintaining those relationships will be handled differently by large and small organizations.

Baggesen agreed. "You have to listen to your customers," he emphasized; whoever gets this job must do it attentively. "You have to listen to them, understand their concerns and answer their questions," he urged.

Merlo added that product knowledge has never been more important than it is right now. "You must let your customers know that you know what you're talking about," he insisted. "And you have to adjust your personality 'on the fly,' to make every client feel comfortable."

Bush observed that a relationship needs to be understood correctly. If it is, "They'll tell you what they want. They need to believe that they're dictating the service."

Rashkin asked for specifics on landing new accounts.

"Referrals," Karsay reiterated. "Make sure your company name, your telephone number, your logotype are everywhere. Make it easy for prospects to get in touch with you. Telemarketing is great in new markets, to open up new areas or to introduce new services; it can open doors for you. On the other hand, you can't really do true cold-canvass selling anymore." Some operators have reported good results from participation in local trade shows that attract the desired clientele, he added; he has not done a great deal with these.

Baggesen observed that his company's reputation generates a lot of leads, and he has been successful with trade shows. This partly is conditioned by the market area: "There are a lot of colleges in New England," he instanced. "If you can become an 'approved supplier,' this can get you into their various departments."

He added that he currently is engaged in revisiting all the locations he did not get over the past three years.

CROSS-MARKETING

Merlo noted that Atlantic has an office supply division and a capable telemarketing force, and the sales personnel in each are valuable in generating leads. "You can't cold-canvass in New York City," he added. "But we can do 'sales blitzes,' arrange demos, hand out flyers..."

Bush reported that Philadelphia is a market with the same kind of constraints on cold-calling. "But we can encourage people to speak with family members and friends," he said. "Everyone knows someone, and everybody buys something!"

The moderator asked whether the panelists set goals for new accounts, and what they regard as the average time required to follow up a lead, land the account and install the equipment.

Karsay replied that he aims for 50 to 100 accounts annually. Some of these are coffee service plus foodservice, others coffee service and institutional supply, and they are not strictly comparable. Two of 10, on average, are brought in through telemarketing. "Following up a referral requires one or two sales calls in order to close," he added. "As for cold calling, you can't do it anymore."

Baggesen wants 100 to 150 new accounts per year. The time to close, he reported, depends on the size of the client and the initial contact; referral business takes much less time to close.

"In a large account, there are four or five levels of decision-making, and it may take you three to five weeks to work through all of them," he pointed out. "But it pays off." By contrast, an account with 40 people should be closed with no more than two sales calls.

Merlo observed that his company, with its large sales force, expects 300 new accounts per year. "We want new sales people to close two accounts per month, with various products. Our coffee sales staff should bring in 10 a month, and we've done that."

In large accounts, he said, an average of five people tend to be "information gatherers" who, if satisfied with the information they receive, provide access to the decision-maker. This can seem a tedious process, he said, but doing it well and thoroughly will produce an account that remains loyal.

Bush noted that his objective includes a sales figure. "I want $500,000 in volume," he reported. "I want half of the 'top 20' accounts in my market each year."

Rashkin asked how the panelists target new prospects to pursue.

"I read the business section," Bush explained. "Who's making headlines? Who's hiring, and who's downsizing? And I 'leverage' business whenever possible , go to our local suppliers and say, 'We buy from you; will you buy from us?'  You buy all sorts of things locally."

An audience member asked whether the panelists have had any luck with mass mailings or their electronic equivalent, the "e-mail blitz."

Karsay reported that he has not had good results with mass mailings in general, although they can produce results when used to promote a specific new product or service.

Baggesen added that it is necessary to assign someone specifically to follow up a mass mailing, or any potential results it generates will not be translated into business.

Another operator asked what, specifically, motivates him.

Baggesen explained that Atlantic's ownership provides ample motivation through its flexibility and attention. "They talk to you, they listen to you, they help you, and they give you a lot of leeway," he said.

A third question involved the literature, especially sales handouts, that has proven effective.

Merlo replied that his organization has its own printing department with the computer graphics software needed to turn out whatever material is appropriate, notably a 16-page catalogue.

Baggesen reported that he is fortunate to work with an outstanding marketing program, including an attractive brochure and a detailed, informative price-list.

Rashkin, an industry veteran who has built a reputation over decades for imaginative, effective marketing concepts, noted that there is an ongoing controversy about the correct way to prepare presentation material. "Should you include prices, or should you not? There's no correct answer," he said.

An audience member wanted to know how salespeople are compensated.

A combination of salary and commission is the common package, the panelists explained. Bush observed that a good sales representative can earn a $30,000 to $40,000 salary, plus a commission calculated on the basis of 13 weeks' sales: 50% of gross profit for a top-level account, and 20% for one at a lower echelon.

Another seminar-goer asked what latitude is given to salespeople in quoting prices.

Bush explained that his company uses a "pricing matrix," and identifies four tiers of clients. Placement in one or another tier depends on the number of kits sold and the employee population.

"Are 'blitzes' really successful?" an operator inquired.

CAPACITY FOR TAKING PAINS

The consensus was that a "blitz" can be effective if it is carefully organized and administered. "We bring in top managers from all over, and we have detailed follow-up of everything that was discussed," Merlo said. "Yes, it's successful. It's a real pain in the neck, but it works."

"How do you measure a sales representative's success? Do you set a monthly gross profit goal?" another audience member wondered.

Bush explained that a minimum limit is set. For a new hire, this might be $1,000 in gross sales generated over a month (or a specified number of weeks); that minimum increases to $3,000 or $4,000 as the salesperson gains experience. The calculation is based on a gross profit average of 50%.

Rashkin reiterated the point that coffee service is a "relationship" business, and asked the panel to what degree they go in learning their customer contacts' interests, birthdays, childrens' sports involvement and so on.

"You do what you have to do," Baggesen replied. "Some people will share this kind of thing, and you get to know them well. Others are all business, and you respond to that."

Bush emphasized that the sales representative needs to know what clients do. "You will talk to them; you have to converse , listen! And, if you do, you'll learn what you need to know," he said.

Karsay allows the individual to set the framework of the relationship. "I don't ask them anything specific; I find out what they want to talk about," he noted.

"What's your policy on holiday gifts?" Rashkin asked.

"Salespeople can give gifts, but the company does not," Merlo replied.

"We try to stay away from that," Bush said. "We send a card."

"Sure; send them a gift, or play golf with them," Baggesen suggested.

A seminar-goer pointed out that a perennial challenge in OCS selling and account retention is "depth of contact level." He noted that, in accounts of any size, there are echelons beyond the initial tiers with which the sales representative has dealt. These dealings culminate in meeting and convincing a decision-maker. "But suppose the upper management team changes, although your decision-maker does not," the questioner proposed. "You don't know that tier, nor can you predict what the new people will do. What can we do about this?"

"Yes; that happens," Merlo agreed. "You want the person you talk to when those top-level changes are in the works. You try to 'penetrate' the account and find out who's influential."

Karsay also agreed that the question is a good one. "When I was building a referral list, my idea was to find out who was the boss and get that person on it, whether the customer was large or small. The boss, not just the decision-maker. It takes work, and you can't always pull it off," he recalled. "But it can get you to the top tier, even if you don't use that referral list!"

Rashkin agreed that a well-researched referral list can be an extremely useful tool. At a minimum, he said, this should include the client type as well as name, title and telephone number. Using such a list for its intended purpose, he said, one can call up a telecommunications company and cite the other telecommunications companies (if any) that the operation already serves.

"How do you manage a prospect and customer database?" another operator asked.

Merlo replied that his company uses an Internet subscription service, salesforce.com. Leads are typed in every night, and reports are generated monthly. (The website can be visited at salesforce.com/us/.)

Aramark has database management software, Bush said; among other things, it tracks every call made by sales representatives, as well as their successes.

An audience member asked whether any of the panelists belong to a "networking association."

Rashkin said that he has participated in such groups, which exist primarily for sales personnel to exchange leads, during his long career as an operator on Long Island. "It was very successful for us," he reported.

Merlo noted that his sales personnel belong to these, and he has been a guest at several functions that they put on. "It does succeed," he reported.

Bush noted that he may have looked at the wrong ones, but the ones he has seen were not worth the effort.

Karsay agreed with that judgement. "In my experience, you can spend 71/2% of your time to generate 2% of your new business," he said. "It's not time well spent."

RECIPROCAL RELATIONS

Another approach to networking was the subject of another question: "Does anyone use 'affinity' programs? That is, a formal method of arranging a quid pro quo with, say, a moving company or a human resources organization, under which you each become part of the other's client presentation?"

Merlo said that he has such arrangements with some architectural companies and consulting firms.

"What is the sales representative's responsibility after the sale?" someone asked. "Someone has to follow up, to resolve issues as they arise. Do you do this? How is the salesperson compensated for account maintenance?"

Merlo replied that his company handles this on a commission basis; if volume increases, the sales rep's compensation increases too.

Rashkin added that someone must be assigned to asking clients for endorsements: letters praising the service in general, or a particular salesperson. "You'll find that a satisfied customer isn't hostile to the idea, but often will tell you, 'I hate to write letters'. Your job then is to say, 'suppose I draft one for you; you review it and change it if you wish?'"

By the same token, he added, it always is worthwhile to ask whether the client is satisfied with the service. For one thing, if there is a problem, it is advisable to get it out in the open and fix it. For another, if the client does express satisfaction, the sales representative can follow up and ask, courteously, for a referral. "Don't push it, but do ask," he advised. "They'll usually agree."

An audience member reported that he thanks people specifically for granting him an appointment. "I thank them for seeing me; I send letters. I send letters thanking customers for their business. How do you use e-mail for this? Does it work?"

Merlo said that his concept is to have the sales representative e-mail thanks of this nature to existing accounts. "Some clients don't like it; many do," he reported. "It does seem to work for a lot of operators." Management software is available to prompt the sales representative to do it, then tracks the process. "We haven't done much with e-mail for new account prospecting," he added.

An audience member took gentle exception to the majority view that cold canvassing is obsolete. "I love to make cold calls," he said. He explained that his wrinkle is to fill his pockets with candy from Masterfoods USA (known to millions as Mars), make a call and introduce himself to the receptionist as "Ray from Mars" and offer him or her a snack. "This breaks down their defenses and makes them laugh," he reported. "Then they'll tell you whom to talk to."

Rashkin asked the panelists to suggest their response to a question from management, "What must we do to make your lives as salespeople easier? What do you want us to do for you?"

Merlo agreed that management must back up its sales personnel, resolve issues for them and rectify problems that arise. "When you've done that effectively, you have the right to ask, 'OK, I did it for you; what have you done for me?'"

"Salespeople want pricing flexibility," Baggesen added.

"They want support from management through genuine cultivation of a team spirit," Bush noted.

"Why do sales people fail?" the moderator wondered.

"Mostly, they lose the discipline needed to keep working to fill up the pipeline," Baggesen suggested. "You have to keep pumping yourself up to go out and do it."

"Yes; you need a reserve," Merlo agreed. It can be fun; he agreed with "Ray from Mars" that cold-calling can be effective, and pleasant, if the salesperson always brings a small present: "Maybe an orange; anything that you can give them." This sort of thing can combat the sales representative's natural, fatal tendency to coast, to become comfortable and complacent. "You always have to have five or six accounts pending; you  need to have that reserve, and to keep adding to it."

"Right," Bush concurred. "My job is to never let the funnel run dry , I have to keep getting sales leads and developing them. You can't take a week off from that! There's a lot of freedom in 'outside sales' and management has to know what people are doing out there."

"What problems does the independent operator have?" Rashkin asked Karsay.

"You wear many different hats,"


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