A Shark Tank Lesson for the Ag Sales Professional

Territory Management Lesson #1 for the Ag Sales Professional

Who’s Your “Wal-Mart Customer” and do you really want to sell them?

Who’s your Wal-Mart Customer?  What does that mean?  It means, who is the biggest prospect in your market.  For the Ag Sales Professional, it often means the biggest land owner in your territory or that giant livestock producer in your market.  Maybe it’s one of the large agribusiness companies that you are trying to get product into.  We all have one in our geography.

The question is – Do you really want to sell that account?  You might answer, “Well Greg, I sure do!  What kind of question is that?  I dream of signing them up and never working another day in my sales life.  Big volumes, commission checks and I’ll be set.”    That sounds wonderful, except these are often naïve dreams of someone that may not understand all of the challenges.

A Recent article by Howard Love titled “Dancing with Elephants” explained the challenge of selling a large account.  Especially if you are new to sales or the company.  Why?  Mostly, he explained the limited possibilities you have once you are connected to an account of this size.  Don’t get me wrong, we all want to sign a big account.  You get a lot of volume, revenue, opportunity and certainly credibility goes along with signing the big account in your territory.

New Sales person overly concerned with the account – I have seen where a sales person gets so infatuated with trying to sell the big account that it consumes their life.  They are so busy swinging for this big home run that they drive right by a lot of singles and doubles on their way to selling their Wal-Mart.

Complex Account – These accounts are typically not your easiest of accounts to sell.  They often require lengthier sales cycles and have more complex buying patterns. Again, for the new person out selling, this can be frustrating as they aren’t up to the challenge of uncovering how to sell an account this size.

Customized Products & Services – These accounts are big and they may want to use that size to their advantage.  They might want their own products to be unique in the market.  They may also require additional services that will challenge your companies’ ability to service the account.  This further delays the buying process and challenges your margins as these services aren’t free for your company to provide.

Reduced Margins – This is pretty standard and understood.  The more you buy, the lower the price.  If they push too hard on you for price concessions, will you even be profitable if you do sell them?  Don’t forget to subtract out all the costs of customizing, extra services, increased inventory expenses, return policies, etc.  As mentioned, these aren’t free to provide.

To understand some of my points here, watch a couple episodes of Shark Tank.  It is one of those shows on TV that you can actually learn from.  It’s interesting to see how venture capital is discussed and invested.  I know there are some silly things that get pitched on the show and some nonsense for ratings.  However, there’s some underlying messages.  One piece of advice they often give to the budding entrepreneurs is to “not” go into Wal-Mart or the other large retail chains.  It’s mostly based on where the startup company is in their development.  Too early and it can crush a company.  The factors mentioned above are a few of their reasons.  The Sharks will sometimes recommend to the entrepreneur to continue their current approach for now – on line sales or small shop retailers, etc.

There certainly is a time and place to go after an account this size.  Timing is critical.  You may only get one chance.  Selling them too soon in your sales career or your product’s life cycle might be a mistake.  Take your time and do your homework.  Involve all components of your business before making the move.  They certainly can be profitable and important to your business.  Just go in with a clear understanding of how to add value to the customer’s business and make a return for yours.

 Join me tomorrow morning for some solid insight in handling price resistance on your next farm call.  Click on the link below

Make your next meeting memorable by bringing in a speaker who’s been there.  Contact me to find out how Greg@GregMartinelli.net

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