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Primo Industrial Supply recently faced firing because it did not have the lowest price on a particular product. We asked what you would do in Primo’s situation and how sales manager Kevin Fitzpatrick could persuade his salespeople to sell value over price.

Fictitious distributor Primo Industrial Supply was recently notified by a customer that it could be fired because a competitive distributor offered a price discount on the product Primo provides. As a value-added distributor, Primo was somewhat taken aback by this.

Primo sales manager Kevin Fitzpatrick had some tough decisions to make. We asked you what you would do in this situation.

Responses varied between retraining the sales force to firing the sales force to working with suppliers. But one common thread remained: Distributors must do whatever they can to promote their value to the customer instead of price.

Ask and you may receive
Rod Vese, director of marketing for SourceApp.com, said each Primo salesperson should focus on proving his value as a problem solver. SourceApp.com provides an avenue for industrial suppliers, distributors and customers to work on cost-cutting activities in a secure online environment.

Vese said he would ask each of his salespeople to bring him two customer applications problems. He said the customer needs to be reasonable and give the salespeople applications problems that can be improved with some technical skill.

“The salespeople may even suggest certain applications, based on their knowledge of their customer’s business,” he says. “For example, if Primo carries Allied Spade Drills, the salesperson may want to ask for deep hole close tolerance drilling applications, because spade drills often provide an easy, effective solution to drilling issues.”

When asking for applications to work on, the sales team could carry binders of test results/cost savings they generated for other customers. This often creates a feeling of trust and anticipation from the customer, Vese says.

Step-by-step
In order to show customers value means more than price, distributors need to have a plan of action and stick to it. Bob Cook, area manager for MRO electronics distributor Carlton-Bates, shared a 13-step process he says works for him.

1. Understand the people and functions within the plant.
2. Ask how they are measured.
3. Ask what are some of the typical problems facing them.
4. Ask what possible solutions you can propose to address these problems.
5. Ask what successes and failures your top suppliers experienced on the plant floor.
6. Hold a strategy meeting with a few of your suppliers to discuss potential opportunities for bringing a multi-product solution to the problems.
7. Set an agenda that includes key people from your suppliers.
8. Organize a meeting with the key people at the customer’s location.
9. Deliver a presentation that justifies why the customer should take time to listen.
10. Set a time for a future plant/location tour.
11. Recap the meeting.

Once you get out on the floor, it is important to document anything you find, making note of solutions that would be successful and eliminating solutions that would not work.

12. Share the experience with other sales team members.
13. Keep building on what is working and work on areas for improvement.

If asking for applications problems or hauling a binder around with you doesn’t work, Vese says it’s time to bring in reinforcements. He says it often helps to “bring an engineer” to the customer to help with applications.

“It may or may not actually be an engineer, but the person brought in must be valuable to the customer in terms of technical expertise and problem-solving ability,” says Vese. “When the customer realizes he is special because an engineer has come to his plant to help, the door may be opened.”

Review and retry
Larry Hicks, branch manager for industrial MRO distributor Arkansas Mill Supply, says he would suggest a review of a “Who Bought What” list and target one or two high-volume items that Primo already supplies a customer and come up with some alternative products to test.

“Make sure you involve factory reps, where possible,” says Hicks. “Try and cover all the bases on products to test for that application. More than likely you will have one opportunity, so make the best of it.”

Hicks says Primo should have the information it needs to document cost savings from the Who Bought What list. He says it’s important to present anticipated goals and possible solutions to the decision maker. If your goals and savings intrigue the decision maker, schedule an initial documented test.

“You will develop credibility with your customer by attempting to provide a better or more cost-effective product at the expense of your sales,” says Hicks. “If you are successful, you will lower your sales volume on those particular items, but should open other opportunities elsewhere in the plant and gain a better customer.”

New beginnings
Sometimes, getting through to the customer requires new salespeople. Andrew McLellan, account manager for Canadian industrial distributor Acklands-Grainger, says if Primo salespeople are having difficulty getting on the shop floor, perhaps he should hire new salespeople.

“Fitzpatrick’s salespeople are obviously not making the sales calls and as a result they have not established the credibility and the relationships needed to be considered a trusted business advisor,” he says.

McLellan says salespeople need only basic selling skills to get on the shop floor. For example, simply asking a customer for a plant tour is a good start.

Above all else, they will need consistency and determination in their approach to selling value, he says.

“This helps establish trust and builds relationships with customers,” says McLellan. “Once they have established relationships and can be trusted by their customers, getting on the shop floor is easy.”

What would you do?
Fictitious distributor Primo Industrial Supply's sales manager Kevin Fitzpatrick has a problem. After more than a year of mandating value-added selling, his salespeople are beginning to see the value in it. But, they still do not know how to best prove their value to customers. What are some methods Primo's salespeople can use to prove their worth to customers?
Click here to weigh in on this difficult issue.