History of the Problem
When the planet's first merchants were in business, competition was scarce. There was one butcher, one baker and so on, per small village. As villages grew and became cities, each type of business gained competition. When competition began, focus, or the Wow factor, was born. The main component of the Wow factor is the ability to sell what the business carries-whether the product is cheap, expensive, customized, easily obtainable, etc. The more merchants that opened up in one's city, the smaller “piece of the market” that became available.
The Problem
Two main problems exist in most companies that use inventory buyers; the salespeople do not have direct contact with buyers to inform them what is selling well and what is slow, and buyers do not always hear about new items that would make good trial products to sell.
Also, depending on the emotional makeup of staff, some employees are very comfortable
making sales presentations [“Is there anything else you need today” is not considered
a sales presentation or part of a presentation] and others abhor the process. When a person
becomes very comfortable and successful, sales and profits rise dramatically within a company.
Companies across America, depending on the firm's objectives, hire sales people to stay in the “field” and meet both end users and /or industrial buyers who add the sales person's product to their own-thus, becoming “parts” salespeople. And there are firms who only sell to governments including the US military, using RFP's [Request for Proposals.]
In the field, the company has usually chosen to pay [remunerate] the field sales person with commission only, salary only or a combination of the two.
Also, there are two basic types of sales people; the hard seller who sells what he has and is not concerned about solving the clients needs [the type of sales person who gives all others a bad name] and those who satisfy the clients needs. Your paper author has been both and would never ever again return to being a hard seller. [Your author also held a school test record; ranking #1 in college students who were also salespeople, 1975.]
Significance of the Problem
Merchants have challenging concerns regarding selling: if inventory is not sold, the bills are not paid. Simple! Also, inventory [or services] must be sold at a predetermined price that will cover the expenses of the firm, the cost of the product and provide a profit sufficient to allow a draw-the money the merchant needs to pay home expenses [also known as take home pay].
Since companies often have no trained sales people or no “sales people” at all, those firms are limited to what their pricing can do to motivate people to buy.
Entire chains [a company that has many sites or “outlets”] have gone bankrupt because the firm has chosen price over quality and thus, does not employ salespeople as the term “sales” infers. A sales person is a highly skilled person who understands the difference between simply procuring an item from a shelf or warehouse and handing it to the customer who takes it to the cashier and helping a client make a wise purchasing decision.
A top qualified sales person never pushes a person to buy but instead, help a client decide which goods are best for the customer's stated reasons. For these reasons, a sales clerk in a discount store will rarely see a paycheck for more than $25,000 a year while a top qualified sales person in the filed can take home over $125,000.
Methodology
The author, a business consultant and college business teacher, has done primary research, and reviewed secondary literature regarding small business inventory control and compared sales methods used by start up entrepreneurs and compared them to successful companies and failed firms who did not use these methods.
Solutions
Dozens of market research firms nationwide have been hired by the “Fortune 500" [the top
companies in the US regarding their annual sales] to determine the satisfaction level
of customers. Unfortunately, over 75 percept of customers [of both retail and resale goods]
were unhappy with the attitudes, knowledge and overall quality of the sales people, aka,
clerks who have helped them in their purchase. This paper's author agrees with those
numbers and easily understand why the satisfaction level is so low. It is a number of things
but easily starts off with attitudes from the CEO and VP, down to the entry level employees.
When net profit is the sole or main objective VOICED by the managers of a company, the entire company MUST suffer. Here is why: while in the board rooms, it is essential for the “hierarchy” to know both the “nut to crack [the sales point at which net profit is reached] and the point at which dividends are begun, these cannot be fixated in the staff at the same level of focus as is CUSTOMER SERVICE. Unfortunately, the boards and highest level officers ARE myopic and forget why this is.
