|Case Study: Changing Sales Systems to Meet Changing Marketplace Conditions|
To address the growing concerns of its membership with regard to effectively managing deductions, the National Confectioner’s Association (NCA) retained Dechert-Hampe & Co. (DHC) to research and analyze the issue within the industry, make recommendations, and assist the Association in implementing a program to assist its members.
The company wanted to remove the brokers/agents from their position between the manufacturer and the customers because they desired a more direct relationship and because they thought they could do a better job managing the business directly than the brokers/agents. The major (and very large) concern was, “Will the trade take punitive action if the brokers/agents are removed from the business?”
There were two major challenges:
DHC assisted the company in conducting a thorough analysis of the likely reaction of key customers to the planned change in marketplace representation. The analysis also included a review of the potential/likely responses of the major broker to the termination of their role as sales representative for the company. The analysis concluded that most customers would consider the change to be “no big deal” since many were not particularly enamored of the broker’s performance in the first place. This also confirmed the company’s belief that they could do a better job themselves than the broker was doing on their behalf. The worst case scenario was that some customers, while expressing some loyalty to the broker, would still give the company a chance to “prove itself” in the new arrangement.
Once the decision to proceed was made, DHC assisted the company in developing an implementation plan to execute the change. The plan covered such things as procedures for notifying the brokers and notifying the customers. Also, DHC did the analysis that resulted in the sales coverage plan for the new direct sales organization that the company would field. Finally, the plan covered the steps needed (training, customer information acquisition, first-call priorities, etc.) to actually make the switch operational.