Developing Winning Sales Strategies

For printing managers, increasing sales has never been more important, the task never more challenging. Brutal price competition plagues nearly every market segment, other media forms continue to siphon off print volumes, and poor corporate earnings have resulted in miniscule print budgets.

If the situation sounds bleak, that's because it is.

"The industry is in a severe sales slump; in fact, printing companies' number-one concern is generating revenue," reports Andrew D. Paparozzi, vice president and chief economist of the National Association for Printing Leadership, Paramus, N.J. For all of 2002, he forecasts that printing sales will fall 1.9%, on top of a drop last year of 3.9%.

"There simply isn't enough work to go around. The companies that will succeed in this environment are those that can differentiate themselves and rise above commodity-level selling," Paparozzi says. "Right now, prices are dropping dramatically and price cutting is widespread as a result of industry overcapacity."

Survival, he adds, requires printing executives to develop new sales strategies that make the downturn in the economy a competitor's problem–-which is easier said than done.

"Most sales reps can't explain to a prospect why it's in their best interest to give them an appointment, because most printers have not defined why a firm would want to do business with them. In a nutshell, printers have failed to differentiate themselves from competitors," observes Sid Chadwick, president of Chadwick Consulting, Lewisville, N.C.

Chadwick, a business development consultant as well as a sales team educator and trainer for the graphic arts industry, believes that a core strategy for managers is to train and support the sales staff in the art of marketing because sales and marketing are inextricably linked.

"Only one sales rep in a hundred knows how to research target customers and prospects," he explains. "Buyers simply don't have time to listen to a sales rep who doesn't understand their business, and they certainly don't have time to train anyone."

In his view, most printers have failed to give customers any reasons to build long-term relationships. Printing companies need to constantly gather information about customer business conditions, then use that information to create value, says Chadwick.

"Business development is a lower life form in most graphic arts firms, whereas it should be priority number-one. It is more important than production and finance, as it drives your revenue stream," Chadwick contends.

The key to winning sales numbers is, in a word, prospecting, advises Peter Ebner, principal of Peter Ebner Seminars, a graphic arts sales training firm based in Ontario. Ebner says that most printing managers base their company's sales success on existing customers, when they should focus on expanding their client base.

Says Ebner, "Many printing companies have one, two, maybe three accounts that make up 80% of their business. If any of the accounts cut back on their spending, those companies are in big trouble. To protect themselves, companies need to focus on prospecting. To me, the biggest sales problem in the industry is lack of prospecting."

For 90% of those printers that actively prospect, he adds, recessions and other factors that can cause a business slump will have no effect.

To support his point, Ebner recalls the last recession that gripped the printing industry: "We had many shops closing down, more equipment for sale than could be used, and severe price erosion. Still, there were printers doing a booming business because they were expanding their client base. Companies that rest on their existing accounts suffer hard and instantly when business conditions deteriorate."

Ebner proposes use of a prospecting strategy called "magic 25". He says sales representatives should be required either to make 25 phone calls a day or obtain two new appointments a day until they reach quota. He says this practice has been proven to lead to 100 new customers per year.

He explains, "For every 25 phone calls, 10 will reach the buyer, two of whom will agree to an appointment. Of those 10 appointments per week, two will award a job. Two new jobs per week means a hundred new customers for the year–-and this requires no particular selling skill, just persistence and discipline."

The more experienced sales people, he says, should be able to get two appointments a day without having to make 25 calls.

Ebner says that this formula, which is based on his many years of selling experience in the printing industry, rarely fails. However, a major roadblock for companies undertaking this strategy is the long-held practice of evaluating sales staff solely on making their quota. Ebner's method requires management to measure the daily activity of sales staff.

"Most managers are afraid to manage sales people because they don't have a clear picture of what it takes to be successful," says the sales expert. "A successful salesperson is involved in daily activities that lead to success, and there's only one activity that leads to success in sales–-and that is prospecting."

Another method that printers use to boost sales is to expand their service offering, since offering more can increase the sales volume generated per client.

Ron Seavy is managing partner of The Open Approach, Westmont, Ill., a consulting firm founded by Seavy, a former sales vice president for printing giant Wallace, and two other Wallace executives. Says Seavy, "The average spend on print by a company is 1% of net revenue. However, companies spend twice that much on services that surround print, like design, distribution, digital asset management, and fulfillment. By offering more services, a company can increase its share of sales from a customer."

He says offering more services has gotten a lot easier (how printers can expand their offerings will be explored in more detail in the October issue of GAM).

Also, says Seavy, "Managers in corporations tell us they are concerned about the viability of printers they do business with because so many of them are in trouble. They are looking to partner long term, and are concerned that the printers they partner with have the capabilities and resources to continue offering them the latest in technology."

Seavy concludes, "Customers want a printing vendor that will help them manage the relationship with their client. So if a client makes shoes, then they want their printer to come up with the best and most economical way to market shoes. This means understanding the secondary customer's business."