Industry Panel on Cultivating Business - Jan 2010
Increasingly, contract dealers are creating a business development position to help their firms cultivate relationships for opportunities down the road. Though a few firms have been taking this approach for a number of years, others are increasingly adopting this long-term strategy.
The position differs from a traditional sales role in that business development specialists are not necessarily closing deals and they often hand off to the sales force when it’s time to close the deal. It’s not uncommon for the development specialists to be hired out of the design community, which is generally the target audience.
Floor Focus tracked down four business development specialists from four different Starnet affiliated contract dealers to ask them about the strategies and goals of the position. We spoke with: Kathi Kennedy from Howard’s Rug Company; Sharon Curtis from Vector Concepts; Gayle Seker from CB Flooring; and Sheri Gorman from RD Weis.
Q: What motivated your company to create this position?
Kennedy: Rob Hailey, the owner of Howard’s Rug Company, felt that there was a real opportunity to secure business by being proactive in the specification process. In the same way that a manufacturer’s rep calls on A&D and end-users, he felt that it was important to establish communication early on in the planning process.
Seker: We felt that we were viewed as a bid house and really wanted to adjust our focus to become more of a flooring advisor and get involved prior to the bid process.
We noticed that the majority of our work was from our current clients and we were interested in extending the life of a job. We needed to visit the end users directly after the general contractor’s job was complete. We felt that we were walking away from future business after the last piece of material was installed.
Lastly, with the economy, we knew that we needed to differentiate ourselves in the market and needed to develop new business.
Gorman: RD Weis created this position to further grow the RD Weis brand as well as to reach out to new market segments. My primary focus is working with A&D firms. We felt that by penetrating the A&D market and positioning our company as “flooring solutions” we could grow our business.
Q: How long have you been doing it?
Kennedy: I have been involved in business development and product selection at Howard’s Rug Company for ten years. Before that, I had my own company called Details Details. I was an independent representative for several furniture and lighting companies.
Seker: I have been in sales for over 20 years and have spent the last six years with a title of Business Development. From a company standpoint, the new position started officially in August 2009.
Gorman: I have been with RD Weis for three years. I have been working in the industry for 18 years, three years in the carpet field.
Q: How does this position differ from a typical sales position?
Kennedy: I tell people “I only work with happy people,” which is to say I am at the front end of projects where people are excited about their selections and are interested in the process. I spend a lot of time following up on leads, particularly with A&D companies. I am involved in the planning process of the projects, such as product research, specification, preliminary budgeting, LEED research and data gathering, and I help with custom products and design. I take projects up to the point of bidding and sales.
Curtis: This position is more about marketing and public relations. Success is ambiguous in relationship to time and dollars spent compared to the bottom line and profitability.
Seker: My job is to bring the business in the door. But I’m no longer considered the shark going in for the kill. Now I’m just a really good marriage counselor. I’m building relationships based on trust away from the bidding content. My position becomes non-threatening to a general contractor because I’m not the one directly asking for the sale. I eventually become the negotiator between the GC and our company/sales rep. General contractors are more amenable to opening up around their true needs and wants if you remove the sales aspect and build a relationship outside of a contract.
Gorman: By working with designers, we can get involved in the flooring selections from the beginning of the project. This also allows us to position other flooring services we offer as well, such as maintenance. I tend to be the one who makes the initial contact, gets the information on the project, and then hands it off for a salesperson to manage.
Q: With whom do you spend most of your time building relationships?
Kennedy: By far most of my time is spent with architects and interior designers. I spend time with them both professionally and socially. I am a strong believer in relationship selling. If a client likes you and trusts you, they will want to do business with you.
Seker: Decision makers, end users, manufacturer reps and industry related associations, along with social/networking committees. Also current clients—it’s a great opportunity to get feedback and ask for referrals—and jobsite foremen and superintendents. Keeping them up to date, entertained and happy keeps me in the loop of up and coming projects. It also allows for an open line of communication and eliminates jobsite explosions when they feel you are someone they can contact should a problem arise.
Gorman: Most of the time I spend is within the architecture and design community. I network with end-users, real estate brokers and facility managers at corporate businesses as well as hospitals. The manufacturers’ representatives are also important people to have relationships with.
Q: Who else do you call on?
Kennedy: I also call on end-users and occasionally general contractors. I am often referred to an end-user through a general contractor or a previous client to help with product selection. I offer the same services that I provide my A&D clients.
Curtis: I spend time being active in IIDA and USGBC on committees and attending meetings.
Seker: Facility managers as well as old clients that we haven’t done business with in a while, uncovering why we don’t do business with them anymore. Also clients that we have completed installations for to conduct a client survey assessment. Also large corporate accounts in our local area, as well as community service groups, looking for ways to be included, either by volunteering, donating or personal awareness.
Gorman: The majority of my time is spent educating designers on products and services that we offer. I also call on facility managers and in-house designers for companies.
Q: How are you incentivized to be most effective?
Kennedy: I believe that in order to be successful there cannot be a limit on how much income a person can make. If a person works hard to be successful, they should be compensated. My income is figured on a base salary plus commission.
Curtis: A percentage of project dollars based on profitability of the project.
Seker: Base plus bonus, based on overall company performance. There’s also a new account bonus.
Q: Does this position give your company an advantage when a project goes to bid? Explain how.
Kennedy: The key is to have early involvement in that project. Being involved with the design community allows you access to information about projects that you wouldn’t ordinarily find through normal lead sources such as Dodge reports or general contractor listings. The information you gain in the early stages helps to direct your strategy when the project bids.
Curtis: When I spend time on a project working with the design team in selecting products and discovering who the GC bidders will be, I have a definite advantage. I am specifying products that I know are appropriate for the project, which saves time and money. I know all the changes that occurred during the design phase; I know about addendums that will affect the bid. Also, the effort expended on the projects we lose always gives us another opportunity to be asked to participate again.
Seker: Absolutely. The position really should be Director of Relationships. Getting to know your customers on a more personal level helps better uncover what their true needs and wants are. When you can get to know someone outside of work, you are better able to understand what motivates them. It’s building strategic partnerships that last past the installation.
I’m not viewed as just another sales flooring contractor, I’m a great resource for them personally. People don’t just ask me about flooring. Yes, I know all the important flooring manufacturers and I can get almost any material that can be nailed, laid or glued to a floor, but I also know everyone else. I’m not just developing our business, I’m developing theirs, which is the advantage for both of us.
Gorman: When a project goes out to bid, we have an obvious advantage with the manufacturer since it was our initial introduction that brought the manufacturer to the project. It opens the door for our maintenance services as well.
Q: How much time do you spend away from the office?
Kennedy: I try to be out of the office calling on customers three to four hours a day. I think I am much more effective when I can meet directly as opposed to over the phone. Sometime, however, it’s not an effective use of my time.
Curtis: On an annual basis, 75%.
Seker: Not as much time as I’d like, but this is still in the infancy stage and we are still in the process of fine-tuning our new approach in this market.
It takes time to get in with the right networking groups, associations and end users, not to mention the decision makers. There is also a fair amount of research, new client tracking, and marketing that is constantly being updated and developed as trends and general contractors change within the industry.
Gorman: Fifty percent of my time is spent in the field, as well as at networking events in the evening.
Q: Please explain a typical workday.
Kennedy: There isn’t a typical work day and there’s never a dull moment. I usually have at least two or three sales calls and meetings planned each day. I often spend a couple of hours in the showroom either working with customers or selecting products to be presented at meetings. I work closely with manufacturer reps and meet with several during a typical day. I host training seminars for A&D and facility managers with our manufacturer partners. I also attend industry meetings such as IIDA and volunteer time for their activities. There are also after-work social events with my customers.
Curtis: With the Blackberry technology for live email, it’s almost unnecessary to be in the office. In the morning I follow up with samples, tomorrow’s lunch date/CEU presentation, meetings with clients at the showroom, and meetings with manufacturer reps to see new products. I also do planning, including scheduling CEU presentations, preparing documents for CEU and other activities.
I’ll often have lunch with a client, a rep, or a working lunch at the showroom with a client. In the afternoon, I’ll drop by to see interiors staff in small firms to discuss new products, the last project, a new project, or just to thank them.
Beginning this month, I will support our out of town sales staff with CEU luncheons and/or IIDA evening CEU presentations.
Seker: There might be a local breakfast networking group. I review and research new leads; update sales leads through an online calendaring system for distribution, and monitor and track sales rep volume and progress. I also generate new sales leads through phone or email contacts from social networking. I might have several customer service phone calls that require some type of action.
There might also be lunch with a client or a new prospect. I work to develop new tools for the sales team to improve company efficiency and presentation. I’ll also research competitor information, develop our own marketing or search for the next networking event; meet with vendors/manufacturer reps, assist the sales team, and research projects.
Late evening is computer time, updating my contact database or looking for new ideas. Sometimes I’m out late at a networking event.
Gorman: My day begins by checking my Blackberry, catching up on emails and phone calls. I might meet with a manufacturer’s rep to see new products. I will meet with several designers showing new products. I average one CEU presentation a week.
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