Fine in the past

Are you hindered by once-effective sales policies?

f cell tr FIP: Fine in the Past. It Irefers to all the sales and marketing efforts, ideas, policies, principles, techniques and strategies that worked well in the past, but are no longer effective. The past is everything that's pre-2010.

I still recall a poignant moment with an attendee at one of my seminars. During the break he came up to me and said this: "I've been in business for l7 years. And we've done well. But now, it seems like everything is changing, and I don't know what to do."

He went on to explain that he had built his formerly thriving tool-anddie business on certain core princi- ples: quality workmanship, competitive prices, and good service. Those principles, adhered to with discipline and conviction, had brought him word-of-mouth business consistently over the years. But they were no longer working, and his business was floundering. The pain and confusion were written all over his face as he contemplated the prospect of seeing his business wither away.

Those principles are some of the most common examples of FIPbusiness principles and policies that were sufficient on which to build a business, but today are not. At one time, you could distinguish your business from others on the basis of these and other FIP principles. Now, however, the bar has risen. Because there is so much churn in our marketplace and the competition is so fierce, the kinds of service and quality that were sufficient to distinguish yourself from your competition are no longer sufficient. Customers expect outstanding levels of service and quality from every supplier. What was sufficient a few years ago is still necessary today, but no longer sufficient.

That reliance on quality service and word-of-mouth marketing is an FIP principle. When viewed from the perspective of effective sales and marketing approaches, these principles are passive. They rely on your customers coming to you, recognizing the superiority of your product or service, and then talking about you to others. Your job is to create an attractive operation that will pull customers to you and then keep them coming back.

When everyone else operated in similar fashion, that was FIP. But when more and more competitors appear and they make the same claims as you do. your reliance on passive marketing methods relegates you to second choice.

I've seen literally hundreds of businesses of all sizes that never reached their potential because of an inability to do sales well. They were perfectly capable of rendering outstanding service at competitive prices but struggled to survive. These FIP principles were so deeply ingrained in their mindsets that they never learned to do sales as well as they could, and their businesses never reached the level of prosperity and success that they could have reached. The economic landscape is littered with the remains of businesses who were excellent in providing their product or service, but mediocre in selling it.

Here are some other FIP practices. See if they apply to you:

FIP * 1: Creating sales by hiring several salespeople, giving them some basic training, and then charging them with "Go forth and sell a lot." Sales territories were geographically based, and each salesperson was a clone of the other. Accountability was a nasty word that no one repeated.

Alas, this FIP practice is a prescription for inefficient sales practices. The better approach is a variety of sales methodologies, based on the potential and dynamics of the customer.

FIP * Z: Sales management by pay plan.

In other words, pay them straight commission and everything will take care of itself.

There was a generation for whom this worked. Unfortunately, today's work force is rarely motivated by just money.

FIP # 3: Reliance on "on-the-job" training.

Everyone can learn how to be an effective salesperson. Just put them out there in a sales territory, and sooner or later they will figure out how to do the job well.

When the job of the salesperson was simpler, and the customer less sophisticated, this was okay. Today, of course, it positions your sales force as the less educated, less competent one in the market.

FIP # 4: Hiring by "feel."

When it comes time to hire a new salesperson, find someone who has some experience in the industry and about whom you "feel" good.

This is a prescription for a group of clones who please the boss, but are rarely what the job demands. There are far more sophisticated and effective hiring criteria and practices than this one.

The list of FIP practices can go on for quite a while. These are the most common. If they apply to you, it is time to rethink your position and move your sales and marketing efforts into the 21st Century.

- Mr. Kahle is a sales consultant, trainer and author. Reach him at (616) 45 1-9377 or via www.davekahle .com.

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Gapital Expands in Spokane

Capital Lumber has expanded its distribution center in Spokane Valley, Wa.

The expansion doubled warehouse space to 20,000 sq. ft., allowing for the addition of new specialty product lines such as plywood, #2 green Douglas fir timbers, and additional pine patterns and board.

Fremont Hardware Store Adding Lumberyard & More

Dale Hardware, Fremont, Ca., is using $8 million from a federal stimulus tax-exempt bond program to more than double the size of its operation to nearly 100,000 sq. ft., while adding two garden centers, offices, retail space, and a 22,000-sq. ft., enclosed, drive-thru lumberyard.

The store remains open during the renovation, which is expected to be completed by second quarter 2O12.

Piedmont Owners Vindicated

Nearly a year after fire consumed Piedmont Lumber, Walnut Creek, Ca., fire investigators have formally ruled out arson-but the specific source of ignition and cause remain unknown.

Investisator Vic Massenkoff said that an examination of the site and a review of the company's business and financial behavior yielded no evidence of criminal activity. The massive fire caused $6 million in damage, just seven months after an arsonist torched a storage shed at the company's location in Pittsburg, Ca.

"This gives us some peace," said Rob Myer, son of Piedmont owner William Myer Jr. and grandson of the company's founder. "From the outside looking in, I see how it looked suspicious. It was a sensational story with a business in financial trouble and a mysterious fire."

Looking ahead, the Myers have been busy with a new company in Pacheco, Ca., scheduled to launch March I l. Staffed by former Piedmont employees, it specializes in architectural millwork. Myer said, "We feel like a phoenix rising from the ashes."

Midway Sawmill Sale Closes

Boundary Sawmill has completed its acquisition of the former Pope & Talbot sawmill at Midway, B.C.

The deal includes purchase of the plant from Fox Lumber Sales, Hamilton, Mt.; payment of local back taxes, and a provision for Vaagen

Fibre Canada-a division of Vaagen Brothers Lumber, Colville, Wa.-to lease and run the mill for 10 years, with an option to renew (see Feb., page 40).

The facility has been idle for three years.

Clay Building Material Producer Goes Retail

CompoClay, manufacturer of ecofriendly construction materials and garden products, has opened retail showrooms in Los Angeles, Alameda, and San Francisco, Ca.

Although they look like stone lanterns, porcelain planters, wooden fireplace mantels, and metal paneling, all products are made from a patented mixture of natural minerals- sand and sea salt.

Siding Maker Adds Brands

Georgia Gulf, Atlanta, Ga., has acquired Exterior Portfolio, Columbus, Oh., from Crane for $12 million, combining it with its Royal Building Products division.

Exterior Portfolio's brands include CraneBoard, Portsmouth Shake, Solid CoRe Siding, and Architectural Essentials.