#Customers#Potential

We have defined that a sales engineer can and should be able to attend about 100 customers (ratio valid for the industry market).

How to choose the hundred customers? We will do it based on purchasing potential defined as the total value of purchases that the customer makes with the same, similar or substitute products as we can offer.

It is fundamental to include similar products and especially substitutes because ultimately these are the ones which can represent a real threat to our sales. It is difficult and it is not recommended (because it is not profitable) to want to know the 100 % potential of a customer. It is not cost effective because it forces often to spend too much time in the analysis, time not available by sales engineers. In the industrial sector that I know much better, to know between 85% / 95% of the potential is more than acceptable.

It also depends very much on the range of products we have in our portfolio. It is not the same to find out the potential of a customer when we sell two products or when we sell a hundred.

Knowing purchasing potential is one of the main tasks of a sales engineer. The purchasing potential is established in several ways:

1.) Asking the client directly

2.) Comparing with clients who perform the same activity

3.) Knowing in-depth the application of our products

I have met many times with sales engineers struggling to ask customers about the potential purchase. If the customer's relationship is well established and we put the appropriate questions it should not be a problem. It often happens that our contact person is not valid to answer our questions on this issue. In any case sales engineer must have as one of its priorities to get the potential of the customers.

Only in this way we can calculate the potential of the assigned area and establish an appropriate business strategy.

We already know the potential of selected clients and also we know it by product line or individual products according to the detail that we want to get. I recommend a review of previous publications to avoid falling into unnecessary detail!

It is time to classify customers and we will do so based on the Potential / Sales ratio:

We define the following categories of potential assuming we give a scale of zero to one hundred (0-100 with 100 being the maximum potential clients analyzed):

Key Class         (100+)

Middle Class    (50-100

Basic Class      (20-50)

1.) Regular Customers. Those in which the turnover exceeds 60% of the potential established. Applicable to Key Class and Middle Class.

2.) Growth Customers. Those in which the turnover does not exceed 20% of the potential established. Applicable to Key Class and Middle Class

3.) Basic Customers. Those in which the potential is in the Basic Class (20-50)

4.) Call Centre Customer. Those whose potential is in (5-20) Active and those whose potential is in (1-5) Passive 

  

5.) New Customers. Those which we have the target to start working with them.

With all this we will complete a working matrix to be discussed conveniently in our next publication. We also deal with how to fit the distribution and how to treat engineering companies or specifiers. We are in the line of establishing a selling machine with our sales organization!