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Thursday, 7 January 2016
a Kenyan SME turned around its Stagnated Sales by engaging an external
Our client had been in business of
supply of office equipment and furniture for eight years by the time we first
interacted. The owner of the business met with my wife in a church service and
on learning what I do she asked that I call her to set up an appointment. On
the following Monday afternoon we met.
The business ran a showroom near a
major shopping mall in Nairobi. The showroom displayed most of the products the
business dealt. A few walk customers bought also bought directly from the
The bulk of the firm’s sales was generated
by the owner and sales people who went out to pitch the firm’s products and
response to tender invitations that were advertised in the newspapers.
The firm’s clientele was
predominantly public sector institutions and international NGOs.
Once we (Growth Partners
Consultants) got in we immersed ourselves in the businesses accounting data, we
spoke to employees and the owner.
We asked a lot of questions and
listened hard. We picked out trends and followed problems beyond the obvious
symptoms to root causes of the problems.
From this exercise we identified
these four problems to be the most pressing at that point and once addressed
the firm will be in a better place to address others.
Overreliance on the owner to generate
The owner was
previously employed in a similar business before she left to set up her own
firm. She relied mainly on the experience and contacts she had made in the last
to generate Kshs 58 Million of the Kshs 70million that the business did in the
previous year. By the time we met the proportion was far much higher.
Stagnated Sales Growth
The firm’s sales
had stagnated at Kshs 70million for the last 3 years and the current year did
not seem like it would change positively due to post election violence that had
hit the country in the year. However hard the owner and employees worked they
ended up on the same ceiling.
Sales Hires who didn’t Stick
struggled to hire right sales people who had the personality, skills and
motivation to hack selling to government and other organizations. Whenever they
got someone who looked like a good match, the person left within a few months
out of frustration or availability of greener pastures elsewhere.
Sales Team that did not Hit Targets
Those who stayed
took years to start generating sales and none of the existing 4 sales people
had done more than 50% of their sales targets since employment.
As a result of
these sales challenges the firm was experiencing major cash flow problems. It
was unable to service many customer orders. Customers were furious and rarely
did they buy again from the firm after the first bad experience.
The firm had never
engaged any consultant before but at that point they were open to any help that
came their way especially if it was within their means to pay for it.
Solving the problem
After initial analysis of the
situation and presentation of the business’s problem in a way that made
financial sense to the firm they engaged our services for one year. Our mandate
was to help them turn around the sales situation.
It appeared like a daunting task
but we were willing to dare and the client had confidence that we could do it
especially after we gave measurable outcomes from the consultancy engagement.
Milestones were agreed upon and captured in the contract. We were willing to be
held accountable for the outcomes.
10% Sales Growth in the year;
team generate 80% of sales and the owner and showroom the rest;
sales people producing as much as the owner;
the sales people achieve at least 70% of their monthly sales targets.
With this confidence we picked out
the areas where we could achieve the rapid results. From our analysis we understood
that the firm was sending out quotations amounting to Kshs 0.5 Billion a year.
The conversion rate was less than 3%. Taking this closing rate to 20% was easy.
This information lay in the organization and no one had a clue it existed. From
this data lay an easy route to great success.
We put in a programme and within 3
months we had the closing rate upto 15%. The top performer had a closing rate
In the time 2 of the longtime sales
people left abruptly as they could no longer hide when number focused tracking
was in place. They used to run their side businesses while still in employment
since they were the most trusted employees and also prided themselves as top
We helped the firm hire three new
sales people. Previously, the firm hired from within its industry. These new people
were from outside the industry. The owner was not convinced this was right
decision but, with some persuasion she reluctantly allowed it. One of the
candidates was a fresh diploma graduate while the other two were from retail
banking sales. They adapted easily into the results oriented culture we were
As part of the recruitment we put
in place a sales programme on board that would help new sales people start
producing within the shortest time possible and achieve Kshs 1 Million monthly
sales within 6 months. The industry average of a great new sales person
achieving this production was then 24months.
We devised a manual system to
record and tract every person’s daily activity. All potential prospects were
captured and every quotation was tracked to conclusion. Every month every sales
person had a performance evaluation-cum- coaching session with a sales
Initially the employees were scared
of the moments but one year after we stopped this programme the sales people
demanded for its re-introduction. They attributed this performance management programme
to their great improvement.
After one year of engagement the
client had experienced the following results:
The firm’s annual
sales grew from Kshs 70 Million to Kshs 98Million. This was 40% growth compared
to the 10% we had targeted.
Productive Sales Force
Of the Ksh98
Million turnover the owner was responsible for only Kshs 29Million which was
about 30% of the total revenues. The sales force was generating over 70% of the
The sales force
had grown to 7 sales people with 5 of them having joined during our
engagement.Of the 2 who were there
their sales had grown by over 300%. The new ones had achieved a combined
performance of 70% of their consolidated target.
Enduring Sales Structure
There were clear
sales management structures upon which to build future success for the business.
involvement with the client remains, we are called upon to assist in specific
areas such as strategy development, selection, management coaching and training
since the building blocks for a sales success we put in place years ago are in
The business is no longer reliant
on the owner to generate and grow its revenues, it has sales people who have
been performing at high levels over the last four years and new hires start
producing within the shortest time.