Trend: Cross-Selling

By Jeffrey Rothfeder  |  Posted 07-01-2003 Print Email
Selling more products and services to your current customers seems a sure way to increase profits—but the results have been mixed. Are we getting better at it?

Allied Office Products Inc. doesn't have the luxury of waiting for revenue to walk into its store. The $300 million Clifton, N.J.-based seller of office supplies and services to small businesses throughout the Northeast has a team of more than 200 salespeople—feet on the street, as they're called by company executives—who work door-to-door and phone call by phone call to line up new customers and squeeze additional orders from existing ones.

"We're a head-count business: I know that if you have a 60-person office, you should buy $300 worth of basic office supplies—paper, pens, staples—from us with each order," says Mike Palmer, Allied's CoO. "But if that's all we get, we stagnate. For us to grow, we have to convince the customer, who already likes our products and service, to buy more than just basic supplies; we have to increase the order by 10, 20 or 30 times."

That job is given to Allied's "specialists": salespeople who are trained to push the company's less traditional, higher-margin lines such as coffee and refreshments, printing and forms management, and office furniture. Specialists split the commission with their local account executives, who in the past were responsible for alerting

specialists to customers they should contact. With that approach, however, a lot of opportunities slipped through the cracks—often because the specialists were never told about them. Some account execs were wary of other Allied sales staff coming into their territories, even if it meant the possibility of additional income, while others simply forgot to pass along the leads.

So last year, Palmer installed a new sales-force system that automatically does what many account executives didn't do: It generates ranked lists of customers based on order size, type of business, items purchased and other categories. As these leads are received, specialists are required to follow up and enter into the system the results of their contact with the customer—everything from "no interest," to "left a message," to "set up an appointment," to "signed up an additional $12,000 order for printing services." These outcomes are then collected in reports that provide Allied management with a day-by-day analysis of sales efforts, viewed through any number of variables—revenue by specialist, size of customer orders, and length of time a lead remains opened, for instance.

"The system has energized our sales force," says Palmer. "It relieves the account executive of having to reach out to the specialist, while vastly increasing our company-wide knowledge of sales opportunities and improving our ability to send the sales specialist in after them. It's made a big difference in our performance."



 

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