The Secrets of Sales Success in the Current Freight Environment
As reported in previous blogs, my consulting work provides me with an opportunity to meet senior sales and management personnel from transportation organizations across North America on an ongoing basis. I also have an opportunity to observe how shippers respond to the sales efforts of these individuals. There is no doubt that these are unique times in our industry. It is very challenging trying to sell freight services in the current weak economy. While a considerable amount of capacity has exited the industry, there is still plenty of capacity out there. This creates a difficult situation for freight sales personnel as there are too many trucks and too many sales people chasing too little freight.
Based on my observations over the past several years, there are a number of traits that you can identify among the sales executives that are achieving success in these troubled times. Here is my list of attributes:
1. Clarity of focus
Successful sales personnel know what their companies do best and where they can be most competitive. They know how to communicate their companies’ unique value proposition in a way that is compelling and credible. They know where they have a chance to win based on service and price.
There is a lot of desperation in the market. With business soft, it is easy to slip into the trap of chasing just about any freight that moves. The successful sales people know when to say “no’”. They know how far they can go and when it is time to walk away from certain freight. By saying “no”, they send a message to the shipper that they work for a financially responsible company that is likely to whether the storm. In many cases, the “no” makes a positive statement about the sales person and the company.
At other times it is important to say “yes”, even if the business does not pay well. By doing so, you maintain an important piece of back haul freight and buy some time to migrate your head haul freight rates to a level where your round trip, triangle or rectangle is compensatory. This pricing discipline is lacking in some companies today.
Successful sales executives sell their companies’ services with a passion. They have a deep belief in the service performance of their operation and they are able to communicate this message with conviction. This creates confidence in the sales person and in the company.
4. Closing skills
It is amazing how many polished, articulate sales personnel cannot close. They are very knowledgeable and well dressed. They can talk about all of the things their company is doing to improve service but they don’t know how to ask the key questions, “what do I have to do to secure your business and can I have your business.” This explains in part why there is so much turnover among sales personnel in the transportation industry.
These reps know everyone in the business, they interview well and they present themselves well. But they don’t get any freight. Over time their companies get wise to their lack of performance and they are asked to move on down the road. Since freight companies are always on the hunt for good sales people, these poor closers stay two or three years at a firm until the management at that company realizes that they made a bad hiring decision. The good closer knows how to ask the magical questions that generate business.
5. Rate negotiation skills
In the current freight environment, your senior sales personnel have to be empowered to negotiate rates. It is absolutely deadly to go in on a sales call in this environment and say, “I will speak with my Pricing Manager and get back to you in a couple of days”. Corporate Traffic Managers are busy people wearing multiple hats, managing multiple modes of transport and often managing other related functions. In such a highly competitive market, the successful sales executive has to know the bottom line rate per mile or discount level that he can go to and has to be able to cut a deal on the spot. Sales personnel who are empowered to negotiate rates and are skilful in this area have a much higher likelihood of success.
6. Work for a Quality Service Company
Smart shippers do their homework. They know their carriers and they know which ones perform or don’t perform. Working for a poor service carrier can be career threatening. Many of the shippers I work with are very focused on price but they will not award business to a carrier that will damage their company’s image in the market. If your company does not have a commitment to service, you are probably better off seeking a carrier that has this commitment. As a freight sales person, you may end up being the “fall guy” for the weaknesses of your company.
7. Work for a Financially Stable Company
The same issue pertains to the financial stability of your company. I see bids where a carrier will “submarine” the rates of their competitors. However, if this carrier is reputed to be in financial jeopardy, smart shippers will find other options. They will find a financially stable company that will meet or beat the low rates.
The shipper may or may not feel comfortable discussing this issue with their financially troubled carrier. Nevertheless, it you are losing out on opportunities to increase your sales revenue because the “word on the street” is that your company is struggling financially, you may wish to look for other employment rather than wait for the “ship to go down” or wait for you to go down due to the poor reputation of your company.
Successful sales people know how to size up the competitive dynamic at play. They find out where their prospect or customer needs help. They come prepared to do something better than their competitors, to get their “foot in the door” so they can establish themselves. By taking on a piece of business for the shipper that is problematic or where there is limited capacity at the designated price point, they create a foothold upon which they can build their business. Moreover, when they meet with the shipper and the “moment of truth” presents itself, they have a solution and pricing in place. They are ready to close on the spot.
Successful freight sales personnel are able to make adjustments. They are able to bridge the gap that may exist between the shippers’ requirements and the carrier’s capabilities. They are able to find a middle ground and sell it to their own management and their customers.
While the expression “thinking out of the box” has become a widely used cliché, it is critical in these tough times to be fast on your feet. Shippers are seeking cost reductions; they are looking for ways to grow their markets, whether this means domestic or international shipping. As one door closes, another door may open. Success goes to those sales personnel who are able to go where their customers wish to go, or even better, are able to take their customers to places that had not figured out how to get to.