Below is an interesting report on the above topic for pest control entrepreneurs in Malaysia to learn and adapt:
Our consulting firms, Sales Effectiveness and Coleman Services, recently conducted a Commercial Pest Control study to determine what pest management industry sales leaders are doing to accelerate growth in their commercial accounts, and to provide insight on methods sales leaders can apply to build their businesses. The feedback has been positive and we believe PMPs will gain value from its message. We approached and ultimately interviewed 16 companies from PCT’s Top 100 who were willing to share their insights and approaches with us.
All participating companies had a presence in the commercial segment. The average company in our survey generates about 70 percent of its business from residential sales, with 30 percent coming from commercial segments. For some, commercial represents as much as 72 percent of their overall business.
All participants were promised complete confidentiality. In all cases, we spoke to the CEO, GM or executive in charge of leading the commercial or overall sales effort. Most of the leaders were eager to participate, as they saw it as an opportunity to learn.
This article highlights key insights, including quotes from those with whom we spoke, to give PMPs a sense of our conversations. You also can link online to the full set of recommendations that we believe all leaders who want to see their commercial business grow should initiate. (See related story on page 140.)
We recognize that 16 professionals do not represent the complete views of the commercial market; however, we are confident that you will find alignment in the ideas they shared. We hope it motivates you to focus on the potential of the commercial segments and on the practices that are the building blocks for success. While the focus of the study was “commercial,” many of the ideas presented are equally applicable to improving your residential pest management business.
Key Insights. We found 11 key insights when performing our commercial pest management research:
1. A Bright Opportunity
There is significant opportunity for growth in the commercial segment. While many companies recognize it, their heritage and practices were focused more in the residential segments of their businesses. Based on these interviews, we believe it is the more progressive and forward-looking leaders who communicated their desire to focus on how to thrive in the commercial market. The market opportunity is BIG.
Here are some comments from our interviewees: (Editor’s note: comments follow in bullet points for each topic.)
- “The growth of commercial accounts has been the bright spot of the last several years.”
- “We have been very fortunate in our area — we are up 16 percent in commercial.”
- “Where relationships are strong, we have been able to retain the business. If not, more of a price focus exists today. The property managers we call on are putting on the squeeze.”
2. Top Challenges
While most organizations work hard to differentiate themselves, they are struggling to justify their pricing strategies. It is not because of lack of effort. Many companies invest a good part of their promotional budget to do so. While we saw some progress with selected companies, standing out remains an elusive challenge.
Team leaders also see the following challenges:
- “The biggest challenge we have is being able to differentiate ourselves since many view pest control as a commodity. This seems to be worse in the commercial environment, where the lowest bidder seems to be more dominant.”
- “Our challenge is the reluctance on the part of our salespeople to make cold calls on the ‘C-level suite’ executive. They just don’t have the confidence to do so.”
- “There is a price war going on out there. Customers have increased expectations of cost reduction and are challenging us to provide more services for the same price.”
3. Sales Process
As sales experts, we are disappointed in how few companies have actually defined a sales process or a sales methodology for their commercial teams. Sixty-seven percent of the participants do not have a documented process. Having a defined sales process can make the difference when approaching and selling to these bigger, more complex commercial accounts.
- “We do not have a specific sales process defined for commercial. We do quarterly sales meetings with the staff, but no documented process.”
- “We suck at it — all of our salespeople sell differently. Yes, they develop their own rhythm and style, which can be good, but it is still considered tribal knowledge.”
- “When the sales process IS reinforced systematically, that is when you see the best results.”
4. Development and Leadership
We were delighted to speak with executives who are building long-term competitive advantage by enhancing the leadership capability of their managers and building the skills of their salespeople. These companies were genuinely excited to share how they have built accountability, excitement and momentum with their commercial sales teams.
- “We attribute our success to having commercial sales managers in place who oversee, coach and challenge performance along the way.”
- “We have gotten serious about management competencies.”
- “We have a leadership program — it is pretty extensive. We have hired a corporate sales manager.”
5. Targeting and Gaining Access
Targeting and gaining access to the right person or persons influencing the commercial-buying decision is a continuing struggle. While all were implementing strategies to address this challenge, they recognize that significant effort and other creative strategies are still required to be more successful.
- “We have built an attitude to HUNT — to go after the account. We have created an aggressive positive attitude, paying more incentive for commercial vs. residential account acquisition. We view commercial accounts as a broader strategy that provides traction for our business overall.”
- “We have defined our targets better by areas: medical facilities, food-processing, retail — better segmentation and vertical strategies have made a big difference for us.”
6. Recruiting
The companies we felt were the most “forward-looking” put a premium on the caliber of the salespeople they recruit. Everyone recognizes that the salesperson is the face of the company, and this is even more essential with the commercial business customer. Some of the companies are exhibiting significant turnover, often due to poor hiring, or a pay structure that may not yield desired earnings. Research confirms that the cost of “onboarding” and retraining a commercial rep is significant.
- “We are obsessed with getting the best people possible right from the start — they need to fit our style on how we treat the customer.”
- “We want to hire salespeople who want to become trusted advisors.”
- “Put a sales manager in every office. The sales manager will be the key to our future.”
7. Business Acumen/Business Issues
Many struggled in answering our questions around how effective their people are at becoming “business advisors.” With the exception of a few participants, most had not focused on how to help their salespeople become better business men and business women. They see this as a future requirement, but most remain focused on more traditional approaches of “fixing the bug problem.”
- “We have not positioned ourselves related to business acumen.”
- “We are absolutely sales consultants — when you are proposing a solution to a 750,000 square-foot food warehouse — and the number of truck bays and the vast number of areas where pests can enter the facility...we absolutely need to be seen as consultant/advisors.”
- “LEED certification is huge right now and we have been able to capitalize.”
8. Metrics
While everyone certainly tracks “revenue,” very few establish additional scorecards for their commercial salespeople. Outside of revenue, few could provide precise numbers or metrics they focus on to drive goal achievement. On average, 52 percent of the representatives reporting within these companies made their numbers during the past year. Best-in-class sales organizations narrow in on five to seven “results” and “forward-looking predictive” metrics that they consistently use. There is significant opportunity for sales organizations to establish dashboards that measure performance around a variety of metrics.
- “We establish specific expectations with each rep on their “wheel of activity” — points are awarded when a sales person completes an activity — and managers then manage to the activity by rep. The objective is to create warm leads vs. cold calls. Our goal is for a rep to fill up 100 points of activities each day.”
9. Salesperson Excellence
We asked everyone to evaluate their salespeople against six different criteria on a five-point scale. While this was “anecdotal” in nature, here is a summary of how the commercial reps were evaluated as a whole:
Most of these executives felt good about the teams they had built over the years and gave them strong ratings in many of the categories we asked them to rate. Certainly, everyone felt pretty good about the ability of their people to create personal, trusting relationships. On the other hand, their ability to hunt, to consult and to educate suggests opportunities for improvement throughout.
10. Association Involvement
Involvement in commercial-related associations was not as high as we had expected. This certainly is due to its time-consuming nature. The payoff that results from association involvement, however, can be significant over the long haul.
- “We expect our salespeople to have some level of involvement in associations. How effective this is will vary. We have seen strong results over the years.”
11. If money and time were no object, where would you invest your effort and resources in order to accelerate growth?
One of our favorite questions in completing our interview is to ask the participant to “eliminate restrictions” and respond freely on what they would do if they were the sole decision maker with “money and time” not being a concern.
Often, that is where the best “wish list” can surface and is reflective of overall group sentiment. The list was wide and varied. We summarized the responses into the top five categories (above).
- “We must invest in resources to better train both sales and technical staff.”
- “We will put a sales manager in every office.”
- “Send each of my salespeople to learn more about the sales process.”
Conclusions. Interviewing 16 executives in-depth was a large undertaking. Each had strong opinions, and most are successful entrepreneurs who have lifted themselves and their companies “up from the bootstraps.” Many are much further down the road, and yet eager to get to the next level of performance.
Growth and execution are the quintessential strategies of every business executive. Our conclusion is that there is significant opportunity for each of you to be change agents with your team and with your company to capitalize on the commercial segments of the pest control industry. It is hard work. It requires disciplined effort. Yet, it will be a rewarding journey.
See www.saleseffectiveness.com/pestcontrolstudy for free access to the full report and recommended action strategies.
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