Pulling the Curtain Aside to Sales Efficiency
Tasked to study a business that was not sales efficient in their area of responsibility. Data, specifically KPI’s, showed that this store was losing business to their competition. It was one of the lower-performing stores in a strong market. The brand data showed this store’s sales efficiency was 80%. Three surrounding stores within the brand were all above sales efficiency, showing within the same measures (-6%, -11%, -17% sales efficiency). The Pump-In numbers for this troubled store were a bit higher than they should be, but it was obvious they were losing business to other brand competition.
After first immersing myself in the team, there were no signs of any deficiencies. The owner spoke very highly of his managers and employees. The managers were supportive of their employees. Customer-facing employees seemed engaged and supportive of their workplace. Are there other elements that were contributing to lack of performance? Lack of advertising, bad reputation, negative social media reviews, pricing differences, different processes, facility, parking – everything seemed no different than the other stores. In fact, the facility was one of the nicest, the advertising was similar, had a cleaner look. No bad reputation and social media was 4.7/5.0, among the best. So, what is causing this lack of performance?
Over the next few weeks, I joined the team and observed. One of the first things I noticed was everyone seemed a bit defensive, and managers and salespeople were very protective of each other. Even the owner was so. We got access and reviewed cameras for traffic counts. There were more customers coming to the business than were logged into this store’s traffic counts. Salespeople were deciding who was, and was not “customers”. When disclosed the findings to the two managers and the owner, they were very defensive and reluctant to address and correct this situation.
Confronting the brutal facts, the two managers had very poor accountability skills and resisted conflict. Their personalities worked in opposition to their roles. The salespeople were controlling business, and the path of least resistance was their managers. Apparently, the brand representative had a similar conversation with them. A choice: A business of friendships and artificial harmony creating lost opportunity and lost profit -about a 30% continuous loss of business -with a multiplier in reverse? Or, a business of executing set processes with accountability, and enforcing and protecting the structure with disciplined actions, that drive profit and sustained growth? Eventually, this was corrected, by replacing two sales managers, installing processes that will prevent this, giving accountability to traffic counts, customer handling, and manager inclusion with the customers. The store is on its way to becoming sales efficient.