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Best QUESTIONS…аre thоse thаt help yоu better understаnd the prоblems identified in your OBSERVATIONS and can be answered by your customer Arne Anderson! Q6: Select the “BEST 4” QUESTIONS you would ask the WESCo’s manager, Arne Anderson, in tomorrow morning’s follow up meeting. (12pts) A) Is there a reason for the low inventory of ACME small safes in your warehouse? B) Would you like for me to schedule small safe product/program training for your sales team? C) What do you like the most about the LOCKRIGHT brand and products? D) Would you be interested in a review of small safe price levels (ours to you... yours to your customers)? E) Has ACME failed to provide our standard branding & communication materials for your business? F) What do you want to accomplish with your business in the next 12 months? G) Are you aware that your small safe market share has declined each year since 2017? H) Would you be interested in doubling your large safe GM $s?
ACME COMPANY NARRATIVE: 1. Yоu аre а new Field Sаlespersоn fоr ACME Safe Company and you are replacing Wilbur Haag who was promoted to a National Account Manager position. 2. You’ve been assigned an existing sales territory with Wholesale Distributor customers who sell safes to other businesses. 3. This is your first trip around your territory visiting with your customers and prospective customers. 4. ACME has the #1 market share (~36% nationally but varies from market to market) of the small, less expensive (and lower margin: ~20% nationally) business safes. 5. ACME has a strong #2 market share (~25% nationally but varies from market to market) of the larger, more expensive (and higher margin: ~55% nationally) business safes. 6. ACME has recently introduced an expanded line of large, high margin safes with intention of growing this category's market share. 7. Additionally, a functional pricing discount program for ACME’s large, high margin safes has been recently introduced for those ACME distributors that carry both the small & large safes AND agree not to sell/stock competitive safe brands. This often results in customer gross margins for small and large safes to exceed 22% and 38%, respectively. 8. This new pricing program includes discounts for quantity buys, minimum stock-on-hand, and annual sales mix of high margin products. ACCOUNT SITUATION: 1. You are meeting for the first time with ACME’s Birmingham wholesale distributor, Warehouse Equipment & Supply Company (WESCo) that buys and re-sells ACME small safes to businesses. 2. WESCo has been a highly profitable ACME customer for 5 years. 3. You are meeting with the WESCo’s Manager, Arne Anderson who has been with WESCo for 6 years and has a reputation for liking the ACME brand and products and works well with our sales organization. 4. ACME has one other distributor in the Birmingham market, Birmingham Office Products, but does not stock our small or large safes and occasionally buys our small safes as needed for their customers. 5. ACME data indicates that the market for small, low cost safes has seen modest growth since 2017 of 8.6%. 6. ACME customer data indicates that WESCo’s purchases ($) of ACME small, low cost safes has seen a decline since 2017 of 5.2%. 7. Although Arne is a fan of ACME products, WESCo has bought and stocked LOCKRIGHT) large safes driven primarily by ACME's lack of a complete line of large safes for WESCo’s customers. ACCOUNT VISIT: Arne is excited to see you and you notice a few things during your visit: 1. ACME Safe related product banners, brochures and product guides seen in the sales desk area. 2. Warehouse was lightly stocked with ACME small safe products and heavily stocked with LOCKRIGHT large safes. 3. Arne is excited to see you because he's noticed a drop in his small safe sales since your predecessor (Wilbur Haag) was promoted to a National Account Manager and promptly left the territory 6 months ago, leaving Arne with no ACME sales representative. 4. Arne notes that when WESCo began carrying the ACME brand of small safes, Wilbur helped him develop a marketing plan each year that helped WESCo reach a leading share of the market in 2017. However, Wilbur did not help with plans for 2018 and 2019. Arne also expressed concern regarding the declining GM% he's able to earn on small safes. Arne's not sure if it's competitor pressures, but does know his price from ACME has gone up each year that he's been a customer. Wilbur indicated that WESCo's current small safe GM% of 14% was very reasonable for an ACME account with a strong small safe market share. 5. Arne does acknowledge that his LOCKRIGHT sales rep stops by often to manage his inventory including making purchase recommendations to keep the right product in stock. Arne also noted that he has a strong large safe market share of 23%, and achieves a 21% gross margin on these large safe sales. 6. Arne can't make it for dinner, but would like you to come back in the morning and meet with his sales team that is relatively new and did not benefit from the training and market planning that was done back in 2017 with Wilbur. Q3: Select the “BEST 5” OBSERVATIONS from the ACME Narrative, Account Situation and Visit to WESCo. (15pts) Best OBSERVATIONS…are those that have the most significant positive or negative impact on maximizing WESCo’s sales of ACME products! A) ACME has another Birmingham distributor, but not capable of being a market leader in business safe sales. B) Arne has seen declining GM% on his small safe sales since 2017. C) ACME recently launched a lucrative functional discount pricing program for those customers choosing ACME as their single-source for small and large business safes. D) It appears that Arne has experienced a good amount of turnover in his sales team since 2017. E) Arne has not had an ACME specific marketing plan to grow small safe sales since 2017 & no ACME sales support in 6 months. F) Appropriate brand and product communication materials were seen in WESCo's order desk area. G) ACME recently introduced a new and complete line of large safes. H) WESCo's warehouse was only lightly stocked w/ACME small safes. I) WESCo carries the LOCKRIGHT large safes and has a full inventory of the product. J) Wilbur assured Arne that a 14% GM on small safe sales was typical for ACME customers with leading market share.
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