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Top Desk: Looking Ahead to the New Year...And Beyond
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Top Desk: Looking Ahead to the New Year
and Beyond—Meeting the Needs of Your Customers
and Salesforce Today and Tomorrow
by Alan Luce

The end of the year always has been a time that requires top direct selling executives to divide their attention between two subjects and actions. The first imperative is to drive to finish the year as close to or beyond the profit plan as possible. Most, if not all, of the sales and promotional programs are in place and, it's hoped, the inventory forecasting and distribution plans can keep up with demand.

The nagging questions always are: What more can be done? What more should be done? How much last-minute tinkering is too much and will simply get in the salesforce's way?

The other and perhaps even more important imperative is to think through the coming year and beyond. I am not just talking about the budget and forecasting process. That is probably well along and, frankly, is necessarily based on the metrics of the last 12 months and earlier. The budget process is an important job and the process can be useful if it also makes you focus on the real issues: What will be the same about my business next year and beyond? More importantly, what has changed? Subtle changes in the marketplace seem to catch up with us every time! With hindsight it is always easy to identify the clues and ask ourselves how we could have missed something so obvious. But determining what needs to be changed in advance or, at least, catching a situation in progress so that changes can be made in a timely manner, is really tough. It takes hard probing, intense listening and an imaginative way of looking at your key operating metrics. Then, if you find something, you have to have the courage to pursue the issue and make the changes your investigation suggests.

By nature, direct selling companies are conservative and averse to change. The more successful we are as companies, the more conservative we become. This is partly due to the general business ethos of "If it ain't broke, don't fix it!" It is also partly due to the fact that too much of our selling environment intelligence is filtered through the eyes of our top field sales leaders. In my experience, top field leaders may be the poster children for resistance to change. There are exceptions, of course, but most field leaders got where they are by following one set of practices and by believing "Everything will be all right if we just get back to basics!" Sometimes they are right, of course. But more often, what neither they nor the company has realized is that something has changed in the market environment that will cause the public to no longer respond to the basics as they have in the past.

That is why I have taught myself to ignore the success data from the last 12 months and look underneath. Here are the issues I concentrate on to help me focus not on what is going right, but what may be beginning to go wrong.

Break some of your key macro indicators into more segmented pieces. You will be surprised at what you might see.

The macro "sales per customer" or "sales per party" numbers may still be climbing or flat, but what is happening at the micro level in your oldest and most penetrated markets? Geographic expansion is a wonderful thing for growth, yet it can often mask a developing product problem in your most established areas.

If, when you look at your longest established areas, you see that sales per customer is down versus the macro national figure or that the party average is down versus the macro national figure, it is often a sign that your salesforce is starving for innovative new products to sell.

Our salespeople resell old customers much more efficiently than they acquire new ones. When the product line begins to get stale, it will show up in four major statistics: sales per customer, party average, party attendance and bookings per party. You will also probably see your recruiting ratios drop in this local area.

Geographic expansion hides this developing problem because the higher sales, bookings and recruiting in new areas help hold up the macro national averages, even while rot is settling in older, local markets.

I recommend that you look primarily at the sales of new and part-time sellers in your oldest, most established markets to get an idea of what is going on and what may be coming to the whole company in the future. If those folks are having trouble, it will spread to the whole company in only a few more years.

Ask your newest recruits to tell you how things are going.

• Traditional person-to-person or party sales?
• What percentage of their business comes from non-traditional sales? Over the Internet? Virtual parties?
• How are they recruiting? Opportunity meetings? Online? Fairs and bazaars?
• What do they like best about the business? What do they like least?
• If they could change two things about selling for your company, what would they be?
• Are they having trouble getting customers? Hosts? Bookings? Why?

You will often be surprised by how much your newest recruits' descriptions of their businesses differs from what the upline leaders are telling you. These differences will often lead you to understand the need for changes that will make the business more attractive to new people.

You ignore these signs at your peril. I was working with one major party plan company that had consistently ignored the fact that their recruits were clamoring for online ordering and information services because the upline leaders did not want to change. It took a few down recruiting years to get them to finally see the light, but the information telling them what they needed to do was in their own survey data for five years or more before they hit the wall.

Your newest recruit and leader surveys combined with a close look at productivity statistics at the part-time seller level in your oldest markets will most often hold the keys to what you need to do next.

In my more than 30 years in the business, prospective salespeople have not changed much. They want:

An outstanding product that they love so much that they buy it for themselves. A sales and marketing plan that allows them to make some money for the time they have available to give to the business. Services that make things easy and uncomplicated. To be able to continue to sell to their customers using methods that the customers want to use.

The end of the year is my time to think about these things for the next year, the year after and so on. As companies, we will always be the most successful when we meet the business needs and expectations of our current and next generation of customers and salespeople. Our job as top managers is to find out what they want and then to provide it within our always-evolving direct selling models.

Good luck in 2007 and beyond!

Alan Luce is CEO of Wildtree, a direct selling company whose gourmet culinary blends, infused oils, dressings and sauces are sold through home parties. Luce is also President of Luce and Associates. Visit www.wildtree.com or www.luceandassociates.com.