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I’m Bruce Frame and this is your One Minute on Business. This is the example part of wholesaling.
Many years ago, I worked with a wholesaler who was specializing in hospitality, cleaning
and janitorial products. He had four and a half thousand current customers on his database
and he had a sales rep on the road who was supposedly visiting all four and a half thousand
in a month. We worked out he could only be spending three minutes with a customer and
seriously all he can do in three minutes is stay at the front door and scream out [0:00:32]
[Phonetic] whatever he would want and as you can imagine, his sales were pretty ordinary.
What we did is we applied the ABCD rule to customers and go back and look at the other
blogs. You will find that one. We defined an A customer as someone who orders regularly,
pays their prices, refers others, comes back constantly and orders our entire range, uses
everything we sell.
We worked out that of his customer base there of the four and a half thousand, there were
32 who fitted in to both the A and B category and there were only three who are A category
customers. So I made a rule. You have to see the three A-grade customers every week. You
have to see all of the B-grade customers, 29. You had to see all of them within the
three week cycle. This business had a three week cycle. C-grade customers, you can only
talk to on the phone. You could ring them or they could ring you. D-grade customers,
unless they came to the door with cash or credit card, you’re not allowed to talk
to them at all.
That cut down his time that he spent on the road. That gave him more time with our best
customers and we doubled the turnover in 12 months. Would you like to double your turnover
in 12 months? Think about how you’re managing your customers and your stock and you will
have a great wholesaling business. Have a great day.