Highly Cyclic Industrial Equipment Aftermarket Maintenance & Repairs Client Triples Off-Peak Sales

This privately held $4M maintenance services organization had been serving mission-critical industrial equipment operators in the pulp and paper, petrochemical, refining, and power generation industries for nearly a decade.

The nature of their industries and the equipment serviced resulted in an extremely cyclic demand for their services, as their customers did not typically perform equipment maintenance during the summer months. Therefore, any profits generated during peak months were typically burned up in overhead costs during the down-season.

Typical small company sales and marketing processes prevailed. Both processes had become reactive, and the opportunity pipeline had a horizon of less than three months. This period was shorter than the typical customers buying process cycle.

When Scott Trunkett first began serving this client, it was relatively profitable during its peak season, but overall annual financials were in the red.

This organization had developed a superior technical offering, and was able to perform a complete equipment maintenance cycle for its customers in less than half the time of its closest competitors.

Weak marketing, limited sales leadership, and a lack of understanding of the principles and techniques of selling unique economic value meant that this outstanding services organization had been unable to capture the value that it was creating in the market.

If this organization could capture its fair share of the unique economic value it created through value selling and increased pricing, it could strengthen contribution margins during peak season in order to better carry it through the off-season.

Additionally, by aggressively filling in its off-season backlog, it could further stabilize cash flow to become profitable.

Company ownership brought in Scott for sales process consulting and to perform ROS Diagnostics to identify ways to turn the company around from a loss position to profitability.

During the initial ROS diagnostic, Scott identified three critical initiatives that needed to be put into effect:

First, focus on capturing a fair share of UEV for existing customers by evolving the sales proposal process from one of Scope and Price to one of Benefits and Value.

Second, stabilize the business and stop the off-peak bleeding by designing and executing an aggressive marketing and selling program to identify, attract, and secure opportunities during the off-peak season.

Third, Focus on the future growth of the business by increasing the opportunity management horizon and selling process to more closely match the buying cycle of the market;

Scott began by facilitating the overhaul of the proposal document from a simple price quote to a branded and bound value-selling document with case studies and project timelines.

Instead of faxing a two-page price quote, which commoditized the offering, the client used Federal Express to further differentiated its value offering.

With the new proposal program in place, Scott then focused on developing the sales process for attracting and securing contracts during the off-season. Through several collaborative brainstorming sessions, a new marketing organization and incentive-based value selling process was developed.

Several new off-season contracts were secured at a positive contribution margin. Further, these initial contracts enabled the client to develop strong relationships with this highly valuable subset of off-season customers.

As projected, steady pricing increases supported by the new value-based proposal program were accepted with no loss in contract volume. Sales volumes and number of accounts increased steadily.

Several new customers who had previously declined business with the client because of its smallness, were attracted to the apparent bigness influenced by its new and highly professional sales proposal.

Within the first year, average gross margins were increased by nearly 30%, off- peak revenues more than tripled, and gross sales were up nearly 60%.

Financials of the company were turned around from a loss position to 18% ROS.