Four Focus Areas to Building a Manufacturing Business!
Focus Area #1: Build Out Your Sales System and Upgrade Your Sales Team
For those manufacturers who rely on a sales force to sell their products (either directly to the end users of their products or through the sales channels that in turn sell their products), strengthening your sales system and upgrading your sales team is a big leverage point to grow your company.
- Your lead management system (to make sure all leads get identified, graded, and put into a reliable follow up process)
- Your baseline sales process (to make sure you scale your best practices on how to follow up with your leads, improve your sales scripting, and close more business.)
- Building and refining your system for finding, hiring, managing, coaching, and compensating your sales team.
- Layering in evergreen sales systems like formalized referral systems and reactivation strategies to spark past customers to buy again.
Building a Manufacturing Business
Chad Johnson, a past client in our Business Coaching Program had a challenge: one of his major customers (worth over $3 million a year of business) had a huge market reversal and as a result Chad’s company had lost over $2 million a year of business. He was down to one sales person and needed to grow sales.
We helped Chad redo his compensation plan and management strategy with his sales person which resulted in her increasing her sales by over 200% in 90 days!
One strategy we recommended was a formalized reactivation strategy. Using the defined offer we coached them through creating, Chad’s company reactivated two past clients bringing in $80,000 in sales in just 75 days! (Plus these clients were back buying from them.)
Focus Area #2: Build an Expert System to Help You Bid on More Work, Faster, and More Accurately
Does your company secure most of its orders through a bid, reverse auction, or “RFP” (request for proposals) process?
If so, one of the key things you can do to grow is to build an expert system that helps you find, grade, and quickly, efficiently, and accurately bid on more potential contracts.
In the beginning, most of our manufacturing Business Coaching clients who find most of their contracts through this type of process (as opposed to a dedicated sales force or other sales channels), have no scalable system to bid on the right projects at the right prices.
We regularly coach clients through building an “expert system” to do the following:
- Gather a larger pool of potential projects and contracts to bid on.
- Efficiently process through these potential projects, and based on a clear criteria, filter out which opportunities they should (and should not) bid on.
- Tap into your company’s best intelligence to know what price and terms to offer. (Normally this is simply drawn from an expert’s head in the company. Instead we help our clients to formalize this knowledge so that most, if not all, of it can be done independent of any one team member and expert.) Accuracy is the key here as you’ll be living with the terms of the contract you bid at for months or in many cases, years to come!
- A template driven process to package your bid with the correct languaging and format to both support your sales efforts and to protect yourself in the fine print.
Focus Area #3: Building a Successful Hiring and Retention System to Get and Keep the Right People
Most manufacture businesses struggle to find and keep the right talent.
Have you built your hiring process? Do you have a successful system for retaining your top talent? Both these are critical for successful manufacturers.
Past Client and Current Maui Advisor Stephanie Harkness– Former Chairperson of National Association of Manufacturers says:“Too many business owners are afraid of hiring better, smarter, more experienced team members to lead areas of their business, as if the presence of these team members threatens to eclipse the insecure owner. I’ve always believed in hiring top people and giving them the resources and support to do a world-class job. In fact, this has been the single biggest secret that Jack and I have discovered on our journey to Level Three.”
Focus Area #4: Strengthen the Financial Pillar of Your Company
8 out of 10 manufacturers that we work with in our Business Coaching Program initially have sub-par financial systems and controls.
This hurts them in 3 main ways:
- It hurts them when trying to manage cash flow. They don’t have the predictability of income and expenses that would allow them to make better, smarter, and more timely financial and strategic decisions.
- It hurts them when they go for financing to replace or secure new capital equipment.
- It hurts them in their collections – which radically reduces their sustainable growth rate. Yes they eventually get paid, but their receivables can stretch out for 60-90-120 days or more, simply because they don’t have a solid system in place.
What our manufacturing clients come to learn that because their businesses tend to be so capital intensive, building on a solid financial foundation is critical to make sure their growth is sustainable and to make smarter strategic decisions.