2020 has been a tough year for most distribution sales teams. In certain markets — such as janitorial and sanitation, HVAC, home improvement and landscaping — shifting consumption patterns have spurred rapid growth. Customers increasingly engage with suppliers through e-commerce, market platforms such as Amazon and Alibaba, and virtual meeting platforms. These new, emerging buyer and seller engagement models present compelling value and efficiencies that are certain to endure beyond the pandemic.

The Historical Role of Outside and Inside Sales Reps

In the traditional sales structure, outside sales reps were generalists who owned a particular geographic area within reasonable traveling distance and served a variety of customer types. In larger metro areas, to a modest degree, application/technical specialists supported the outside sales teams. Inside sales teams primarily answered inbound calls to place orders and source non-stock product requests. This model, predicated on driver sales reps, telephone ordering and local inventories, trundled along successfully for about 75 years.

In addition, each outside or inside seller was responsible for managing each sales opportunity (account or transaction, respectively) end-to-end. This was essentially the pre-Henry Ford world of horseless-carriage production, with each worker producing the entire sales opportunity on their own. Unfortunately, while this structure had a certain economic logic to it (simplicity and geographic efficiency), it largely failed to accomplish several important activities essential to organic revenue growth.

The Price of the High-Cost Sales Structure

This sales structure created significant constraints for customer value, productivity and organic growth. This resulted in the following:

• Relatively low productivity
• Inefficiencies in serving the customer
• Underwhelming new business development
• Inability to specialize by sales process stage, vertical market, application or product set.

A high-cost sales structure resulted that underserved customers and ultimately put at risk the livelihoods of a generation of sales reps. For many companies, the combined cost of distributed branches, outside reps with cars and inside reps in offices exceeded 20% of revenues. In an industry where gross margins commonly fluctuate between 25% and 30%, companies only received a net income of 5% or less. Essentially, the old branch and sales structure consumed almost as much value as it created, which suppressed profit and squeezed ability or propensity to invest for the future.

The Generational Shift in Sales and Buyer Behavior

Since 2000, as buyers embraced the internet and e-commerce, branch and sales structures remained stubbornly stuck in the 20th century. The internet effectively replaced the product binders outside sellers once used, and e-commerce replaced the fulfillment process inside sellers once served. Buyers still want to talk to sellers, but not about the tactical needs that traditional sellers address. They want to talk about the value the products will bring them and their businesses.

Buyers want to discuss with sellers about

• Insights about products or services that are new, complex or risky
• Solving technical or application problems that require specialized expertise
• Connecting products or services to improve process efficiencies or business outcomes.

Obviously, there are several implications to these behavioral shifts:

• What buyers seek has largely transcended what sellers have traditionally provided.
• The Sales DNA that worked in the past may not consistently exist in today’s sellers.
• Buyers require of sales reps new competencies that have not been part of the traditional sales talent selection and development processes.
• The sales structure needs to shift to simultaneously elevate customer value, leverage specialization and boost productivity. Essentially, the evolved modern buyer needs an evolved seller, which implies an evolved sales structure.

The Modern Distribution Sales Team for the Modern Buyer

To align with the modern buyer, sales structures need to evolve to embrace new sales roles that allow for specialization, productivity and evolving value-add beyond what is in the box.

New Role of Outside Sellers:

• Key account relationships
• Project/bid business
• Expanding share-of-wallet at the category level
• Hybrid remote / field customer engagement (depending on buyer preferences)

New Role of Field Technicians/Engineers:

• On-site technical support
• Configuration and solution design
• Hybrid remote / field customer engagement (depending on buyer preferences)

New Role of Insider Sellers:

• New business development: new accounts and/or expanding share-of-wallet
• Opportunity and customer management
• Outbound-oriented, scale-focused

New Role of Customer Service Reps (CSRs):

• Inbound-call order fulfillment
• Transactional cross-sell
• E-commerce support/quoting
• Order entry
• Remote technical support

With each role specialized and synchronized with the others, customer value rises, productivity improves and cost of sales declines. The modern seller connects with the modern buyer.

The Transition to Specialized Roles

With the shift in sales roles and structure, sales competencies must evolve as well. Binders and keyboards yield to new types of conversations, which in turn require distinctive Sales DNA and sales competencies that reps must possess to add value beyond what is in the box. Consider how this plays out by sales role.

Competencies of Outside Sales Reps:

• Relationship management
• Farming
• Consultative selling
• Advanced business acumen

Competencies of Inside Sales Reps:

• Hunting
• Consultative selling
• Business acumen

Competencies of Field Technicians/Engineers:

• Technical knowledge
• Consultative selling

Competencies of Customer Service Reps:

• Technical knowledge
• Tech savvy
• Negotiation

Due to once-in-a-generation health and economic disruptions, the evolving buyer needs that started around 2000 further accelerated during 2020. New modes of buyer–seller engagement have emerged. Many sellers will need to hand in their car keys and office IDs and learn to master virtual meeting formats. Managers will likewise need to revisit their sales management operating system to align with the new paradigm.

The Evolution of Sales Roles Is Here to Stay

The go-to-market transformation will go beyond sales roles. Branches will be consolidated into distribution centers. Outside sellers will work from home. Inside sellers and customer service reps will either work from centralized call centers or from home. The changes will be significant and challenging for many organizations to master. The benefits, however, will manifest as greater sales value to customers, better work–life balance for employees and new efficiencies that will accrue to everyone in the marketplace. If you’d like to explore how to modernize your sales approach to serve the modern buyer, please contact us.

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