Zellers Is s u e 06

J a n ua ry 2 0 10

Consulting
Group
Management
focus
Questions for 2010
Build More

As we emerge from the ugliest business year since the Great

PROFIT
Depression, many business owners are asking: in you Business!
The Zellers Consulting
“What Do We Do Now?” Group provides consult-
In an article published earlier this year, Bruce Wedderburn of ing and manage me nt
Huthwaite, Inc. (the creators of “Spin Selling”) contrasted the services to a growing list
questions their organization was hearing in the 4th quarter of of small business clients.
2007 (when the economy still appeared relatively strong) and the We offer our clients cus-
questions they heard at the beginning of 2009. tomized solutions linking
business information with
A look back at the 2007 and 2009 questions may provide
technology, strategy and
insight into creating effective strategies for 2010.
execution.
The Huthwaite article pointed out that in Q4 2007; companies
were looking for growth strategies and searching f or any Simply put, we make
competitive advantage. Business plans for 2008 were still
our clients:
projecting double-digit growth and territory expansions. Companies were investing in both
technology and human capital in order to accomplish their goals. Even though the selling
climate was tough, there was existing demand.  More Efficient
 More Competitive
The 2007 Questions  More Profitable

...and we
 How best can we expand our product line?
Guarantee our
 How do we capture new markets?
work!
 Where can we hire new sales reps to expand our coverage?
 How can we come up with creative compensation plans to keep our best people?
 How can we better leverage technology to drive increased growth?

Fast forward to the beginning of 2009

Existing demand in virtually all
market sectors had shrunk dramati-
cally. Potential buyers were more
than willing to live with existing
products, services, plants and
equipment. In fact, industrial
production capacity—the ability of
businesses to make products—fell
every month last year (2009), ac-
cording to Deutsche Bank chief U.S.
economist Joseph LaVorgna. By the
end of 2009, US industry was using
only 71% of the shrunken capacity,
compared with a long-term average
of 81%.

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 Is s u e 06

Zellers J a n ua ry 2 0 10

Consulting
Group
Management
focus
Our Expertise
The 2009 Questions
Strategic Planning

 Where can we scale back on spending? Productivity

 Can we get away with not spending what we’ve budgeted
Improvement
(or get out of contracts we’ve already signed)? Management by
 Can we get by with what we already have? Objective
 If we have to make a change, will it increase revenues or cut costs, Sales Team
and do it quickly?
Management
 If we have to make a change, can we do it internally?
Business
A Winning Strategy for Selling? Development
Gross Margin
Huthwaite pointed out that in the 2009 environment a selling
strategy based on proving to a buyer how and why your solu- Improvement
tions are better than the competition was irrelevant, because Process
potential customers were not buying – from anyone. Huthwaite
Re-Engineering
concluded that to sell in 2009, successful sellers were creating
demand, not simply responding to it. Instead of a marketing Leadership Coaching
strategy based on “Who we are and what we do”, the successful
strategies focused on provoking clients to think differently about Company Branding
their problems, needs and priorities. Product Marketing
Management
Top-performing salespeople in 2009 were those individuals who could: Training &
 Ask questions to uncover unrecognized problems Development
 Increase the size, urgency and severity of the buyer’s problems Lead Generation
 Present offerings to meet previously unacknowledged problems Program Creation
 Conduct value-based conversations around the buyer’s most pressing issues Inventory
Management &
Finally, top performers were better at securing executive-level appointments Re-Alignment
where they have a better opportunity to impact a client’s budget.
Performance-Based
Compensation Plans
What Do We Do Now?
We have entered the era of small business. Onetime GM
Coming in
president Charles Wilson once said "What's good for the
country is good for GM, and vice versa." Now, it is safe to future issues:
say that what is good for small business is good for the
country.
Where’s the Cash?
Small businesses now:
Fundamentals of
 Number almost 30 million
Inventory
 Employ more than half of all workers Management
 Constitute 99.7% of all employers
Direct Mail Marketing
 Constitute 97% of all exporters
Basics
 Create the majority of business innovations
(Source: U.S. Small Business Administration Office of Advocacy, 2009)
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 Is s u e 06

Zellers J a n ua ry 2 0 10

Consulting
Group
Management
Cautious Optimism
focus
From the
The state of the economy will continue to be the most significant trend effecting small business,
the small business outlook is both more optimistic and calmer - because things are slowly
desk of
getting back to, if not normal, at least something comprehensible. On the part of many entre- Ted Zellers
preneurs, there is new optimism because out of the 2009 rubble, an exciting, innovative start-
up economy is being born. More than ever before, small business will lead the way. Access to “To truly become a high
credit will be a determining factor – as many banks maintain tighter lending standards and performing company with
continue to redline companies that focus on the automotive sector. greater profitability, you
must plan for it, evaluate
Cash is Still King… f i n an c i a l p e r f o r m a n ce
and take action to ad-
Preserving cash will undoubtedly continue to be the #1 concern for many companies. Until dress problems as they
sales show sustained improvement and banks start lending at the local level, companies will
arise.
continue to manage their liquidity in a very conservative fashion.

To do this, you must

The New Frugality have accurate and timely

financial i n f o r m a t i o n,
which you understand
The bad economy, the burst of the housing bubble, continual high unemployment rates, and a and use to measure the
variety of other factors have coalesced to create an era of frugality. People are spending less, p e rf ormance of y our
saving more, and if they are shopping at all, they are looking for bargains. This pattern isn't business.”
going away any time soon. For the small business, this new pattern has several ramifications:
First, it's tougher to get people to spend, and to spend more. Second, you have to give people
what they want, and what they want are bargains.
For those of us in the

Less Liquidity business of helping other

businesses survive and
prosper, the greatest chal-
Increasingly small businesses will have to learn to get by on less, even while their financial bur- lenge may be initiating this
den grows. Fewer customers with less to spend, banks who won't make loans, tighter credit discussion with our clients.
generally, the end of the home equity ATM and more. The trend is less money to go around
(although it will undoubtedly be better than 2009), and the financial demands on small business At the Zellers Consulting
– from taxes to compliance – will continue to grow. Group, we believe making
clients more efficient and

Information is still Queen competitive is our primary

goal.

While preserving cash will probably continue to be the #1 concern for many companies, the
We can assist virtually any
2009 questions illuminate a plan that many companies will continue: A Consultative-Selling
client with a careful and
approach where your salespeople are actively engaged in helping customers identify and solve
problems. objective evaluation of their
direction and performance –
and if warranted – provide
Transforming the information you have – and then levering
them with the expertise to
that information into the decision cycle to increase effi- implement marketing, sales
ciency and effectiveness – is one of the greatest business and operational improve-
opportunities we see. ments that will make their
business more efficient and
more competitive.
www.zellersconsultinggroup.com
Questions or comments? Email us at: tzellers@zellersconsultinggroup.com or call 248-410-6882 Let’s make sure that our
© 2009 Zellers Consulting Group. All rights reserved. businesses (and our cli-
ents) stay strong and
Page 3 of 3 healthy.