The German subsidiary of a global market leader in laboratory equipment had rested too long in its market-dominating role. The life science company in the field of laboratory equipment (analyzers, OEM) seemed outdated. The structures had not kept pace with the consolidating market. Sales were now stagnating and sales targets were in jeopardy. In addition, contribution margins were falling due to price losses, triggered by the steadily growing importance of key accounts. The company was also in danger of losing its technological edge in the market.
In this situation, the interim manager took over the restructuring as interim CRO and interim chief service management officer (interim CSMO).
Helped the key accounts sales team to achieve new effectiveness with training
In the weakness analysis, the interim manager recognized the key problem in sales. The key account managers in particular lacked self-confidence and business know-how. As a result, the key account sales team was giving away its margins in some areas. The buyers were very good at talking down the company's outstanding products. They had created a scenario that made the key account managers themselves believe that their employer was price-hungry.
This is where the interim manager came in with sales training and clear leadership. This not only motivated the sales teams, but also boosted their self-confidence, which in turn had a positive effect in negotiations with buyers on the customer side. As a result, the key account managers achieved higher sales volumes at higher prices with better margins.
Focused targeting improves success rate in field sales
The key success factor in field sales was a restructuring with accompanying, significantly more focused targeting. The interim CRO reduced the number of customers to be supported per employee. He also withdrew 2 headcounts and transferred them to a newly created structure of application consultants.
The pricing was revised for both sales forces and this was implemented in the market. This provided an incentive for customers to bundle purchasing activities with one supplier (cross-selling). The result was an increase in sales and margins.
Optimizations in the Technical Operation area reduce costs by 400,000 euros
In the course of the project, the interim manager was tasked with optimizing the Technical Operation area. He identified considerable optimization potential in the external warehouse. With more efficient merchandise management, the interim CRO realized cost reductions of 400,000 euros per year.
The interim manager realized further synergies by better linking the area and key account management field service with the technical operation area. The newly established application consultants were instrumental in improving this link and thus leveraging potential for the company and customers.
Margin losses halted and EBIT significantly increased in a stagnating market
After completing the mandate, the company now has sales structures in line with the market and pricing that generates good contribution margins. Margin losses have been halted. The new cross-selling increases turnover. The cost structure has also been streamlined.
The interim manager took on his role with a turnover of 42 million euros. after 12 months, it stands at 50 million euros - with an unchanged market volume. The EBIT margin increased by 3 percentage points.
One of the challenges in this project was that sales restructuring already puts people and the organization on high alert. When price and volume improvement measures are also being pursued at the same time, this often seems like a balancing act to those involved - or even a bloodbath. In this project, this basis was also spiced up by the fact that the company was the global market leader with an eroding market lead in a stagnating market.
