Are your sales costs too high?

Are your product managers bogged down validating quotes instead of promoting your products? Are unprofitable orders slipping through? Are quote errors driving down profits? You're not alone. Many manufacturers have the same problem. Solving these problems can increase your profit by at least 10%.

Say, for instance, you sell transformers. Your typical order size is about $5,000 with a margin of 10% on 50 orders a month. Your sales people don't have the tools to quote the right prices, so they throw it over the fence to your product manager. Right now, your product manager is spending three hours each day validating quotes, making sure that orders are configured properly and pricing is up to date. Even then, errors slip through and sometimes deep discounts cut into your margins and cost you money.

How does all of this impact your bottom line?

Three hours a day adds up. Over a month, that's 60 hours. 60 hours that could be spent promoting your products. Say you reduce the time to an hour a day. You're regaining 25% of the workday. That time could be used to meet with customers, attend trade shows, and promote the product. Even if this extra time only increases sales by 2 orders a month, that's a 4% increase in profit.

Now, say some quote errors or a couple of unprofitable deals slip through at -15% of cost. Those orders could drag your profit down by 6%. By correcting or eliminating these orders you can recapture lost profit. Just with this conservative estimate, you could increase profits by a total of 10%. What other initiatives do you have that could give you this kind of return?

How does K3 help?

With our solution, you can let your sales reps price products by themselves and then pass it over to a product manager to validate it. For example, prices for the transformer could be based upon installation, voltage, volume discounts, customer discounts, and other attributes. The price can be a cost rollup or value-add pricing. It may have many price tables and complex calculations such as service and installation costs. Or, it could be a multi-year contract with escalation pricing and guaranteed order quantities. All the sales rep has to do is enter the attributes of the order. The price is automatically calculated and compatibility rules are enforced. Then, a product manager can quickly validate the quotes to ensure any discounts are not undercutting profitability.

Worried about risk?

We eliminate risk before starting a project. First, we work with you and estimate how much money you can save. If there's no business case, we leave you alone. Next, we enter the pricing and compatibility rules for one of your product lines on our secure servers. Then, you have real-time access to a fully functional price-quoting system over the Internet. Best thing is, your already tapped out IT people never have to get involved, so no infrastructure cost and no maintenance. Then, we can keep on hosting it or you can move it back to your own servers. After three months, we will come back and calculate how much money we saved you. The projects are always well managed and you pay for performance based on the project plan.

Set up a free value assessment.

We feel strongly that we can increase your profit. We will provide a free value assessment. We will listen to you, understand your needs, and provide a qualified benefits statement of the value that can be achieved. You will receive a report of the analysis. Call (512) 342-9706 or e-mail rkinzy@k3group.com to set up a time that is convenient for you.