One Blog |September 13, 2018 | POS Tracking Software

The Death of the Beer, Wine and Spirits Salesperson?

Mark Fullertion

The Death of the Beer, Wine and Spirits SalespersonAccording to Forrester Research, because of customers’ growing preference for on-line purchasing, it is predicted that as many as a million "b-to-b" salespeople could be cut by 2020.

Now, of course, all of these sales reps are not in the beverage-alcohol business, but a lot of them are.

Those beer, wine, and spirits reps particularly at risk are those who have, over time, become primarily order-takers, dropping by their customers on a weekly basis to see how many cases the retailer needs.

Often these reps use mobile computers to access the customer’s historical ordering habits to guide building the order — sometimes having scant little interaction with the actual customer, other than to inform the buyer what the computer has determined is the optimal order.

Feet on the Street?

There is a move underway for big distributors to put their actual sales reps — not their order-takers — into the top 20% of their customers, those accounting for about 80% of the distributors sales.

As some beleaguered distributors search for greater operational efficiencies, there are even examples of customers using a distributor’s on-line portal to place orders without a face-to-face meeting with a rep.

From a purely cost-motivated perspective, this would seem to suggest that 80% of a beverage-alcohol distributor’s customers may not require a weekly visit from a relatively expensive resource. This assumes that the sales rep’s primary function is keying orders into a mobile computer or accepting the recommendation of the distributor’s order fulfillment software.

If the compensation costs for your reps, all-in, are $60,000, cutting four of them can save you nearly a quarter-million dollars annually.

Of Course, It May Not Be That Simple

Some distributors do, of course, have order-takers. Some actually have order-takers who also spend most of their time working with their customers to introduce new products and create effective point-of-sale marketing programs.

These are the types of sales reps that retail customers rely on to help them grow their sales of existing brands and introduce new brands to the retailer’s customers.

But Time Waits for No-one

Nevertheless, trends, technology, and time marches forward.

There is naturally a bit of inevitability that has had the effect of allowing beverage-alcohol distributors to reduce their sales forces over the past five years, in some cases up to 30% even while their market size and sales have actually grown.

These distributors have focused more on the 20% of customers responsible for 80% of sales, but they have also adopted new e-commerce strategies, allowing them to spend less time on the process of ordering and more time in helping their customers in ways that provide measurable ROI, such as their POS advertising and promotional initiatives.

In some cases, outside sales reps have been reassigned as inside sales reps. Reassigning about 20% of outside sales reps who traditionally would call on the 80% of customers responsible for only 20% of sales has, in many cases, created tremendous efficiencies.

The Impact of POS Marketing and Tracking Software

Meanwhile, using POS tracking software to order, fulfill, and deliver both permanent and temporary POS items has assured their products are marketed effectively at large and small customers alike.

Some distributors are also using data analytics to help them forecast the potential impact of their POS programs, which also helps facilitate increased sales of their products both for their customers and themselves.

We Are Not Forecasting the Death of Sales Reps

Before you think, sales reps really are set to die off completely, no one literally sees salespeople becoming extinct.

Distributors, their suppliers, and most importantly their customers will continue to need knowledgeable sales reps to sell the ever-expanding portfolios of beers, wines, and spirits already on and coming on the market.

E-commerce is certainly able to automate some of the functions often associated with sales — or perhaps historically associated with sales. But, with hundreds of thousands of beverage-alcohol products available in the US alone, there will always be a need for sales reps to understand the products they sell and perhaps even more importantly, understand how to help their customers sell them to the actual shoppers at-retail.

As a growing number of our customers say, “Sales reps — not order-takers — will be used to help us retain and gain market share.” Here’s what distributors have told us:

"Our customers are looking for at-retail marketing help. They’re also looking for education on the dozens of new beers, wines, and spirits that come out practically every month; and, our customers are looking for the new products (and marketing materials) that will actually help them make money. Finally, our customers are looking to us distributors and our reps to not cost them time. Our customers are no longer interested in sales reps showing up every week to schmooze and chat them up.”

Beverage-alcohol has been proven, time and again, to be most successfully marketed at the time and place it’s sold.

That means in the retailers’ aisles, and in restaurants, and bars.

Here’s What We Know

Tracking, measuring, and managing your point-of-sale marketing gives you a competitive advantage and helps you retain and gain market share.

Which helps produce successful sales representatives. 

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For more information on how OnTrak’s POS Tracking Software helps distributors track, measure and manage their POS Marketing campaigns click on either of the following two links for find out what we know about:

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