more. I asked him, “Boss, if we
can grow sales from 30,000 units
to 150,000 units within a month,
do you think we would still be
working for this company? If we can
achieve that, we would be top-flight
consultants showing companies all
over the world how to grow sales by
500 per cent within a month.”
After a long laugh he said he
believed that if we sorted out
distribution we would be able to at
least achieve 120,000 units. I still
believed that was steep.
I started taking him through the
logical, analytical path to disapprove
his belief. Nationally, we had about
40,000 retail outlets. Assume,
instead of wasting money doing
other trade activities, we gave each
outlet a full unit of our products.
That would mean giving away
40,000 units and achieving 100
per cent distribution. That could be
done fairly quickly but would we
have achieved our target of 150,000
units? No! So, distribution was not
the only problem.
The problem was shelf off-take at
the retail level. Outlets that had
products took at least two weeks to
sell out one unit. At that rate, even
if distribution was at 100 percent,
sales would cap at 80,000 units per
month.
To achieve the 150,000 units target,
we ideally had to achieve 100
percent distribution with each outlet
selling at least one unit a week.
Achieving 100 percent distribution
is quite difficult even for popular
brands. To be realistic, at 50 percent
distribution, we needed each outlet
to sell 8 units a month to achieve
targets. That’s possibly where
discussions of strategies should have
started.
Anyway, we gave it our best shot
but as you can bet, we never went
beyond 32,000 units by month end.
I’ve got information the numbers
have not changed much to date.
They are surely ‘non compos mentis’
and if you have come across others,
the asylum for these managers must
sure be enlarged.
In such companies top management
does not know what they are doing,
and even if they know what they are
doing, they do not know what they
are doing is wrong and will never
achieve what they want. They don’t
have the capacity to interrogate
strategy’s ability to deliver results.
Herman Githinji is a Sales and
Marketing Consultant in Melbourne,
Australia. You can commune with him
on this or related issues via mail at:
[email protected] or read more
of his articles in his LinkedIn account