Customer inquiries and quotations have long been seen as traditional jobs of sales professionals. Field sales representatives visit customers and strive to get orders from them. When customers inquire, sales professionals are expected to answer with accurate information.
Trouble starts when sales professionals have no adequate answers to give. Sales professionals may know prices, terms, and promotions. But they may not know how much inventory is available to promise and when deliveries can be scheduled. They also may not know how to cater to special requests and instructions regarding product specifications and deliveries.
Sure, their superiors would have given field sales reps guidelines and information. Sales reps may also have fixed allocations of how much they can promise to deliver. But once they are in conversation with a customer, these guidelines and allocations may not be enough for a sales rep in discussion with a customer.
Sales reps have a lot of responsibilities. They have territories to cover and targets to meet. They promote products and negotiate contracts with customers. They seek and open new accounts and they are expected to submit sales reports. They also have to deal with complaints or worse, customers wanting to cancel orders or return products for refunds.
Sales representatives therefore expect their enterprise supply chains to deliver orders as promised. The last thing they need is late, incomplete deliveries or pending orders that never get fulfilled.
There’s a lot that’s been said about forecasting and managing demand, and a lot more about delivering orders. But not a whole lot about what happens in-between: when customers inquire about products, what are available, and request for quotations (RFQ).
In the many business meetings I’ve sat in, executives often ask what demand will be or how many orders are pending. They don’t ask much about what customers are saying or asking. Either they wait for their marketing people to mention anything or they just make conclusions on their own
In the retail business, store owners usually inquire from their suppliers about the availability of specific items, ask how much the prices would be, if the item can be delivered by what date, etc. In short, the store owners inquire and expect the suppliers’ sales people to answer.
Whereas demand forecasts offer projected sales of items in cumulative numbers for an upcoming time period, inquiries from customers tell enterprises what they are looking for. These inquiries can be and are valuable nuggets of information that can generate additional sales for an enterprise.
But from what I’ve seen and heard, this information never really reaches the enterprise’s executives. Either the information is forgotten or ignored. What reaches executives are reports that have filtered the feedback from customers.
I’ve observed there are five (3) stages to demand creation and fulfilment:
- After-Sales Service
Sales usually works exclusively on the first three. The supply chain typically works on the last two.
But the divisions of labour and accountability are more of formalities than realities in many cases.
When customers inquire (1st stage), they ask not only about price, promotions, and product features, they also ask:
- How many items do you have available?
- How fast can you deliver?
And when the sales person gives a quotation (2nd stage), the customer will ask again:
- How long will it take you to deliver?
- When will the items be delivered after I place my order?
And when the customer decides to order (3rd stage), he or she will ask the sales person once again:
- When will the ordered items arrive?
- How many will arrive?
It’s the same questions repeated at least three (3) times in those three (3) selling stages.
Sales people naturally wouldn’t be able to answer those two (2) questions without foreknowledge of what the supply chain will do when the orders are received. I’ve therefore observed that it’s common practice for sales people to call someone at the supply chain to get answers to those two (2) questions.
That someone can be anyone. It could be the one receiving the orders, the one who allocates items for delivery, the production planner, and any supply chain manager, or even all of these people all at once.
In many cases, the supply chain people the sales people call don’t have the answers either. And even if they did, they can’t or won’t guarantee the time and quantities of what would be delivered.
Sales people would press whomever they’re talking to for some answers which they then can provide to their customers. And in many times, the answers aren’t reliable or in the first place, aren’t authoritative.
The easy way out of this quandary is to formalise the participation of supply chain operations in the first stages of selling: inquiry, quotation, and order. This can be done via:
- Assigning people from the supply chain who’d know the answers to liaison with the sales people;
- Establishing a system to already reserve items that customers want quoted and allocate them when the order arrives.
It sounds hard and it will take quite some work to do #2 above. But given that there probably is an informal system of allocation working already between sales and supply chain, the enterprise would do well to just get it set up and running.
Note that in stages four and five, delivery and after-sales service, both supply chain and sales should still work together. Even as the supply chain would have a higher accountability in serving orders and providing some after-sales services (e.g., warranty services), sales should be in communication with customers about the status of deliveries, getting feedback, and collecting payments.
When sales and supply chain people work together in the five (5) stages of selling, they gain more confidence in responding to customer inquiries and requests. They learn what customers need as much as they find ways to improve serving orders and fulfilling demand.