NEWS RELEASE June 2023
Assign Niche Responsibility to Each Salesman
The Most Profitable Market (MPM) is an aggregation of $10 million niches with a 20% market share. This program empowers top management with a foundation of business strategy. It empowers the local salesman to address and modify his expected contribution in individual niches.
By addressing the full range of air, water, energy products Mcilvaine can cost effectively supply the facts, factors, and forecasts in each individual niche.
- Annual market: $10 million
- Market share: 20% or $2 million
- EBITDA: 30%
- Sales promotion: 5% or $100,000
- Direct sales cost: 5% or $100,000
- Cost of one salesman/yr.: $1 million
- Number of niches needed to cover cost: 10
- Niches are divided into 10 sub niches: 100 sub-niches needed for one salesman
A salesman could be participating in 50 niches with an expected contribution of 1 to 5 sub-niches per niche.
The niche will be some combination of products, geographies, applications, and major purchasers. If the factors indicate that Amgen in California is targeted for some combination of niches or sub niches the local salesman becomes empowered to advise on the accuracy of the forecast. In fact, the sub-niche forecasts and the facts and factors can be shared by all those with the same niche responsibility.
The CFO will be pleased that the same level of detail will be applied to sales forecasting which is applied to cost forecasting. No company will be content to forecast the total cost of paint. So not only is the cost of paint for each product forecasted but the input of the painters is also sought to maximize the accuracy.
This approach can be implemented one niche at a time. To learn the details, click on this video https://youtu.be/poYMsHyIO7Q or the power point https://home.mcilvainecompany.com/images/Niche_Guide_for_Each_Salesman.pdf