Who is selling what to whom?

One of the Elzabeth Frink stratues that used to greet salesmen visiting the WH Smith Retail Head Office in the 1980s
One of the Elzabeth Frink statues that  greeted salesmen visitng WH Smith Retail in the 1980s

I led a very successful team of retail buyers in the 1980s.  In only three years they improved our margins by over 3.5% of the retail selling price.

The salespeople we dealt with didn’t stand a chance.  As we were the market leader in most of our product categories, we were always looked after by the senior national accounts manager or the sales director – more often the latter, or that is what their business card said – whose status meant they were generally well into middle age.  They would arrive in their Ford Scorpios, which would always be reversed into a parking space so no-one could see whether they had the top of the range model or vanilla version without the bells and whistles.  In a less equal and inclusive age, they were almost universally male. In common with most people working in sales functions at the time, they were outwardly sociable types – you need to be comfortable with people if you are engaged in face-to-face selling – but whose roles condemned them to spend most of their time away from close colleagues, sitting in alone in a car as they headed off to schmooze their customers.  More than anything else, they needed to be liked and to please people.

Our buyers were almost the opposite. Sure, they were great colleagues and a privilege to work with, but they didn’t need to be liked.  They were the gate-keepers to some of the most profitable shelf space on the high street, and had a clear view of how they were going to make that space generate profit for the company.  They were highflyers who had been recruited into sought-after graduate jobs and were still in their twenties and early thirties, were mostly female and often blonde, and tough as nails.  Although we visited our suppliers’ factories and warehouses from time to time to understand their business, most of the key meetings took place on our turf.  And if all this had not already put the buyers on the front foot when it came to seeking discounts from the (remember, generally male and middle aged) salespeople, their adversaries in the negotiation had been unmanned on arrival by having to drive past four well-endowed nude male sculptures commissioned by the company’s chairman from Elizabeth Frink (subsequently sold by a successor lacking any insight into the commercial benefit they provided).

On a recent visit to New York, I recounted this to a Wall Street banker who deals in fixed interest securities, “selling” (his words) to large corporate customers (again, his words) who are raising debt.  He questioned my description of salespeople as needing to be liked. I had to explain that, although he was competing with other banks for the business of the big corporations, it was much less clear in his world who was doing the selling than when I was working for a market-leading high street retailer.  I have not worked as Chief Financial Officer or head of treasury in a big corporate, but I spent a significant amount of time trying to raise money from private equity investors and from suppliers of senior debt (to provide financial leverage for the ventures that I hoped would make my fortune). It was very clear who was selling what to whom – I had the investment opportunity and was trying to sell this to the people with the cash.  I wanted to be liked (or at least for them to like the risk-reward opportunity that I was pitching).  Although, subsequently, I found myself counselling entrepreneurs entertaining offers from venture capital firms that they should look beyond the cash that was on the table and to understand that the investor needed to demonstrate whether they would be attractive people to work with and add value to the business they were “buying” into (ie do a bit of selling), most of the time, the people with the cash needed persuading to buy the opportunity.

The Escondido Framework posits that all commercial transactions (and this spills over into non-commercial transactions – such as those in politics) involve both parties selling and both parties buying[1], albeit with the balance of power (particularly informed by competitive considerations and the availability of alternatives for one or other party to the transactions) influencing the degree it feels to the parties as though they are buying or selling.   This, of course, feeds through to what sort of people you need to charge with leading the transactions with the other party, how they should work, and what tools they need to do the job well.


[1] I have written elsewhere about the experience early in my career as strategic planning manager for WHSmith, working with WHSmith Wholesale, which was the dominant player in the UK distribution of newspapers and magazines.  The business thought of itself as having retail newsagents as its customers and newspaper and magazine publishers as its suppliers.  But, as evidenced by the way that the industry subsequently developed (all this, prior to emergence of on-line channels for news and for magazine content), the core role of the business was to provide a distribution service to the publishers, who were buying the distribution service rather than selling newspapers and magazines to a wholesaler.