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Aqualisa quartz - Case study

The document outlines a sales presentation for Aqualisa Quartz, detailing sales objectives, market share analysis, and strategies targeting trade shops and plumbers in the Kingston upon Thames area. The forecast anticipates a significant increase in sales, emphasizing the need for education and relationship-building with plumbers to enhance product installation and awareness. Overall, it highlights the necessity of restructuring pricing and marketing approaches to capture a larger market share in a growing household environment.

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Raoul Gauthier K1560919 Sales presentation for the case product ( A q u ali sa Q u a rtz) Assignment 3
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3 Sales Objectives Sale planning 3 months 6 months 12 months Total Units - 158 474 632 Sales - 54,485 163,455 217,940 Cost per unit = 168 - -26,544 -79,632 -106,176 Discount - - - - Gross margin 27,941 83.823 111,764 According to the "HOUSING IN LONDON 2015” report the number of households in London is going to increase in the coming years (10% per decade). The net change in dwelling stock is also going up. Therefore it is reasonable to think that the turnover will increase in the future. 360 370 380 390 400 410 420 430 2 0 1 0 2 0 1 1 2 0 1 2 2 0 1 3 2 0 1 4 2 0 1 5 2 0 1 6 Million Baths and Sanitaryware : UK manufacturers’ sales 6% 6% of the total households in London are living in the KT area KT area’s Households 13% 13% of the total households in UK are London’s Households 40% In the KT area the turnover realized by manufacturers with the sale of digital shower is approximately of Market share digital showers £792,507.62 Aqualisa 40% Mira 40% Triton 15% ACTUAL MARKET SHARE (KT AREA) £317,003 I assume that Mira and Aqualisa are sharing a same portion of the market because of similarity between both products. Triton is less prevalent in this market than the others because of the quality, prices, and the channel of distribution used. There are other brands in Aqualisa that contribute to the market share, that is why I make the assumption that 50% are coming from the sales of Aqualisa Quartz. Objective: 55% of market share which represents a turnover of £217,940 for the Aqualisa Quartz Aqualisa Quartz Segment Retail Price MSP Cost Margin % Margin Actual situation premium 809 430 168 262 0.6096 Repositioning situation standard 649 345 168 177 0.5133 To be able to play on an other segment Aqualisa has to reduce its margin. 51,33% is the average margin between all Aqualisa’s product. The sales forecast evolves like an exponential 25% after 6 months and 75% during the last 6 months
4 Sales Environment Small Medium Large BusinesstoBusinessEnvironment KingstonuponThamesArea TradeShops 1 or 2 shops 3 to 5 shops More than 5 shops Turnover : under £25.9 million Turnover : Over £25.9 million over 250 employees Turnover : under £6.5 million less than 50 people less than 250 employees Thistypeofcompaniesisnot appropriatetoourcasestudy Strong buying power. They will the source of a majority of our turnover. More time has to be spent on those trade shops Buying power is limited in particular for high quality products, such as the Aqualisa Quartz Customers of trade shops are plumbers and individuals ( they are often oriented by plumbers).
5 Targets Justification 36% 8% 47% 9% Channels of distribution Do-it-yourself sheds Showrooms Trade shops Others Standard Showers Trade shops Plumbers Final customer 27 % 73% Aqualisa has to focus on trade shops selling standard showers because of its failure on the premium sector. Trade shops are the right target to approach in order to sell standard showers. Plumbers play a major role in the purchase behaviour of the final customers that’s why some efforts have to be made to educate them. As shown on the central schema they are two stakeholders who have to be targeted : Trade shops & plumbers. Targets Push vs Pull Slow vs Quick Adoption Trade Shops We should prioritize trade shops because the education of plumbers can be done through this channel. It will also request less effort due to the number of trade shops in comparison of the number of plumbers. PUSH METHOD Trade shops could adopt a product very quickly if they see an opportunity of profit. They don’t really have constraints preventing them from selling a new product. Quick Adoption Plumbers/Installers The education of plumbers to the utilization of our product is a pull strategy. This strategy is obviously primordial to keep a long term relationship with trade shops as well plumbers. Pull METHOD For plumbers it is more constraining to switch from a product to an other because of the learning curve that is associated with a new product. They have to be convinced and educated to new products which is a long process. Slow Adoption
6 Listing & Justification Targets Trade shops TUCKER FRENCH, Kingston T J BATHROOMS LTD, Thames Ditton NORDEN HEATING & PLUMBING, Epsom HARVEY FAB PLUMBING SUPPLIES EXCEL PLUMBING SUPPLIES LTD, Hersham STONELEIGH PLUMBING SUPPLIES, Stoneleigh HAMPTON BATHROOMS, Hampton CP HEATING & PLUMBING, Stoneleigh TRAVIS PERKINS, Leatherhead PATON OF WALTON, Walton-On-Thames Plumbers & Installers HILLS PROPERTY MAINTENANCE Riverside response B J W PLUMBING & HEATING Parkinson restauration s Ltd T H VINCENT BUILDING SERVICES J A B Heating REDFOX SERVICES Indrico limited ELLIOTT BUILDERS AJR Plumbing & heating CHRISTIAN JAMES BATHROOMS Complete heating & gas Ltd AZURE P H LTD PPM heating Services Limited RACE HEATING The happy boiler company SURREY-HANDYMAN.CO.UK LTD Paul Goodsen plumbing Brian Hurst Plumbing & Heating Andrew Callaghan Whythe heating and plumbing Multi skills UK Plumb Master Humble plumbing and heating Martin's Plumbing and heating Bathroom eleven limited Dab installation limited Plumb4U Glen Mumford & Plumbing service A&A plumbing & heating engineers Bull plumbing & heating services Waterways PHD Solutions Plumbing and heating LLP Longbow plumbing and heating Timothy Dolton plumbing & heating Ltd Hollands Heating & plumbing Ltd Legend: Already installing Aqualisa – Targets 10 trade shops meeting the criteria have been identified. Initially, it appears to not be enough to realise the gross margin forecasted, but some of the targets like Tucker French own more than one shop in the area. Overall, the average targeted sales per shop would be of 37 showers/year. In respect to the plumbers & installers, I have decided to target a maximum of those operating in the KT area because the approach will be less direct than with trade shops and will require less time. Nevertheless, 6 of them should be pampered because they are already installing some of Aqualisa’s products and aware of the quality of our product .There are approximate 190 plumbers or plumbing companies, which could be targeted when looking to generate both awareness and demand for the Quartz Digital in the KT area. Here are those with the best reputation.
7 DMU & DMP Trade shops Initiators Buyers (Purchasers) Influencers Decision Makers Users Gatekeepers Plumbers Shop owner Plumbers / Technician Shop owner Final customers/Plumbers SALES ASSISTANT, SUPERVISORS OR SECRETARESS (person who holds key information on the DMU/DMP) Assumptions & Justifications Due to the low amount of information concerning who the key decision makers are for each trade shops, it has been assumed that the ‘buying center’ will follow that indicated in the literature (Ellis, 2010). It has been assumed that all trade shops buying center will composed of the same components, that is why all trade shops has not been detailed. As the limited size of the shops being targeted , it assumed that as the people in these positions are identified, single individuals can occupied more than one of these role (Ellis, 2010).
8 DMU & DMP (identification) Find the gatekeepers • This information will be find on their website, via LinkedIn, Fame or by going in person to the shop and ask. Have contact with decision maker • This contact will be establish by asking to the gatekeepers to plan a meeting with deciders. Buyer • Once the decider is convinced, we will be directed to the buyer to close the sale
9 Geographical Concentration According to the map which is presenting our targets’ positions, they are relatively close to each other. The area of the circle is approximately 78.5 square miles which can be reasonably covered by a single sales representative. What we could do to reduce the transport expenses of our sales representative is to treat trade shops in the north area together and treat for trade shops in the south area together. North South
10 Sales Cycles Sept December June Aug Prospection Meetings Close Sales Follow-up According to me one long sales cycle is needed to achieve the first sale from a trade shop. However, after the first sale, sales cycles are going to become much faster because prospection and meetings have already made. Moreover, there are no real seasonality on the shower market. What will have an impact on our sales cycle is definitely the DMU because the sales agreement depends on the time when firms decide to buy their products. I have assume that they are ordering approximately 6 times a year to maintain stocks. That is why I believe reasonable that 3 others sales cycles could occur between March and August
11 Sales Visits (trade shops) Prospecting Appointment Making Preparation Ice Breaking Need Identification Presentation Negotiation and Objection Handling Closing the sale Processing the order Follow up 1 3 2 Here a lot of calls are made and emails are sent. It is the preparation needed before having a first meeting. 4 The sales representative will need a maximum of three meetings to secure a purchase commitment. The Aqualisa Quartz is not a very technical product which required a huge investment. The Aqualisa Quartz doesn’t change according to the target approached. According to the case study, Trade shops are small or medium, meaning that the amount of showers per client will be limited. The Fourth meeting will maybe be used for medium trade shops with several shops because the negotiations will probably include higher volume of showers.
12 Sales Visits (Plumbers) The purpose of the meetings with plumbers is not to sale them the shower but rather educate them to the installation of digital showers and to show how it can be profitable for them to install our showers. Two meetings will be enough to get a first in person contact with plumbers and to invite them personally to a workshop & a conference about the technology in the shower market. 1 2 The conference and the workshop3
13 Time Intervals (trade shops) The interval between the second and the third meeting could be a bit longer because an agreement has already been discussed during the second one. The third one should be essentially constituted of the contract conclusion. The last interval, if it occurs, is a period designed to review some closes of the contract. Sales representative does need a long period of time to fix the last details of the contract and could return very quickly to the target to finally close the deal. 1st Meeting 2nd Meeting 3rd Meeting 4th Meeting The interval between the first and the second meeting has to be long enough to analyse in detail the needs of the customer, to prepare a second presentation and to prepare an offer. But not to long so it is still present in the mind of the customer. 3 weeks – 5 weeks 4 weeks – 7 weeks 2 weeks – 5 weeks
14 Time Intervals (Plumbers) 1st Meeting 2nd Meeting As said previously, the purpose of having meetings with plumbers is to familiarize them with the technology available on the shower market and also to show them the benefits of such showers. To show that we are not in hurry so 4 months is reasonable time period so that they do not feel harassed. This interval will also enable the sales representative to communicate with a maximum number of plumbers. 4 Months
15 Sales objectives per call (trade shops) Prospecting Appointment Making Preparation Ice Breaking Need Identification Presentation Negotiation and Objection Handling Closing the sale Processing the order Follow up The first meeting is needed to get a first real contact with the target and understand their demand and needs. The sale representative will have to break the ice (establish confidence), present the Aqualisa Quartz for the first time and write down all the characteristics about the target. The final objective is to get a second interview not to sale. The second meeting is made to present the product in a way that will match the needs of the potential customer in order to begin to talk about the signature of a potential contract. The sale representative will have to face objections efficiently to have the opportunity to schedule a last meeting. If the customer has already been convinced during the first meeting a sale closure can occur. During the last meeting, the sale representative will come up with a proposition of contract responding to the need of the target. The client will probably make some last objections before actually close the sale. This additional meeting could occur in the case of medium trade shops with big financial resources to purchase high amount of showers. It could also occur when the representative faces a firm refusal during the first meeting. The objectives of this meeting are to get the things right and to close bigger sales Convinced Hesitant Time required Firm refusal Level of target interest
16 Sales objectives per call (Plumbers) Ice Breaking Need Identification Presentation Strengthen the relationship Negotiation and Objection Handling Book the reservation Invitation The first meeting is in majority to break the ice and build confidence between the sales representative and plumbers (this is the appropriate moment to collect a maximum of information about them). The second objective is to present the advantages of installing Aqualisa Quartz instead of other showers. Last but not least the sales person will have to talk about the conference and the workshop where they will be invited. The second meetings will be useful to collect feedbacks and opinions about the Aqualisa Quartz. It will be also the opportunity to strengthen the climate of trust to finally commit the plumber to assist at the conference and the workshop offered by Aqualisa. The Final objective of all the meetings is to ensure that a larger number of plumbers attending the conference about technology on the shower market and the workshop offered. The purpose of such a conference/workshop will be to enhance plumbers’ awareness of our brand and begin a long term relationship with them. With a such initiative we aim to increase the purchases of Aqualisa Quartz in our resellers’ shops.
17 Representative(s) Realistic gross margin objective in the KT area £111,764 Average wage for a sale representative £ 30,000 According to me, it is not a good investment to hire other representatives because of the low margin perspective in the KT area in comparison with a salesman's wage. Moreover £111,74 does not include the others expenses needed to realise sales (e.g. car expenses, promotional tools, … ). KT area has a surface of more or less 139 square miles. 12.5 11.2 Average wage at Aqualisa Product limited £ 35,768 Given the number of independents who will be targeted due too their real potential of sales, a second salesperson will be definitely a lost of money for the company. What could be conceivable is to hire a sales assistant, who will request a smaller salary given the national average which is £16,240, to help for the prospect and the follow up of our future clients. 1 sales representative will be the most profitable for the company in term of time and money because of the size of the area and the low sales perspectives.
18 Business Training Points 1 Sales’ Strategy Workshop Turn the spotlight on the expectations and the way of proceeding of the company. The products will be described in details ( features and benefits) and the sales environment (competition, targets,…) will be presented. The new recruits will participate in role playing exercises in preparation for sales situations (Ingram et al., 2015). 3 Psychology & Soft Skills Introduction to the neuro-linguistic-programming applied to sales situations and deepening body language. The way a sales person talks is very important to maximize the possibility to close sales. 2 Company’s Strategy Workshop One of the most important things for a new recruit, whatever the position, is to understand the strategy of the company and know where it is going. To have an efficient company, everybody inside has to be aware of the mission, the vision and the way it is doing things.
19 Hiring Talented Students Strong analytical skills To analyzed opportunities and be able to understand the market where he will be operating. Organized To have a good organization is the a key of a good relationship with potential clients. Cultural diversity To have sales representatives is a real plus because of the cultural diversity in London and the surrounding region. Sociable It is definitely one of the most important characteristic needed to be a good salesperson. Approach1 Talents will be approached at university (KT area) thought an attractive communication. Young people are dynamic and full motivation to achieve Call2 When an application is selected, our HR is calling the applicant to see his/her ability to sell his/herself by phone. It is essential to be confident, persuasive and get a friendly voice tone. Interview3 If the phone call is successful, the candidate is invited to prepare a case where he will analyze a potential customer and his needs and wants. During the interview he will be ask to him/her to expose and defend the chosen sale strategy. Being able to understand a situation and find the appropriate way to react is a key Sale Situation4 The last step is a role playing where the candidate has to sale a shower to a client in a face to face meeting in front of the sales manager who will have the last word on the hiring. It is also most of the time a critical stage in the sale cycle. It will enable the sales manager to see if the candidate has the ability keep a kind dialogue during the whole meeting even if it finish on a refusal.
20 Justification Salary Fix Starting Salary £15,000 Variable Salary Commission £15,000 to £33,000 Quota attained Total Payout 0% - 40% 20% 40% - 60% 35% 60% - 80% 75% 80% - 100% 100% 100% - 120% 120% I decided to pay the sales representatives via a system of semi-variable wage. Money is always a good way to motivate new employees. It is a real win-win situation where it could be highly profitable for both parties Max Salary The average salary at Aqualisa is about £32,805 according to the last 5 years reports available on FAME
21 Local Communication & Promotion Design of appropriated flyers destined to targeted plumbers through a marketing campaign (direct marketing) Creation of a video which shows how easy the Aqualisa Quartz is easy to use/Install. It will be defused in our client’s shops and on TV. Plumbers & InstallersTrades Shops Brand the sales representative’s car to advertise the company and promote the Aqualisa Quartz. Given that he will often be on the road, it is a good investment to increase the visibility of the brand. 2 weeks of big marketing campaign before the prospecting process via Adverts on billboards, poster sites and street panels. Through those adverts we aim to be present in our target’s subconscious. Our ads will be strategically positioned in the highest concentration of the trade shops.
22 Promotional Tools Business Cards Sales Brochures Video on Tablet Business cards are required to be as professional as possible and to give your contact details easily 500 business cards  £17 Sales brochures are very useful to assist the sales representative during a sale, it helps the target to visualize what the representative is talking about. 50 Booklets  £40 Video is a good tool to support a presentation and arguments. It is also good way to address to two of customer’s 5 senses. Important to keep in mind that some people are visual, other are more kinaesthetic and other are more auditory. 1 Video  £75 1 Tablet  £120 Shower Sample A sample is useful to convince kinaesthetic people who need to touch products. 1 Sample  FREE
23 Budget for Communication & Promotion Expenses Amounts Letters-Flyers £ 50 Video Production £ 150 Car branding £ 100 Business cards £ 17 Booklets £ 40 Tablet £ 120 Marketing campaign £ 1200 Total communication and marketing expenses £ 1677 To rent an emplacement (billboards) it cost £200/week all cost included. IPad Air (having already a mac it’s convenient) I assume that I will edit the video by my own. The £150 will be for the material. £ 50 is the price for 3000 flyers which is more than enough to prospect in the KT area.
24 Targeted Margin & Price Standrad shower Margin (%) Aquavalve 609 59 Aquasteam Thermostatic 50 Aquaforce 1.0/1.5 Bar 45 Average margin 51.33 Aqualisa Quartz Segment Retail Price MSP Cost Margin % Margin Actual situation premium 809 430 168 262 0.6096 Repositioning situation standard 649 345 168 177 0.5133 To be able to play on an other segment than the one of the premium showers Aqualisa has to reduce its margin. To be as realistic as possible I decided to use a margin of 51.33% which is the average margin between all Aqualisa’s products from the standard category. To find the sale price of the Aqualiza Quartz I had to match the MSP with the target margin of 51.33%. Once the MSP has been found, I have assumed that trade-shops will be able to achieve a margin of 46.22% on the Aqualiza Quartz which is above the average to stay attractive for them. AQUALIZA QUARTZ Trade Shops Final Customers/Plumbers £168 X2.05 X1.88 = £649 Final Price
25 Profit & Loss Spreadsheet Sales Scenario Break Even Pessimistic Realistic Optimistic Volume 157 380 506 632 Price per unit 345 345 345 345 Gross Turnover 54,165 131,100 174,570 217,940 Discounts 0 0 0 0 Net sales Costs of production (26,376) (63,840) (85,008) (106,176) Gross Margin 27,789 67260 89,532 111,764 Salary (18000) (20,250) (26,250) (30,000) Communication & marketing expenses (1,677) (1677) (1,677) (1,677) Travel expenses (1,000) (1000) (1,000) (1000) *Others expenses (7000) (7000) (7000) (7000) Total operating costs (27,677) (29,927) (35,927) (39,677) Operating Income 112 37333 53,605 72,087 Pre-tax income 112 37333 53,605 72,087 Tax (20%) 0 (7,466.6) (10,721) (14,417.4) Net Income 112 29,866.4 42,884 57,669.6 *Others expenses include restaurant, parking, laundry, telephone etc. In one year time a sales representative should reach the realistic net income of £ 42,884 To operate in the black and so cover fix costs he has to sale at least 157 units Summary Expectations are high to force our sales representative to work hard during the whole year to get a beautiful commission at the end. For a reason of simplicity I assume not doing discounts on average. Given the table the average price offered to our client of will be of £345. Quantity Price 0 - 20 £ 379.5 20 - 45 £ 345 45 - 70 £ 310.5
26 The Conclusion Sales Plan & Objectives According to turnover forecast realized, the KT area does not have a big potential and so will be cover by a single sales representative. The main objective is to win 15% of market share into the area through an active sales plan and a marketing campaign. To achieve this objective 506 showers have to be sold within the year. Environment & Opportunities The shower market is highly dependent on the housing market which is going well for the moment. Secondly, shower sales depend on the population, currently the population is not only increasing but also aging. Targets & Positioning Given the failure on the premium segment, Aqualisa has to reposition itself to be competitive and attractive. In the first instance trade shops will be targeted because of their importance in the standard segment where Aqulisa Quartz will be sold. Secondly, a particular attention will be paid to plumbers who are playing a big role in the shower selection process. Marketing Communication Three channels of communication will be used to reach our target before getting in touch with them. It will be like an unconscious preparation to a first sales call. One will be destined to reach plumbers, another one will be to approach trade shops, and the last one will be a more global marketing campaign. After the market and sales analysis, my general opinion on the sale of Aqualisa Quartz shower in the KT area, is that this geographical zone is too constraining for the company if we are not considering big trade shops which is the source of the biggest part of the forecasted turnover in the area.
27 References Aqualisa (2016) Features & Price Aqualisa Quartz digital shower. Available at: http://www.aqualisa.co.uk/showers (Accessed: 15 march 2016) Bristan (2016) Features & Price Bristan Artisan Digital Electronic. Available at: http://www.bristan.com (Accessed: 15 march 2016) Fame (2016) Aqualisa financial data. Available at: http://www.fame.bvdinfo.com (Accessed: 2 April 2016) Galaxy (2016) Price GRS1 digital shower. Available at: https://www.galaxy-showers.com (Accessed: 15 march 2016) Instantprint (2016) Booklets price. Available at: https://www.instantprint.co.uk/booklets (Accessed: 29 march 2016) Key Note (2015) ‘Bath & Sanitaryware market report’. Available at: http://www.keynote.co.uk (Accessed: 15 march 2016) London DataStore (2015) ‘London Housing Market Report’. Available at: http://data.london.gov.uk/housingmarket (Accessed: 15 march 2016) London DataStore (2014) ‘Population projections’. Available at: http://data.london.gov.uk/demography/population-projections (Accessed: 1 march 2015) Mira (2016) Features & Price Mira Platinum Ceiling digital shower. Available at: http://www.mirashowers.co.uk (Accessed: 15 march 2016) Nick Ellis (2011), ‘Business-to-Business Marketing : relationships, networks and strategies’, Oxford: Oxford University Press O2 (2016) Ipad Air 2 price. Available at: https://www.o2.co.uk/shop/tablets/apple/ipad-air-2 (Accessed: 29 march 2016) Signkick (2016) Billboards rental . Available at: https://www.signkick.co.uk (Accessed: 2 April 2016) Totaljob (2015) Salary sales representative. Available at: http://www.totaljobs.com/salary-checker/average-sales-representative-salary (Accessed: 2 April 2016) Triton (2016) Features & Price Triton Satelite Digital Mixer Shower. Available at: https://www.tritonshowers.co.uk (Accessed: 15 march 2016) Trustatrader(2016) Plumbers in the KT area. Available at: http://www.trustatrader.com (Accessed: 29 march 2016) Vistaprint (2016) Business cards price. Available at: http://www.vistaprint.co.uk (Accessed: 29 march 2016)

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Aqualisa Presentation
byPranshul Chauhan
 

Aqualisa quartz - Case study

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    Raoul Gauthier K1560919 Sales presentationfor the case product ( A q u ali sa Q u a rtz) Assignment 3
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    3 Sales Objectives Sale planning 3 months 6 months 12 monthsTotal Units - 158 474 632 Sales - 54,485 163,455 217,940 Cost per unit = 168 - -26,544 -79,632 -106,176 Discount - - - - Gross margin 27,941 83.823 111,764 According to the "HOUSING IN LONDON 2015” report the number of households in London is going to increase in the coming years (10% per decade). The net change in dwelling stock is also going up. Therefore it is reasonable to think that the turnover will increase in the future. 360 370 380 390 400 410 420 430 2 0 1 0 2 0 1 1 2 0 1 2 2 0 1 3 2 0 1 4 2 0 1 5 2 0 1 6 Million Baths and Sanitaryware : UK manufacturers’ sales 6% 6% of the total households in London are living in the KT area KT area’s Households 13% 13% of the total households in UK are London’s Households 40% In the KT area the turnover realized by manufacturers with the sale of digital shower is approximately of Market share digital showers £792,507.62 Aqualisa 40% Mira 40% Triton 15% ACTUAL MARKET SHARE (KT AREA) £317,003 I assume that Mira and Aqualisa are sharing a same portion of the market because of similarity between both products. Triton is less prevalent in this market than the others because of the quality, prices, and the channel of distribution used. There are other brands in Aqualisa that contribute to the market share, that is why I make the assumption that 50% are coming from the sales of Aqualisa Quartz. Objective: 55% of market share which represents a turnover of £217,940 for the Aqualisa Quartz Aqualisa Quartz Segment Retail Price MSP Cost Margin % Margin Actual situation premium 809 430 168 262 0.6096 Repositioning situation standard 649 345 168 177 0.5133 To be able to play on an other segment Aqualisa has to reduce its margin. 51,33% is the average margin between all Aqualisa’s product. The sales forecast evolves like an exponential 25% after 6 months and 75% during the last 6 months
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    4 Sales Environment Small MediumLarge BusinesstoBusinessEnvironment KingstonuponThamesArea TradeShops 1 or 2 shops 3 to 5 shops More than 5 shops Turnover : under £25.9 million Turnover : Over £25.9 million over 250 employees Turnover : under £6.5 million less than 50 people less than 250 employees Thistypeofcompaniesisnot appropriatetoourcasestudy Strong buying power. They will the source of a majority of our turnover. More time has to be spent on those trade shops Buying power is limited in particular for high quality products, such as the Aqualisa Quartz Customers of trade shops are plumbers and individuals ( they are often oriented by plumbers).
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    5 Targets Justification 36% 8% 47% 9% Channels ofdistribution Do-it-yourself sheds Showrooms Trade shops Others Standard Showers Trade shops Plumbers Final customer 27 % 73% Aqualisa has to focus on trade shops selling standard showers because of its failure on the premium sector. Trade shops are the right target to approach in order to sell standard showers. Plumbers play a major role in the purchase behaviour of the final customers that’s why some efforts have to be made to educate them. As shown on the central schema they are two stakeholders who have to be targeted : Trade shops & plumbers. Targets Push vs Pull Slow vs Quick Adoption Trade Shops We should prioritize trade shops because the education of plumbers can be done through this channel. It will also request less effort due to the number of trade shops in comparison of the number of plumbers. PUSH METHOD Trade shops could adopt a product very quickly if they see an opportunity of profit. They don’t really have constraints preventing them from selling a new product. Quick Adoption Plumbers/Installers The education of plumbers to the utilization of our product is a pull strategy. This strategy is obviously primordial to keep a long term relationship with trade shops as well plumbers. Pull METHOD For plumbers it is more constraining to switch from a product to an other because of the learning curve that is associated with a new product. They have to be convinced and educated to new products which is a long process. Slow Adoption
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    6 Listing & JustificationTargets Trade shops TUCKER FRENCH, Kingston T J BATHROOMS LTD, Thames Ditton NORDEN HEATING & PLUMBING, Epsom HARVEY FAB PLUMBING SUPPLIES EXCEL PLUMBING SUPPLIES LTD, Hersham STONELEIGH PLUMBING SUPPLIES, Stoneleigh HAMPTON BATHROOMS, Hampton CP HEATING & PLUMBING, Stoneleigh TRAVIS PERKINS, Leatherhead PATON OF WALTON, Walton-On-Thames Plumbers & Installers HILLS PROPERTY MAINTENANCE Riverside response B J W PLUMBING & HEATING Parkinson restauration s Ltd T H VINCENT BUILDING SERVICES J A B Heating REDFOX SERVICES Indrico limited ELLIOTT BUILDERS AJR Plumbing & heating CHRISTIAN JAMES BATHROOMS Complete heating & gas Ltd AZURE P H LTD PPM heating Services Limited RACE HEATING The happy boiler company SURREY-HANDYMAN.CO.UK LTD Paul Goodsen plumbing Brian Hurst Plumbing & Heating Andrew Callaghan Whythe heating and plumbing Multi skills UK Plumb Master Humble plumbing and heating Martin's Plumbing and heating Bathroom eleven limited Dab installation limited Plumb4U Glen Mumford & Plumbing service A&A plumbing & heating engineers Bull plumbing & heating services Waterways PHD Solutions Plumbing and heating LLP Longbow plumbing and heating Timothy Dolton plumbing & heating Ltd Hollands Heating & plumbing Ltd Legend: Already installing Aqualisa – Targets 10 trade shops meeting the criteria have been identified. Initially, it appears to not be enough to realise the gross margin forecasted, but some of the targets like Tucker French own more than one shop in the area. Overall, the average targeted sales per shop would be of 37 showers/year. In respect to the plumbers & installers, I have decided to target a maximum of those operating in the KT area because the approach will be less direct than with trade shops and will require less time. Nevertheless, 6 of them should be pampered because they are already installing some of Aqualisa’s products and aware of the quality of our product .There are approximate 190 plumbers or plumbing companies, which could be targeted when looking to generate both awareness and demand for the Quartz Digital in the KT area. Here are those with the best reputation.
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    7 DMU & DMP Tradeshops Initiators Buyers (Purchasers) Influencers Decision Makers Users Gatekeepers Plumbers Shop owner Plumbers / Technician Shop owner Final customers/Plumbers SALES ASSISTANT, SUPERVISORS OR SECRETARESS (person who holds key information on the DMU/DMP) Assumptions & Justifications Due to the low amount of information concerning who the key decision makers are for each trade shops, it has been assumed that the ‘buying center’ will follow that indicated in the literature (Ellis, 2010). It has been assumed that all trade shops buying center will composed of the same components, that is why all trade shops has not been detailed. As the limited size of the shops being targeted , it assumed that as the people in these positions are identified, single individuals can occupied more than one of these role (Ellis, 2010).
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    8 DMU & DMP(identification) Find the gatekeepers • This information will be find on their website, via LinkedIn, Fame or by going in person to the shop and ask. Have contact with decision maker • This contact will be establish by asking to the gatekeepers to plan a meeting with deciders. Buyer • Once the decider is convinced, we will be directed to the buyer to close the sale
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    9 Geographical Concentration According tothe map which is presenting our targets’ positions, they are relatively close to each other. The area of the circle is approximately 78.5 square miles which can be reasonably covered by a single sales representative. What we could do to reduce the transport expenses of our sales representative is to treat trade shops in the north area together and treat for trade shops in the south area together. North South
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    10 Sales Cycles Sept DecemberJune Aug Prospection Meetings Close Sales Follow-up According to me one long sales cycle is needed to achieve the first sale from a trade shop. However, after the first sale, sales cycles are going to become much faster because prospection and meetings have already made. Moreover, there are no real seasonality on the shower market. What will have an impact on our sales cycle is definitely the DMU because the sales agreement depends on the time when firms decide to buy their products. I have assume that they are ordering approximately 6 times a year to maintain stocks. That is why I believe reasonable that 3 others sales cycles could occur between March and August
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    11 Sales Visits (tradeshops) Prospecting Appointment Making Preparation Ice Breaking Need Identification Presentation Negotiation and Objection Handling Closing the sale Processing the order Follow up 1 3 2 Here a lot of calls are made and emails are sent. It is the preparation needed before having a first meeting. 4 The sales representative will need a maximum of three meetings to secure a purchase commitment. The Aqualisa Quartz is not a very technical product which required a huge investment. The Aqualisa Quartz doesn’t change according to the target approached. According to the case study, Trade shops are small or medium, meaning that the amount of showers per client will be limited. The Fourth meeting will maybe be used for medium trade shops with several shops because the negotiations will probably include higher volume of showers.
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    12 Sales Visits (Plumbers) Thepurpose of the meetings with plumbers is not to sale them the shower but rather educate them to the installation of digital showers and to show how it can be profitable for them to install our showers. Two meetings will be enough to get a first in person contact with plumbers and to invite them personally to a workshop & a conference about the technology in the shower market. 1 2 The conference and the workshop3
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    13 Time Intervals (tradeshops) The interval between the second and the third meeting could be a bit longer because an agreement has already been discussed during the second one. The third one should be essentially constituted of the contract conclusion. The last interval, if it occurs, is a period designed to review some closes of the contract. Sales representative does need a long period of time to fix the last details of the contract and could return very quickly to the target to finally close the deal. 1st Meeting 2nd Meeting 3rd Meeting 4th Meeting The interval between the first and the second meeting has to be long enough to analyse in detail the needs of the customer, to prepare a second presentation and to prepare an offer. But not to long so it is still present in the mind of the customer. 3 weeks – 5 weeks 4 weeks – 7 weeks 2 weeks – 5 weeks
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    14 Time Intervals (Plumbers) 1stMeeting 2nd Meeting As said previously, the purpose of having meetings with plumbers is to familiarize them with the technology available on the shower market and also to show them the benefits of such showers. To show that we are not in hurry so 4 months is reasonable time period so that they do not feel harassed. This interval will also enable the sales representative to communicate with a maximum number of plumbers. 4 Months
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    15 Sales objectives percall (trade shops) Prospecting Appointment Making Preparation Ice Breaking Need Identification Presentation Negotiation and Objection Handling Closing the sale Processing the order Follow up The first meeting is needed to get a first real contact with the target and understand their demand and needs. The sale representative will have to break the ice (establish confidence), present the Aqualisa Quartz for the first time and write down all the characteristics about the target. The final objective is to get a second interview not to sale. The second meeting is made to present the product in a way that will match the needs of the potential customer in order to begin to talk about the signature of a potential contract. The sale representative will have to face objections efficiently to have the opportunity to schedule a last meeting. If the customer has already been convinced during the first meeting a sale closure can occur. During the last meeting, the sale representative will come up with a proposition of contract responding to the need of the target. The client will probably make some last objections before actually close the sale. This additional meeting could occur in the case of medium trade shops with big financial resources to purchase high amount of showers. It could also occur when the representative faces a firm refusal during the first meeting. The objectives of this meeting are to get the things right and to close bigger sales Convinced Hesitant Time required Firm refusal Level of target interest
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    16 Sales objectives percall (Plumbers) Ice Breaking Need Identification Presentation Strengthen the relationship Negotiation and Objection Handling Book the reservation Invitation The first meeting is in majority to break the ice and build confidence between the sales representative and plumbers (this is the appropriate moment to collect a maximum of information about them). The second objective is to present the advantages of installing Aqualisa Quartz instead of other showers. Last but not least the sales person will have to talk about the conference and the workshop where they will be invited. The second meetings will be useful to collect feedbacks and opinions about the Aqualisa Quartz. It will be also the opportunity to strengthen the climate of trust to finally commit the plumber to assist at the conference and the workshop offered by Aqualisa. The Final objective of all the meetings is to ensure that a larger number of plumbers attending the conference about technology on the shower market and the workshop offered. The purpose of such a conference/workshop will be to enhance plumbers’ awareness of our brand and begin a long term relationship with them. With a such initiative we aim to increase the purchases of Aqualisa Quartz in our resellers’ shops.
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    17 Representative(s) Realistic gross marginobjective in the KT area £111,764 Average wage for a sale representative £ 30,000 According to me, it is not a good investment to hire other representatives because of the low margin perspective in the KT area in comparison with a salesman's wage. Moreover £111,74 does not include the others expenses needed to realise sales (e.g. car expenses, promotional tools, … ). KT area has a surface of more or less 139 square miles. 12.5 11.2 Average wage at Aqualisa Product limited £ 35,768 Given the number of independents who will be targeted due too their real potential of sales, a second salesperson will be definitely a lost of money for the company. What could be conceivable is to hire a sales assistant, who will request a smaller salary given the national average which is £16,240, to help for the prospect and the follow up of our future clients. 1 sales representative will be the most profitable for the company in term of time and money because of the size of the area and the low sales perspectives.
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    18 Business Training Points 1 Sales’Strategy Workshop Turn the spotlight on the expectations and the way of proceeding of the company. The products will be described in details ( features and benefits) and the sales environment (competition, targets,…) will be presented. The new recruits will participate in role playing exercises in preparation for sales situations (Ingram et al., 2015). 3 Psychology & Soft Skills Introduction to the neuro-linguistic-programming applied to sales situations and deepening body language. The way a sales person talks is very important to maximize the possibility to close sales. 2 Company’s Strategy Workshop One of the most important things for a new recruit, whatever the position, is to understand the strategy of the company and know where it is going. To have an efficient company, everybody inside has to be aware of the mission, the vision and the way it is doing things.
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    19 Hiring Talented Students Stronganalytical skills To analyzed opportunities and be able to understand the market where he will be operating. Organized To have a good organization is the a key of a good relationship with potential clients. Cultural diversity To have sales representatives is a real plus because of the cultural diversity in London and the surrounding region. Sociable It is definitely one of the most important characteristic needed to be a good salesperson. Approach1 Talents will be approached at university (KT area) thought an attractive communication. Young people are dynamic and full motivation to achieve Call2 When an application is selected, our HR is calling the applicant to see his/her ability to sell his/herself by phone. It is essential to be confident, persuasive and get a friendly voice tone. Interview3 If the phone call is successful, the candidate is invited to prepare a case where he will analyze a potential customer and his needs and wants. During the interview he will be ask to him/her to expose and defend the chosen sale strategy. Being able to understand a situation and find the appropriate way to react is a key Sale Situation4 The last step is a role playing where the candidate has to sale a shower to a client in a face to face meeting in front of the sales manager who will have the last word on the hiring. It is also most of the time a critical stage in the sale cycle. It will enable the sales manager to see if the candidate has the ability keep a kind dialogue during the whole meeting even if it finish on a refusal.
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    20 Justification Salary Fix StartingSalary £15,000 Variable Salary Commission £15,000 to £33,000 Quota attained Total Payout 0% - 40% 20% 40% - 60% 35% 60% - 80% 75% 80% - 100% 100% 100% - 120% 120% I decided to pay the sales representatives via a system of semi-variable wage. Money is always a good way to motivate new employees. It is a real win-win situation where it could be highly profitable for both parties Max Salary The average salary at Aqualisa is about £32,805 according to the last 5 years reports available on FAME
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    21 Local Communication &Promotion Design of appropriated flyers destined to targeted plumbers through a marketing campaign (direct marketing) Creation of a video which shows how easy the Aqualisa Quartz is easy to use/Install. It will be defused in our client’s shops and on TV. Plumbers & InstallersTrades Shops Brand the sales representative’s car to advertise the company and promote the Aqualisa Quartz. Given that he will often be on the road, it is a good investment to increase the visibility of the brand. 2 weeks of big marketing campaign before the prospecting process via Adverts on billboards, poster sites and street panels. Through those adverts we aim to be present in our target’s subconscious. Our ads will be strategically positioned in the highest concentration of the trade shops.
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    22 Promotional Tools Business Cards SalesBrochures Video on Tablet Business cards are required to be as professional as possible and to give your contact details easily 500 business cards  £17 Sales brochures are very useful to assist the sales representative during a sale, it helps the target to visualize what the representative is talking about. 50 Booklets  £40 Video is a good tool to support a presentation and arguments. It is also good way to address to two of customer’s 5 senses. Important to keep in mind that some people are visual, other are more kinaesthetic and other are more auditory. 1 Video  £75 1 Tablet  £120 Shower Sample A sample is useful to convince kinaesthetic people who need to touch products. 1 Sample  FREE
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    23 Budget for Communication& Promotion Expenses Amounts Letters-Flyers £ 50 Video Production £ 150 Car branding £ 100 Business cards £ 17 Booklets £ 40 Tablet £ 120 Marketing campaign £ 1200 Total communication and marketing expenses £ 1677 To rent an emplacement (billboards) it cost £200/week all cost included. IPad Air (having already a mac it’s convenient) I assume that I will edit the video by my own. The £150 will be for the material. £ 50 is the price for 3000 flyers which is more than enough to prospect in the KT area.
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    24 Targeted Margin &Price Standrad shower Margin (%) Aquavalve 609 59 Aquasteam Thermostatic 50 Aquaforce 1.0/1.5 Bar 45 Average margin 51.33 Aqualisa Quartz Segment Retail Price MSP Cost Margin % Margin Actual situation premium 809 430 168 262 0.6096 Repositioning situation standard 649 345 168 177 0.5133 To be able to play on an other segment than the one of the premium showers Aqualisa has to reduce its margin. To be as realistic as possible I decided to use a margin of 51.33% which is the average margin between all Aqualisa’s products from the standard category. To find the sale price of the Aqualiza Quartz I had to match the MSP with the target margin of 51.33%. Once the MSP has been found, I have assumed that trade-shops will be able to achieve a margin of 46.22% on the Aqualiza Quartz which is above the average to stay attractive for them. AQUALIZA QUARTZ Trade Shops Final Customers/Plumbers £168 X2.05 X1.88 = £649 Final Price
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    25 Profit & LossSpreadsheet Sales Scenario Break Even Pessimistic Realistic Optimistic Volume 157 380 506 632 Price per unit 345 345 345 345 Gross Turnover 54,165 131,100 174,570 217,940 Discounts 0 0 0 0 Net sales Costs of production (26,376) (63,840) (85,008) (106,176) Gross Margin 27,789 67260 89,532 111,764 Salary (18000) (20,250) (26,250) (30,000) Communication & marketing expenses (1,677) (1677) (1,677) (1,677) Travel expenses (1,000) (1000) (1,000) (1000) *Others expenses (7000) (7000) (7000) (7000) Total operating costs (27,677) (29,927) (35,927) (39,677) Operating Income 112 37333 53,605 72,087 Pre-tax income 112 37333 53,605 72,087 Tax (20%) 0 (7,466.6) (10,721) (14,417.4) Net Income 112 29,866.4 42,884 57,669.6 *Others expenses include restaurant, parking, laundry, telephone etc. In one year time a sales representative should reach the realistic net income of £ 42,884 To operate in the black and so cover fix costs he has to sale at least 157 units Summary Expectations are high to force our sales representative to work hard during the whole year to get a beautiful commission at the end. For a reason of simplicity I assume not doing discounts on average. Given the table the average price offered to our client of will be of £345. Quantity Price 0 - 20 £ 379.5 20 - 45 £ 345 45 - 70 £ 310.5
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    26 The Conclusion Sales Plan& Objectives According to turnover forecast realized, the KT area does not have a big potential and so will be cover by a single sales representative. The main objective is to win 15% of market share into the area through an active sales plan and a marketing campaign. To achieve this objective 506 showers have to be sold within the year. Environment & Opportunities The shower market is highly dependent on the housing market which is going well for the moment. Secondly, shower sales depend on the population, currently the population is not only increasing but also aging. Targets & Positioning Given the failure on the premium segment, Aqualisa has to reposition itself to be competitive and attractive. In the first instance trade shops will be targeted because of their importance in the standard segment where Aqulisa Quartz will be sold. Secondly, a particular attention will be paid to plumbers who are playing a big role in the shower selection process. Marketing Communication Three channels of communication will be used to reach our target before getting in touch with them. It will be like an unconscious preparation to a first sales call. One will be destined to reach plumbers, another one will be to approach trade shops, and the last one will be a more global marketing campaign. After the market and sales analysis, my general opinion on the sale of Aqualisa Quartz shower in the KT area, is that this geographical zone is too constraining for the company if we are not considering big trade shops which is the source of the biggest part of the forecasted turnover in the area.
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    27 References Aqualisa (2016) Features& Price Aqualisa Quartz digital shower. Available at: http://www.aqualisa.co.uk/showers (Accessed: 15 march 2016) Bristan (2016) Features & Price Bristan Artisan Digital Electronic. Available at: http://www.bristan.com (Accessed: 15 march 2016) Fame (2016) Aqualisa financial data. Available at: http://www.fame.bvdinfo.com (Accessed: 2 April 2016) Galaxy (2016) Price GRS1 digital shower. Available at: https://www.galaxy-showers.com (Accessed: 15 march 2016) Instantprint (2016) Booklets price. Available at: https://www.instantprint.co.uk/booklets (Accessed: 29 march 2016) Key Note (2015) ‘Bath & Sanitaryware market report’. Available at: http://www.keynote.co.uk (Accessed: 15 march 2016) London DataStore (2015) ‘London Housing Market Report’. Available at: http://data.london.gov.uk/housingmarket (Accessed: 15 march 2016) London DataStore (2014) ‘Population projections’. Available at: http://data.london.gov.uk/demography/population-projections (Accessed: 1 march 2015) Mira (2016) Features & Price Mira Platinum Ceiling digital shower. Available at: http://www.mirashowers.co.uk (Accessed: 15 march 2016) Nick Ellis (2011), ‘Business-to-Business Marketing : relationships, networks and strategies’, Oxford: Oxford University Press O2 (2016) Ipad Air 2 price. Available at: https://www.o2.co.uk/shop/tablets/apple/ipad-air-2 (Accessed: 29 march 2016) Signkick (2016) Billboards rental . Available at: https://www.signkick.co.uk (Accessed: 2 April 2016) Totaljob (2015) Salary sales representative. Available at: http://www.totaljobs.com/salary-checker/average-sales-representative-salary (Accessed: 2 April 2016) Triton (2016) Features & Price Triton Satelite Digital Mixer Shower. Available at: https://www.tritonshowers.co.uk (Accessed: 15 march 2016) Trustatrader(2016) Plumbers in the KT area. Available at: http://www.trustatrader.com (Accessed: 29 march 2016) Vistaprint (2016) Business cards price. Available at: http://www.vistaprint.co.uk (Accessed: 29 march 2016)