Key Accounts

"Maximizing Revenue From Large Strategic Accounts"

I dentifying key accounts is important to most sales organizations. However, many organizations fail to use a strategic process to identify them. There is a misconception that a big company should automatically fall into this category. Including big companies in your customer portfolio is usually a good idea, unless they don't match your ideal customer criteria. Bigger accounts generally have a higher cost of doing business, and they are more demanding in terms of their services required. Selling to and supporting big accounts has several challenges.

• Big accounts demand more attention, but they typically do not want to pay a premium for it.
• They leverage their scale and power in the marketplace to negotiate lower prices, better terms, and better support.
• They often exploit suppliers to create competitive price wars for their own benefit.
• They squeeze smaller suppliers to get lower prices, which they used against larger suppliers.

Many large companies do not provide you with the business that is deserved based on the efforts you put into them. Because of that, it is important to identify why you identify a customer as a key account, and what special treatment and attention they will get from your company as a result of that label.

Key accounts can be:

• Big companies with the potential to do a large amount of business with you
• High margin, and high profit accounts that return more to your bottom line than other accounts that require the same attention
• Strategic to your company's goals and business direction
• Important anchor accounts in the marketplace or industry which you can leverage to gain access to other companies
• Provide positive visibility for your company
• Learning and educational customers that help your business progress

As with most companies, you'll find that 80% of the value of your company gets in the marketplace, comes from 20% of your accounts. Finding that 20% is your objective.

Once identified, your company needs to decide what that means in terms of how you interact differently with those accounts than all the other. There can be many factors that may be considered as benefits that you might provide to these special accounts. Those may include:

• Increased discounts
• More account sales reps and overall coverage
• Better service, support, and response time
• Tighter relationships between executives
• Joint business development and product direction
• Cooperative marketing
• Better integration of buying and shipping infrastructure
• Special training, implementation, and deployment
• More open disclosure of mutual business issues and directions between companies

Conclusion

Key accounts can be an important part of any sales organization. Take time to identify what attributes you expect, and what the special treatment you are willing to provide to them. Watch your cost of sales, your return on investment of resources, and set metrics that will enable you to monitor the growth you expect.

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• Account Management
• Account Management Software
• Key Account Manager
• Segment Accounts
• Global Account

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