There is a gap somewhere in the sales team: there are more direct buyers, but dealers have stopped placing orders. Imagine a manufacturer of retail equipment. A dealer selected display stands for a new shop and asked the factory for a quote. Then the shop owner found the manufacturer and contacted it directly. A salesperson sent a proposal at a lower price than the dealer’s. The buyer paid, and the dealer cancelled their enquiry. The direct sales team recorded a new customer.
The owner is advised to strengthen this team: it brings in orders while partners are losing buyers.
I would first put both enquiries side by side. If they are for equipment for one shop, before hiring a salesperson we need to answer: did the company gain an additional order, or did the same order change sellers?
A new buyer in the CRM system may have been considering our product for some time
In this situation, the salesperson in the direct sales team is not being dishonest. The person wrote to them for the first time, there was no previous record, and the money reached the factory’s account. Their report really does show a new sale.
But the manufacturer’s work on it began earlier. The dealer helped the buyer choose equipment, checked the dimensions and put the order together. The direct salesperson received an enquiry with some of the work already done. If we compare how quickly they get from the first conversation to payment, this work disappears from the comparison altogether.
This is where I would separate two questions. Who brought the purchase through to payment? And whose actions led the buyer to start choosing our equipment? The answers may point to different people. The first question is needed to review how the work was done. The second is needed to decide where to put our efforts to bring in the next orders.
The fact that someone contacts us directly does not by itself answer the second question. If the owner expands the direct sales team on this basis alone, they risk adding people who will handle demand created by partners more quickly. Whether there will be anyone to create more demand is a separate question.
Two similar enquiries do not yet prove that an order was taken from a dealer
Matching company names are not enough. A chain may be opening different shops, and one buyer may be making several purchases. The head of sales needs to reconstruct the specific purchase: which site it is for, what equipment is included and when the customer needs it. They then need to link the dealer’s request, the direct enquiry and the correspondence before both proposals were sent.
Several conclusions are then possible.
- The buyer arrived with the dealer’s selection already made, and both enquiries relate to one shop and one set of equipment. This is a repeat enquiry about an existing purchase. The head of sales finds out what made the customer change sellers: the price, the work included, the timing or another condition.
- The dealer stopped replying, and the buyer said they were ready to look for equipment from another manufacturer. The direct sales team may have saved the order for the factory. The evidence here is the history of unanswered messages and what the buyer said about their next choice. One complaint from the direct salesperson about a slow partner is not enough.
- The buyer’s name is the same, but the equipment is needed for another site. This is a separate purchase. Passing it to the dealer just because the name matches would be a mistake.
- It was not possible to reconstruct how the choice was made. The head of sales leaves the source of the demand unknown. They record the payment but do not treat it as proof that a new way of attracting customers has succeeded.
Even the first situation does not prove that the dealer would definitely have made the sale without the direct sales team. The buyer might have gone to another manufacturer or decided against the purchase. What has been established is more limited: the factory encountered one purchase in two places. It cannot be called an additional purchase just because there is a second record.
A lower price may hide differences in the work included
Now let us return to the proposal priced below the dealer’s. Before looking at who got in whose way, let us compare exactly what the buyer received for each amount.
The dealer may have included delivery and assembly, while the factory may have offered equipment for collection. In that case, the buyer is comparing orders with different things included. The direct salesperson first needs to explain the difference and find out who will do the remaining work. Otherwise, the argument over price will end after payment, when the customer is expecting an assembly team.
If what is included and the terms are comparable, we still need to compare the money the manufacturer itself receives. When selling through a dealer, the factory receives its own selling price, not the full amount of the dealer’s proposal. In a direct sale, some of the dealer’s work may pass to the factory: selecting equipment, arranging delivery and answering questions about assembly. Someone will have to do it.
A direct purchase may well be more profitable. But that does not mean the team has learnt to bring in new buyers. The owner may deliberately change how the company sells to meet existing demand. In that case, they need to see what work the company is taking on and why they consider this change useful.
Fulfilling an order more profitably once it has been found and finding the next one are different tasks. Each needs its own basis for a decision.
Banning direct sales will leave the buyer between two sellers
Protecting dealers with a complete ban seems like a quick solution. But what should a buyer do if the dealer has not replied? Or if they want to buy without assembly and collect the goods themselves? You cannot automatically send someone back without finding out why they contacted you.
A separate CRM for partners will not solve the problem either. It may hide a purchase the factory is already working on even more effectively from the direct salesperson. At the same time, you cannot merge all of a company’s records into one: different orders and agreements must remain distinguishable.
I would start with a more limited step. Before sending a proposal, the salesperson finds out whether the customer chose the equipment themselves or had already worked with a partner to select the items for this order. If the purchase matches a dealer’s enquiry, the salesperson links the records and passes a specific question to the head of sales: what has changed in the request, and why is a different way of selling needed?
The buyer is told straight away who will come back with an answer and when. The check must not turn into silence while the teams sort things out between themselves.
The head of sales must resolve the issue before the second proposal
One type of equipment where an overlap has already been found is enough to start with. The owner defines which direct sales the company wants to develop, what terms it is prepared to offer for its own sales and what commitments it has made to partners. The head of sales is given boundaries within which they can act independently.
Within these boundaries, the head of sales reviews the overlapping order before a new price is sent. If the dealer is still working on it, the head of sales arranges a next step agreed with the buyer. If the customer has changed what the order includes, the team prepares a proposal to match. If the partner is not replying, the head of sales works out how to continue the purchase while honouring the company’s commitments. They refer any decision beyond their authority to the owner, along with the facts and the time by which the customer expects an answer.
The linked records retain the reason for the decision, the person responsible for the buyer and the outcome of the earlier enquiry. Otherwise, on Friday the direct sales team will once again report a gain, while the employee who works with dealers reports a loss. The owner will be reviewing two stories about one shop.
The head of sales should also look at what the partner does next. After the cancellation, do they continue selecting our equipment for new buyers? Have they said they are ending the relationship? Or have they simply not sent another request yet? These are different facts. One pause is not enough to declare the sales channel lost, but direct payments must not hide from the head of sales what is happening to the source of these purchases.
Return to the same orders next week
At the next review, the head of sales brings the same list of overlaps, with an update on each purchase. They add new enquiries separately. This makes it possible to check the work the team promised to do, instead of switching attention to recent payments.
For each order, it is clear whether the overlap was found before the second proposal or after a complaint; whether the reason for the enquiry was established or guessed; whether the buyer received an answer by the promised deadline or had to wait; and whether the earlier enquiry was closed with a clear outcome or is still left open as a future sale.
If the records were linked but the direct salesperson still sent a new price without waiting for the head of sales to decide, there is now a record, but the action has not changed. If the check means the customer waits longer for an answer, the head of sales identifies the specific approval that held up the order and revises it. The mere existence of a new rule proves nothing.
In a week, you can see whether the team has started noticing overlaps and answering buyers on time. You cannot promise a sustained increase in demand within that period. That requires following new purchases and the partners’ continued work; the source of some orders may remain unknown.
At RENTROP, this daily work is done by the head of sales as part of the “turnkey sales management” service. The business development director checks their decisions: on what basis a direct payment was called new demand, what happened to the dealer’s enquiry and whether the buyer received the promised answer. The choice of channels, prices and commitments to partners remains with the owner. The direct sales team’s report must not quietly make these decisions for them.
An order that a dealer lost and the direct sales team won has not yet become a second order for the manufacturer.