Cabinet Makers Find Dedicated Sales Team Delivers Growth

By Dave Grulke | Posted: 01/29/2013 6:00PM

 

  Dave Grulke Cabinet Makers Assocation custom woodworkDave Grulke The 2013 Cabinet Maker Association Benchmarking Survey found sales growth corresponds to having a dedicated individual or team, and a marketing plan. The correlation is dramatic.

Most cabinet  shops (76.6%) have no dedicated marketing budget, instead relying on referrals from customers and business associates such as contractors and designers as their top source of qualified leads, mentioned by 95.3 percent of respondents.

The next most-mentioned source of leads -- a distant second -- was “My Website” , mentioned by 47.7 percent of shop owners. These data are consistent with last year’s findings. In addition, only one in four respondents reports having a full or part-time resource dedicated to sales.

Sales Resources Correlate to Higher Sales

Only one in four respondents (24.9%) reported having a full or part-time resource dedicated to sales, with 15.7 percent employing a full-time person (or persons); and the balance split between part-time sales staff (4.5%) and independent sales reps (4.7%).

Perhaps not surprisingly, the bigger shops tend to employ dedicated sales staffs, with those reporting revenues of between $2.5 million to $4 million being the sweet spot for dedicated staff (accounting for 22.9% of full-time staff reported), while those with revenues below $1 million tending to use part-timers or outside reps.

As one might expect, there appears to be a correlation between those shops with dedicated sales resources and business growth. But the impact charted in the survey is striking. While the general survey found that just over half (54.7%) of all respondents claimed higher sales in 2012, crosstab analysis reveals that 70 percent of those with full or part-time sales resources saw growth last year, and their share of growth appears larger.

In fact, in the general survey those reporting growth of over 20 percent accounted for 22.5 percent of the respondents; while those with dedicated sales resources claiming 20-plus percent growth accounted for 36.7% of respondents.

Not surprisingly, these same companies are the most bullish on 2013, with 77.1 percent feeling more optimistic compared to 67.4 percent among those without dedicated sales resources. Perhaps the reason for their optimism is greater visibility into their sales pipelines, mentioned by 57.4 of those with sales resources (compared to 49.9% by those without).

Companies with sales staffs are twice as likely (42.9% vs. 22.7%) to use network marketing through groups and associations as their primary tactic for generating business than their colleagues – probably due to the time constraints of running the business.

When asked to select the top three sources of new business inquiries, those with sales teams mentioned referrals (90%), my sales force (68.6%), and my website (50%) as their top performers. Among those without sales resources, referrals were even more important (97.9%), followed by my website (46.1%) and traditional marketing programs (16.5%).

Those with sales resources are nearly four times more likely than their counterparts to have a dedicated budget for marketing and business development, with over half (55.7%) of those with sales teams reporting budgeting funds for marketing vs. 13.5 percent of those without sales help.

Among sales-oriented shops that budget for marketing, most set aside 1-3% of gross revenue (24.3% of respondents in this group, compared with 9.9% of the survey average) to spend on marketing.

The Cabinet Makers Association released the executive summary of our 2013 Benchmark Study. The full report will be available in early February, and you are welcome to request a copy of the report after it is released. To get your copy, e-mail the CMA office at director@cabinetmakers.org and put 2013 Benchmark Study Report in the subject line of your e-mail. 

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About the Survey

Completed surveys were received from 567 qualified woodworking professionals representing a cross section of business sizes, a significant increase over the 112 respondents in last year’s survey. The increase in responses can be attributed to greater awareness of the study and promotion of it via media partners. CMA members represented 12.5 percent of survey respondents.

About the CMA

The Cabinet Makers Association (www.cabinetmakers.org) is a professional organization for cabinetmakers and woodworkers from both the residential and commercial markets. CMA’s mission is to help members grow their businesses profitably by providing networking and professional education opportunities.


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About the Author

Dave Grulke

Dave Grulke is executive Director of the Cabinet Makers Association, formed by cabinet shop owners to provide a national voice and presence for the small cabinet shop.

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