Partner Sales Strategy

1
Partner Sales Strategy
Contents

• Buying behavior
• Target groups
• Acquisition process
• Customer problems and solutions
• Basel II

2
Partner Sales Strategy Unit Objectives
At the conclusion of this unit, you will be able
to

• Describe the buying behavior and buying criteria
  of small and midsize companies
• Define your customer target group
• Describe the acquisition process
• Describe potential problem areas facing small and
  midsize companies and how to solve them using SAP
  Business One
• Describe Basel II and how it effects small and
  midsize businesses

3
Factors Determining Choice of Software
Factors determining choice of software by German
companies
32
Trade journals/other sources
Confidence in hardware/software vendor
24
28
Known solutions
Software consultant
16
0
10
20
30
40
Source SoftTrend study 205
4
Buying Behavior

• 70 of decision makers place quality before
  price. 59 of decision makers would not buy any
  unknown brands.
• Small and midsize business customers expect
  software vendors to offer more than software to
  help them face the problems common to the SMB
  market
• Knowledge of business environment
• Ability to offer guidance
• Solutions
• This is the work of the SAP partner.
• Source SG Cowen Research 2002

5
Sales Opportunities

Sales to SAP customers or subsidiaries and
suppliers
Projects
Sales to industries linked to other applications
Solution sales
Sales to small companies that have not used any
IT software or little software to date
Product sales
6
Project Business and Product Sales
Sales
1. Project business
2. Solution sales
3. Product sales

• Sales from Consulting
• Actual data analysis
• Feasibility study
• Process analysis

Customer has to pay for that!
Customer knows
Customer does not know
Problems!
7
Customer Target Group

• Which customers do you want to targetand how?
• Project business?
• Solution sales?
• Product sales?
• Which industry? (e.g., trade and services)
• Where do we have the most experience?
• Customers interested in other products (HR,
  production, and so on)?
• Lead-generating concept?
• Customer contact concept?

The strategy of the SAP partner determines which
approach is selected.
8
Acquisition Process 1

• Steps
• Define suitable target group
• Compile addresses ( Address publisher)
• Collect information on customer/industries
• Conduct telephone inquiries (name of contact
  person)
• Conduct mailing (SAP Marketing offers templates)
• Phone call to potential customerGive me 30
  minutes and I will show you how helpful and easy
  to handle SAP Business One is and how many
  reports Business One offers for your daily
  business!!

9
Acquisition Process 2

• First contact
• If possible only conduct initial talks with
  managing director or other decision maker
• Request permission to give presentation WITHOUT
  interruptions
• Duration Depending on time allocated by customer
• Content What does he want to see? What do I want
  to show additionally?
• Aim of presentation
• The presentation must make a very good first
  impression on the decision maker.
• You never have a second chance for a first
  impression!
• Finally ask the customer Do you think that
  Business One is of interest for you and your
  company?
• If no, ask him why he thinks so!

10
Acquisition Process 3

• If yes, find out about the processes,
  requirements and requests.
• If possible ask the members of the managing board
  about their wishes, needs and expectations (top
  down approach).
• Prepare further (targeted) presentation for the
  customer (more detailed).
• If necessary make provision for queries/solutions
  or similar.
• Dont forget
• After the second presentation the customer is
  able to decide!
• Ask him!!!

11
Customer Contact
What should you target? Area of interest or aim
of customer?
Aim of customer
Area of interest
Enterprise management
Improvement in reliability Improvement in
efficiency Simplification of processes
Improvement in quality of information
Growth and change
Ability to secure capacities Ability to offer
flexibility Ability to adapt to new situations
quickly
Cost control
Improvement in productivity Reduction in costs
Reduction in purchasing costs
Service for end users
Improvement in service Demonstration of
performance Improved monitoring of customer
situation
Human resources
Reduction in personnel costs Personnel
development Information on performance
12
Management Problems and Solutions
SAP Business One helps through
Problem
CRM tool, learning from gained and lost
opportunities, help with promotions through
contact management
Dwindling market share, increased competition
Gross profit at any time at the touch of a
button, release procedure, competitor and prices
in contact management
Decline of profit margin
Drill down and DragRelate function
Poor control because of missing data
Last prices of vendor, alternative vendor
Rise in costs for sold products
Quick overview of stock levels alert if minimum
quantity shortfall occurs opportunity pipeline
(CRM tool)
Not possible to meet customer requirements
Gross profit in every phase of sales negotiation,
calculation helps (last prices), release
procedure (discounts)
Diminishing manufacturing profit
Opportunity analysis (CRM tool) to determine and
evaluate why objectives were not reached
Objectives not reached
Multiple currencies, multiple languages
Internationalization
13
Problems and Solutions in Accounting
SAP Business One helps through
Problem
Multiple reporting, DragRelate, simple writing
of queries, formatted search
Lack of accurate reporting
Multiple reporting, DragRelate, simple writing
of queries, formatted search, dunning system

Diminishing liquidity
Multiple reporting, DragRelate, simple writing
of queries, formatted search, opportunity
pipeline and analysis
Bank talks missing documents or reports
14
Problems and Solutions in Warehouse and
Production
SAP Business One helps through
Problem
Physical inventory support, release procedure,
alerts
Too much stock in warehouse
Determination of minimum stock level and alert
Alternative Items
Too little stock in warehouse caused production
stop because components missing
Allocation of route already possible whenplacing
order Alert function as a reminder/alternative
items, pick and pack
Delivery problems
Reminder functions
Dates not met
Create purchase order from sales order
Purchase failure
15
Problems and Solutions in Sales
SAP Business One helps through
Problem
Opportunity pipeline, analysis, and contact
management (CRM tools)
Forecasting
Numerous reporting options (queries) for
customers analysis analysis (CRM tool)
Evaluation and analysis of customers
Numerous reporting options (queries) for sales
analysis (CRM tool)
Evaluation of performance of salesperson
Easy to complete forms, access to existing data,
last prices, gross profit, adaptable forms
Scheduling and processing quotation,delivery and
invoice
Gross profit pushbutton, last prices, definition
of discount margin
Price policy
16
Arguments and Headlines from SAP Marketing

• SAP has 18,000 customers throughout the world,
  half of which are SMBs.
• SAP is the leading provider to small and midsize
  businesses andknows the problems.
• SAP has worked successfully in this area for
  approx. 30 years.
• SAP supplies the entire SMB market with
  individual solutions and is the solution provider
  to small and midsize businesses in all industries
  and for all sizes of company.
• SAP provides solutions to every problem, whatever
  the size of the company.
• SAP works only with highly qualified and
  certified partners.
• SAP helps you to grow.
• The decision for SAP Business One is a safe
  decision.

17
Basel II What is it?

• Basel I
• Supervisory rules for banks (developed by the
  Basel Committee on Banking Supervision, Basel,
  Switzerland)
• Basel I is used in over 100 countries.
• If banks grant credit to companies, the companies
  must deposit 8 of the credit volume in the form
  of equity capital.
• The collateral and creditworthiness of customers
  play a secondary role.
• Basel II
• The aim is to obtain information about how secure
  and reliable thefinancing of small and midsize
  businesses is in the future.
• Consequences of Basel II
• Selection criteria is tighter to minimize the
  risk to the bank.
• Lending has been made more restrictive through a
  stronger evaluation of creditworthiness and
  collateral.
• Conditions have been relaxed for companies with
  good creditworthiness, and tightened if the
  oppositeis true.
• Bank risk surcharges are to be placed on credits
  for companies with low creditworthiness (could be
  3).
• A rating scheme for customers and companies was
  introduced.

18
Rating under Basel II

• Bank customers are assessed for creditworthiness
  and legal standing.
• Criteria
• Country risk
• General legal conditions (national/international)
  
• Analysis of the country of origin of the credit
  customer
• Industry risk
• Competition trends
• Industry analysis
• Company risks
• Market position
• Qualitative analysis
• Management and personnel resources
• Business strategy
• Financial flexibility
• Quantitative analysis
• Annual reports
• Financial budget/financial analysis

19
Impact on Small and Midsize Businesses

• The rating goes from 1 8
• 1 4 Credit without problems and without
  "risk surcharge" (can differ)
• 5 6 Credit plus "risk surcharge"
• 7 8 Credit limit may be reduced or
  terminated
• Activities aimed at improving the rating
• Check your accounting policy (check accounts not
  only from a tax point of view).
• Use all available financial instruments (outside
  and equity financing).
• Exploit opportunities (do away with out-of-date
  models, unprofitable customers and over-complex
  cost structures).
• Shake up your information policy (disclose
  economic ratios and the results and company
  developments).
• Initiate improvements to systems and processes
  (introduce integrated business application
  software such as risk management, management
  information, Accounting and Controlling,
  Personal, CRM, value chain, retailing and
  stockholding).
• That is the approach for selling SAP Business
  One.
• Source Basel II and SMB, 2002, SAP and National
  Bank, Essen

20
Group Work
Which features and functions of SAP Business One
are essential for inclusion the first time we
give a presentation at the customer? Priority
1 Priority 2 Priority 3 Time allowed
Display results on board after 30 minutes.
21
Exercise 1 Preparation for a Presentation
A Z Office Supplies is interested in acquiring
new software for enterprise management. Scope of
supply Office supplies / office furniture / PCs,
printers and accessories / computer accessories
The company has no retail outlet, however, it
has a showroom for consulting. Deliveries are
made from two warehouses to keep delivery costs
to a minimum. The company covers a radius of
approximately 150 km from each warehouse.
Deliveries are made on different routes with
proprietary delivery vehicles. A-Z Office
Supplies has 33 employees of which 20 are users.
Warehouse1 5 persons (2 drivers, 1 secretary,
2 warehouse workers) Warehouse2 5 persons
Sales office 7 persons (6 salespersons 1
head of department) Showroom 4 consultants
Accounting 2 persons Human resources 1
person working half-days Marketing/advertising 2
persons Management 3 persons (manager,
assistant, secretary) Temporary personnel 4
persons Existing hardware Compaq,
Hewlett-Packard and Lexmark Existing software
Microsoft Windows XP, Word, Excel, Sage Line 50
(preparation of monthly and annual financial
statements for tax adviser) The manager, Mr.
Runge, wants to expand his business activities in
the near future, and is looking not only for a
solution with growth potential but also for more
options within CRM and company reporting. Mr.
Runge has contacted you and arranged an initial
presentation to be able to see how the product
works in operation. He has about an hour at his
disposal for a presentation and discussion. Your
task Work out the best presentation for this
situation and prepare yourselffor the
preparation.
22
Partner Sales Strategy Unit Summary
You are now able to

• Describe the buying behavior and buying criteria
  of small and midsize companies
• Define your customer target group
• Describe the acquisition process
• Describe potential problem areas facing small and
  midsize companies and how to solve them using SAP
  Business One
• Describe Basel II and how it effects small and
  midsize businesses