article | September 6, 2012
No Product Differentiation? No Problem. A CEO Who Found Another Way to Grow
If you feel product differentiation and hot markets are the only way to grow revenue, this CEO proved otherwise by refusing to accept these limitations.
Steve Grimshaw is the CEO of Caliber Collision Centers, based in Dallas, Texas. In 2009, Steve was brought in by its ownership group, Oncap. Steve and SBI began working together when he was an Executive Vice President for Safety-Kleen, running a $600M division.
Founded in 1997, Caliber owns and operates over 110 collision repair centers in California, Texas, Nevada, Arizona, and Oklahoma. Caliber is one of the largest multi-shop operators (MSOs) in the country.
Steve describes the situation when he arrived: “The state of business was flat with same store sales declining and acquisitions keeping the operating line flat. Our margin increases were coming from cost cuts and vendor renegotiations rather than increased sales.”
The collision repair’s “market” depends on wrecked cars. On average, drivers get in an accident once every 7 years. Caliber can’t increase accidents. Product differentiation is not known by the customer. Building loyalty at the individual driver level is important, but not a means to double revenue in a 5 year span. You can’t go out and “sell more business” to cure declining revenue growth. Steve realized he would have to do something differently: He would have to win big deals.
He focused on three key steps to make it happen:
1. Know What the Customer Wants
Caliber’s growth depended on retaining and penetrating top clients while converting relationships with key accounts. Steve and his team created a top 10 list of deals Caliber had to win. “The majority of our volume comes from direct repair programs (DRP) that requires you be on the insurance company’s preferred list. This represented the largest opportunity among top 10 carriers.” A strategic partnership with one of the top 10 represents millions in revenue.
Steve started by putting the big deals in the middle of the table. He conducted buyer research and asked his customers what their requirements would be. Here’s what he learned.
“These growth levers represented a larger opportunity and better return for us.” When defining a key target account list for your company, you have to know what the customer wants. Steve didn’t create his strategy in a vacuum. He focused outward-in to build his strategic plan.
2. Build the Roadmap
There was a missing piece to the puzzle: Steve didn’t have dedicated strategic resources. He had local relationships, but the executive teams inside his top 10 were being ignored. ”We were reactive and not focused on understanding and exceeding customer expectations.” He needed a way to tie it all together quickly. “We partnered with a consulting firm to help us identify the right sales resources, define the sales processes, and determine the proper metrics and sales incentives.”
Steve deployed a Key Account Management program that allowed Caliber to focus on big deal conversions. “We built a Key Account Sales organization that focused on customer retention first, penetration second and customer conversions third.”
Steve had a number of avenues he could have chosen. He simplified his route to success by filling a critical role needed to drive big deal success. “The goal was to identify where the opportunities existed to forge trusted advisor relationships, while understanding what resources needed to be added to influence customers’ decisions.”
3. Execute the Plan
Steve knew he couldn’t impact the revenue number by focusing on product improvement or consumer marketing. What counted for Steve were his customers and his team. “We hired sales resources with the right skills and experience. We provided them with the tools, training and support required to be effective.”
By understanding what his customers wanted, Steve was able to hire talent to execute his plan. He sums up his success when he says “We identified the right sales resources, defined the sales processes, and determined the proper metrics and sales incentives to deliver the number.”
Steve recognized his plan would succeed by growing his key accounts. He developed his strategy in year 1 and has exceeded his growth goals. “To double our core business every 5 years requires a 15% CAGR (Compounded Annual Growth Rate). We have exceeded that target the last two years and half of that growth is from same store sales.”
In a market with low growth rates and little known product differentiation, Steve is focused on customer engagement to win big deals for Caliber. He couldn’t achieve his growth objectives without chasing down big deals. He focused on three core initiatives:
It’s easy to get distracted by other priorities. If you are wondering if Key Account Management can help your company grow, ask yourself these 3 questions:
In smaller organizations, selling big deals is critical to success. If you lose the big deal next year, you won’t make the number. Steve Grimshaw recognized the need for Key Account Management and exceeded an aggressive growth number in a declining market.
To learn more about winning big deals using a Key Account Management Program, download our Key Account Management case study.
Sales Kickoffs are right around the corner. It’s the culmination of months of strategic planni...
As budgeting season is in full swing, lofty ambitions for next year’s growth meet the stress o...
Now that you’ve defined and kicked off your strategy for the year, it’s time to take a l...
It’s that time of year, crunch time for the revenue operations team. I am sure you have ...
When a CEO steps into a turnaround situation, investors and board members are anxious for change. Em...
It’s 1:00pm. You have scheduled a meeting to review your annual objective of driving greater s...
The full impact of CoVid-19 is not yet known, but in some markets and regions, it may already be cle...
Over the last week, we have seen the effects of the COVID-19 pandemic on the market, businesses, and...
SBI TV episodes bring you Sales and Marketing insights from B2B industry thought leaders and growth experts, on topics like product, pricing, customer experience and success, and go to market. Catch up on new and previous episodes here.