Question and Answer

By Dave Kahle

Q.  You’ve said on several occasions that the most important part of my job is interacting with the customers.  How important is it to spend time with the customers out of the office, and what percentage of time should I spend doing it?

            A.  So many of these answers begin with the phrase “it depends.”  This is another one of them.  The amount of time and money you spend entertaining customers, or spending time with them outside of the office, depends on the value of the account.  The larger the annual dollar potential, the more time you should seek to spend with the customer on a personal level.

            For example, if you sell water softeners to homeowners at $1,000 each, you probably should not ever invest in entertaining.  On the other hand, if you sell those same water softeners to retailers, and one particular retailer could buy 2,000 of them in the course of the year, you should seek to deepen the relationship with that customer.

So, the answer begins with you analyzing the dollar potential of each of your accounts, and then making the determination as to which accounts, if any, are worth your extra investment of time and money.  After you’ve compiled a “hit list” of people with whom you’d like to spend some additional time, create an annual budget.  This can vary from a couple hundred dollars for lunches over the course of a year, to something entirely different.  I recall a friend of mine who was a manufacturer’s rep in the automotive industry, with General Motors as his only account.  In the by-gone-days of lavish entertainment, he had an annual entertainment budget of $80,000. 

            After you have compiled your “hit list” and developed a budget, you then need to determine what that customer could do.  Some accounts have policies against having lunch with vendors, for example.  Others don’t.  Don’t create an awkward situation by inviting your customer to do something that the company’s policy discourages.

            Ideally, I’d like to see you have breakfast or lunch every day with a customer.  That’s a good use of time for both of you.  Try to schedule events – concerts or sporting events are always good, and invite your hit list.  Be careful about outright gifts.  You don’t want to be seen as “bribing” anyone.  Instead, orchestrate time together so that you nurture and expand the relationship.

            Hope this helps.