Increase Profits by Managing Sample Opportunities

In our Increase Profits with Batch Manufacturing Software blog, we quickly overviewed the top four things you can do with the help of batch manufacturing software, such as Vicinity, to ensure your organization is getting the most out of the operations in your existing business, without changing much of what you are doing today. So far we have covered reviewing formula loss, inventory shrinkage and material costs to increase profits. The fourth thing you can do to increase profits is to follow up on sample opportunities.

You will find that the sampling process is much more complicated than filling a typical order.

Most formula manufacturers provide samples to new or existing customers. However, very few actually have a mechanism to track these samples and follow up on the results. While samples may seem to be a minor issue in your organization, you will find that the process from taking the sample request to fulfilling the order is much more complicated than just filling a typical order. Since most systems are built around shipping an order size, not a sample size, it is a common issue for a formula manufacturer to not have the ability to address the small quantities and unique handling requirements for that sample.

What steps can you take to manage sample opportunities?

  1. Identify the closure rate of samples
      • Review 3 months of samples sent 6 months ago.
      • Review how many have actually resulted in sales.
      • See what manual steps your employees are taking to address this sample request.

2. Target formula/product types that have resulted in higher sales closure rates.

    • Identify what makes these products different than other products.
      1. Is it the type of customer?
      2. Is it the salesperson for that product type?
      3. Is it the type of product itself?

3. Work with Sales and R&D departments

    • Develop a plan to track and follow up on samples sent to new or existing customers.

You can perform these steps using an automated tool, such as Vicinity Software, or manually with your existing system. The overall goal is to find out how you are currently following up on sample opportunities and tracking the sales that those opportunities result in, and optimize your future sample opportunities for future sales. This knowledge will go a long way to provide corrective action that will increase profits without making significant changes to your production process.