Selling machinery to pharmaceuticals companies takes up-front preparation
Ask any sales representative and they'll tell you that getting the prospect to put his signature on a piece of paper is the hardest part of the sales process. But for Michel Lapierre, president of NJM/CLI, a pharmaceutical packaging equipment manufacturer, it's often the easiest.
That's because unlike sales representatives in other industries, those working for NJM/CLI spend a lot of time scouting and working with prospects to make sure there is a good fit, even before a quotation is prepared. So when the time comes, filling out a contract is almost a formality.
Listening to Lapierre talk, you'd think his company --which just had its best quarter ever, -- wasn't affected by the September 11th events. But he is quick to set things straight.
"We are doing well," said Lapierre. "But you have to remember, we have a long sales cycle. The deals we closed late last year, were ones that we had been working on for a long time. We will only know much later if there was any impact from 9-11."
NJM/ CLI is a partnership between Pointe Claire based Charles Lapierre Inc, founded in 1966 by Michel's father, and New Jersey Machine, a U.S.--based labeling equipment manufacturer. The two organizations teamed up five years ago to sell integrated packaging solutions, mostly to pharmaceutical and vitamin manufacturers such as Wyeth-Ayerst, Pfizer Inc. and Patheon Inc.
The arrangement has been a big success. Sales were about $22 million U.S. in 2001, an increase of about 15% from the previous year. Of that about 80 per cent is production is from American clients.
Selling packaging machinery to the pharmaceutical sector is a tough business. Machines must adhere to the highest quality and cleanliness standards so that the pills are not contaminated, or they don't get mixed up in the wrong batch said Mark Laroche, the company's vice-president (sales).
The stakes are high. To use an extreme example, if a packaging machine has rough surfaces, a potentially deadly substance such as a morphine pill could get stuck, and later come loose and get mixed up in a vitamin jar. Someone could get seriously injured or even worse.
"When we initiate contact with clients, we make sure to assess their needs up front as much as possible, including purchase cycles, budgetary restrictions, and so on," said Laroche. "But one of the biggest issues is quality control."
The NJM/CLI machines, which can run from $20,000 up to $1 million for a complete packaging, labeling, filling and capping system, are built to conform to the U.S. government's Food and Drug Administration current good manufacturing practices (CGMP) standards.
That means that all parts that come into contact with the pills must be perfectly clean, and made of non-permeable material. Gaskets must be specially designed so that no oil or residue leakage permeates. Machines cannot have any painted surfaces, because the paint could chip, and get mixed in with the drugs.
Label verification systems also play a big role, because a mix-up in dosage or drug can be fatal. Depending on the application, machines can be equipped with a host of quality control features including UV detectors, cameras and UPS scanners on machines, to ensure that each bottle is correctly labeled.
Clients often fly up from the U.S. to tour the plant to make sure quality and cleanliness standards are adhered to. And one machine technician, showed me his perfectly white gloves said that "you won't find many manufacturing plants this clean."
According to Ron Mondor, president of L'Institut de Ventes de Montreal, who has been training NJM/CLI sales representatives, company reps are being taught to "close up front."
That means immediately realistically assessing whether the prospect can use the product being offered, when he needs it, and whether he can afford to pay for it. Sales resources can then be allocated based on how good a fit there is between NJM/CLI's products and the prospect's needs.
The results have been impressive. In addition to sales growth, administrative costs have been reduced, the number of quotes prepared has been cut in half, and the closing percentage has shot up from 18 to 24 per cent.
"Salesmen tend to put too much emotion into the sales process, they think only of closing the deal as fast as possible," said Mondor. "When they do, they stop listening to their clients, and then they lose sight of the overall picture. If that happens closing the sale is next to impossible."
Photo Caption: According to Michel Lapierre, president of MJM/CLI, (shown here with sales trainer Ron Mondor), selling packaging machinery to the pharmaceuticals industry requires lots of preparation and a long sales cycle.
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