Valley Winery
Situation
Valley Winery has recently hired Pat Waller as sales manager of their San Francisco region chain division. There have been favorable sales increases during the past several years; however their sales force turnover is extremely high reaching nearly 100% a year. Pat Waller will be supervising two area managers who oversee nine district mangers with approximately fifty sales reps in the San Francisco region. The eighty year old company is the largest domestic producer of wine in the USA, with sales believed to have exceeded $1.8 billion in 2012. Two broad factors are traced to the company’s growth and success:
• Produces high quality at a low price
• Sales force uses a push strategy considered to be the most aggressive in the industry
The San Francisco division is broken down into three sales groups with each having a different compensation structure. Pat Waller’s chain store division uses a major account system that requires field reps to call into HQ’s of large chain stores. These reps have a straight salary ranging from $47k to $54k, plus a company provided car and a year-end bonus.
Key Problems
Improper recruiting and hiring process
Mike Wehner the personnel manager is responsible for recruiting the sales candidates. Recent college graduates, employment agencies, newspaper ads and job boards, and employee referrals are the methods used to attract candidates. No candidates are recruited from competitors or customers. These methods have resulted in high recruiting and training costs along with a less experienced sales force. The candidates then go through three interviews with neither of the interviews being with a potential direct supervisor. The first interview is with Mike Wehner who is also responsible for hiring all personnel for the division (warehouse workers, truck drivers, office workers, and sales force). A second interview is then conducted by the distributorship’s top manager for less than ten-minutes. The candidate’s youth and
Valley Winery has recently hired Pat Waller as sales manager of their San Francisco region chain division. There have been favorable sales increases during the past several years; however their sales force turnover is extremely high reaching nearly 100% a year. Pat Waller will be supervising two area managers who oversee nine district mangers with approximately fifty sales reps in the San Francisco region. The eighty year old company is the largest domestic producer of wine in the USA, with sales believed to have exceeded $1.8 billion in 2012. Two broad factors are traced to the company’s growth and success:
• Produces high quality at a low price
• Sales force uses a push strategy considered to be the most aggressive in the industry
The San Francisco division is broken down into three sales groups with each having a different compensation structure. Pat Waller’s chain store division uses a major account system that requires field reps to call into HQ’s of large chain stores. These reps have a straight salary ranging from $47k to $54k, plus a company provided car and a year-end bonus.
Key Problems
Improper recruiting and hiring process
Mike Wehner the personnel manager is responsible for recruiting the sales candidates. Recent college graduates, employment agencies, newspaper ads and job boards, and employee referrals are the methods used to attract candidates. No candidates are recruited from competitors or customers. These methods have resulted in high recruiting and training costs along with a less experienced sales force. The candidates then go through three interviews with neither of the interviews being with a potential direct supervisor. The first interview is with Mike Wehner who is also responsible for hiring all personnel for the division (warehouse workers, truck drivers, office workers, and sales force). A second interview is then conducted by the distributorship’s top manager for less than ten-minutes. The candidate’s youth and