Selling Fine Chemicals' F . C . RENNER Monsanto Chemical Company, S t . Louis, Missouri
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ELLING chemicals in the postwar world isn't golng to be a snap. Merely being able t o prouounce with confidence and clear diction long-named chemicals, being a good fellow, and writing orders will be out of date. The last few years prove this. The increased complexity of problems facing industrial and sales management, the approach of a period filled with severe competition, and expanding social controls are clear signals to business men of some of the obstacles they will meet in the postwar world. In the chemical industry, manufacturers and salesmen of fine and heavy chemicals are faced with the grim necessity of applying all the new tools of management and then going and making up some more. This is absolutely essential in order to give employment to over ten million returning service men and women who we presume left some civilian employment. Then, add to that the necessity for taking up the slack of inevitable unemployment during the transition from war orders to peace needs. Volumes are being written on postwar planning. All authors have one thing in common-namely, emphasis on full employment. Too frequently they display the misconception that jobs are the result, not the cause of production. The goal of more and better jobs, therefore, must be achieved by planning reasonable methods of assuring an adequate reward for effort to all factors of production and distribution. During the last five years the production star has been in the ascendant. It is also apparent that scientific chemical distribution has lagged considerably behind production efficiency. As we go into the postwar era the distribution pattern will undergo a metamorphosis. The selling star must rise! I t is essential that distribution, which in effect means sales, keep pace with production, for if i t does not, the consequences will be very grave. There are three periods that must be closely related to distribution: I. The Reconversion Period. This period immediately following cessation of hostilities will prove a period during which chemical companies will lay the ground work for competitive success. 2. The Boom Period. Many surveys have led to a compilation of goods the American public will buy after the war. Fortune magazine has made a recent survey of the so-called "splurge" possibilities, in which the following figures are given, based on a survey of what
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1 Presented before the Division of Chemical Education of the American Chemical Society, 107th meeting, Cleveland. Ohio. Aoril 3. 1944.
people say they wish t o buy first, compared with the actual amount spent on these items in 19412:
House
car Refrigerator Air~lane ~ o i f
Wsshine machine Air conditioninz Fur coat Clothen-Men women Radio Phonograph and Radio stove
.
.
t w o splurge items, and clothes usually did not qurlify. The figurer included only to demonstrate therelative popularity of all theitems.
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Because of accumulated demand for innumerable items, it seems fairly certain from such figures, assuming a sympathetic Government attitude, that following reconversion from wartime operations we will have a lush period. It seems certain that during this period, company will compete with company to achieve a strategic marketing position. 3. A Self-sustaining Economy. During this phase, backed-up demand will have been met. It is then that industry will face severe competition and it will be a fight for all industry, including the chemicals industry, to justify its existence. It is in this period, when American industry will stand or fall on the success with which it has developed its distribution efficiency in the first two periods. In viewing the chemical market as a whole, it divides logically into three basic groups, namely, Domestic Consumer Market, Domestic Industrial Markets, and Foreign Markets. Let us take the first one-Domestic Consumer Market: Fine bulk chemical manufacturers by and large have not developed finished products for individuals or families. I t is interesting to note, however, that a goodly number of producers of finished products have begun the production of intermediates. It is very important for chemical sales people to watch this trend, as developments in this direction will undoubtedly have a tremendous effect on the nature of the chemical market. "Pwtwar splurge index," Forlunc, m i i i , 20 (1943).
The second-Domestic Industrial Markets: In the past, approximately 80 per cent of the chemical output was sold to other chemical manufacturers. This percentage is changing; its extent is not now known, and will remain obscure until full chemical statistics are again published. The fine chemicals salesman of tomorrow will be more and more affected by this change. The third-Foreign Markets: The war has forceably brought to attention vast foreign opportunities. These must be carefully studied to see how our domestic chemical developments can fit in with foreign operations to the best advantage; to see how increased production brought about under war conditions will enable the industry to reach out for this foreign business in an endeavor to effect the lowest over-all manufacturing cost. As all of us realize, the growth of the synthetic organicchcmic~1 industry has been tremendous. In 1914, seven firms in the United States munuhctnrinv " coal-tar products employed 528 people; the volume of business totaled approximately $3,500,000. By 1930 this increased to 130 firms with 11,390 employees, and with sales approximating $66,000,000. This in 1939 jumped to 306 firms manufacturing aliphatic and aromatic synthetics, with sales totaling $384,343,000. The value of synthetic chemicals, especially fine chemicals, has greatly expanded since 1939. One needs but to consider the sulfa drugs as an example: In 1939 the only sulfa drug sold was sulfanilamide, and this in somewhat limited volume. Since then a number of sulfa drugs have been developed, and new ones are still appearing. The total poundage moved in 1943 approximated 10,000,000 pounds, with the prices ranging all the way from 90 cents per pound for sulfanilamide, to $11.50 per pound for sulfamerazene and sulfadiazene. Another spectacular development lies in the field of vitamin production, the total dollar "over-thecounter" sales having been estimated in terms of $200,000,000 annually. Chemical technology has converted the rubber industry overnight into a branch of the chemical industry with an output valued a t 400 million dollars yearly. Another 400 million dollars per annum has been added by the chemical manufacturers of aluminum and magnesium. Many other examples could be cited. Practically all of these developments are war developments. Little or no "selling" is required now to move the tonnages produced, hut what about the future? To me this is a challenge. To merchandise the increased output of chemical plants will require all the ingenuity and resourcefulness of the chemical salesman, backed up by various departments with which the chemical salesman has of late become closely allied. Sales plans must be carefully laid out, salesmen carefully selected; they must be well trained and consistently supervised. While no general plan of selling chemicals which is adequate for each and every company can be formu-
lated, the basic principles involved do apply to all when it comes to the question of selecting and training salesmen. I think it can accurately be stated that previous to the last war chemical salesmen were nothing more than "drummers." The chemical salesman's main object was somehow to obtain for his company as much of the existing chemical business as possible. Over the years the status of a good chemical salesman has reached a much higher plane. He is no longer the jovial hand-shaking story teller, a "personality boy." While a good chemical salesman must be a friendly type, he must also possess qualities of representation which are worthy of fuller consideration. A good salesman must have: 1. Adequate knowledge of his products and their relative position with com~etitors. 2. Aptitude for selling. 3. An ethical character.
The chemical salesman of tomorrow must refrain from any psychological hoodwinking. He should not resort to skilful evasion of reasonable questions. He must not indulge in the giving of misinformation hecause of his inability to give the right answer, or because of fear of loss of an order or a contract. He must be able and willing, when necessary, to say "I don't know." It can be summed up by saying that a good salesman is not an order taker. On the contrary he must inspire confidence in the buyer. He must be able to talk to research and production men to the end that he stimulates consumption, and be looked upon as a business adviser. When giving consideration to staffing a sales department with good salesmen, careful thought should be given to the reasons for failures. I t is believed that the great majority of salesmen will fail for lack of: I . Health and oitality: If he is inclined to frequent illness, or is just plain downright lazy, the salesman can never achieve sales success. 2. Inadequate mental equiMent: The salesman should be alert and have good mental reasoning powers. He does not in every case need to have a degree of technical training. A varied degree of technical background is required, depending on the nature of the products sold and the type of buyer to be solicited. Selling vanillin and coumarin to extract makers, bakers, and chocolate manufacturers does not require the same high degree of technical training as is necessary in the sale of orthoanisidine, benzyl chloride, thiourea, or pentachlorphenol to the dyestuff trade, the drug trade, or the tanning industry, respectively. 3. Aptitude: Many lacking aptitude for selling firmly and sincerely believe they can sell. Somehow they have dreamed up a fancy notion of what constitutes selling. Some men have no knack for easily meeting a buyer, knowing how to introduce the subject of his call, sensing when an interview should be terminated. Many are easily discouraged when business is not quickly forthcoming. Too frequently because of inaptitude impolitic subjects are broached. Fre-
quently the salesman "stopped in as he was passing by." Nothing could be less flattering to a buyer. Without aptitude for selling, it is difficult to visualize how a would-be salesman can make the grade. 4 . Vocational disinterest i n the products they ere selling: I well recall several fine chemical salesmen of the old school. These men had developed an excellent reputation in their respective territories, but as their company grew and expanded they continued to stress only those chemicals they were equipped to handle. New chemicals of great promise did not excite their imagination. Even though they were good salesmen of the products they were principally interested in they accomplished little or nothing on other products because of their vocational disinterest. 5. Improper training: Frequently in order to obtain volume quickly some salesmen are sent out into the territory with a price book and urged to get sales. When orders fail to materialize, the salesman is promptly placed in the category of a "poor salesman" and failures result in most cases. Occasionally, however, men train themselves by taking the "bumps," but this is most unsatisfactory and results in an appreciable increase in selling expenses. 6. Inadequate supervision: Lack of direction, which is paramount in effective selling effort, can easily lead the salesman to discouragement. He may even become "unsold" on his company. A salesman must be led, his sales reports checked, calls made with him in the field so that a t all times he is conscious of friendly attention. He should be fnlly posted on changing conditions which may affect his company's position. All too frequently his sales reports are hastily skimmed and tossed aside, whereas, if checked they frequently would be most illuminating. It must be said then that the chemical salesman must be armed with a good grasp of the broad problems of business management, including finance, credit, purchasing, and sales merchandising. He must be alert to the opportunities of making up special products for specific uses, through technical background, education, and training by his employer. The chemical salesman should be alert to new chemical opportunities on products not heretofore manufactured by his company. He must have a larger degree of executive capacity than previously required of salesmen. While he should have customer viewpoint he must likewise possess management viewpoint. It might be interesting to you to know how my company, as a typical large chemical company, is geared to handle the sale of chemicals in what we believe to be an effective manner. With many products reaching into virtually every imaginable industry, we have grouped products on a functional basis, each group being headed by a department manager. The flow of authority starting with the General Manager of Sales is through an Assistant General Manager of Sales to the department heads, and then through branch office managers. The department managers are individuals who have been schooled
in their particular spheres of activity. Under normal conditions each department manager has an assistant. The department manager supervises all of the problems arising in his department, freeing himself of details so as to permit his visiting major accounts, not only in the area contiguous to his headquafters but throughout the country. The assistants are responsible for a good many of the details involved in scheduling production, outlining the type of packages required in a given month, handling the routine of order entering, acknowledgments, etc. In addition to this, the assistant is assigned sales contact responsibilities in the so-called headquarter territory. This enables the assistant to get a comprehensive picture of the over-all department activities, and a t the same time permits h i to exercise and develop his sales talents. From the time a college graduate is hued two to four years may be consumed before he is ready to actually go into a territory. It is the Department Manager's responsibility to see that all functions are carried out and that his assistant is properly coached and advised, with the view that eventually he could take over the department or be transferred to a more important sales' post in another direction. In so far as the branch offices are concerned, ob; viouslv the necessarv staff is determined bv the Dotential volume of business the given territory offers. In our case, salesmen working out of branch officesdo not confine their efforts to any specific group of products, but generally handle the entire line. As the total dollar volume of sales increases, as new products are added to the list, i t will undoubtedly become necessary to revise our sales approach. Methods will have to be found to speed up the introduction of new products and new uses for established products to cut the 7-to-10-year period from test tube to consumer. This may involve a revision in geographical boundaries. I t might well entail the use of commodity specialists or industry specialists. All three approaches have advantages and disadvantages which must be thoroughly studied in order to use the most effective method for the best and quickest results. Sales activities are backed up by various departments, such as Development Department, Sales Development Department, Research, and Advertising Departments. The Development Department, consisting of individuals expert in various lines, is responsible for market surveys, guiding product application, offering technical assistance to customers, handling quality complaints, supervising product specifications, and maintaining customer research contact, as well as broad general contacts with the industry as a whole through associations, etc. When the Development Department has surveyed a new research product, not hitherto manufactured, and recommends its exploration, the details they have developed are turned over to the Sales Development group. This department pursues commercial applica-
tions, resorting to further research when necessary. After they have established product formulation for various uses, it is their responsibility to write a complete Application Data bulletin. The product, with full and complete details, is then turned over to tlie salesman for full-scale selling. The Advertising Department backs up sales activities through institutional advertising as well as product advertising. Its copy is reviewed with sales heads so as to select the product to be pushed, to get suggestions as to proper media, and to make certain the copy is technically correct and in no way objectionable to any of the company's customers regardless of their spheres of activity. Advertising can be a tremendous sales help, and i t seems definitely worth while to study carefully why, what, and where such assistance should be maintained on a proper balance between cost and results. As you can well appreciate, selling fine chemicals is
a rather broad subject, and might well have been approached from other angles. I have endeavored to bring out a few thoughts which are vital for the industry as a whole. I have attempted to stress the need for detailed selling plans, selection of suitable selling materials, and to point out the need for constant supervision so that salesmen will a t all times remain loyal and aggressive and study more or less constantly to keep abreast of developments in the industry and in their own companies. I t is interesting to note that this symposium includes subjects touching on these various factors, which gives proof of the general interest that is current on chemical selling problems. All of us will do well to heed the warnings that are so clearly evident, and to do our utmost to develop our salesmen and our training programs to enable the industry to show a continuance of the marvelous growth record already established in an age xhich we can truly call "The Chemical Age."
