News for the Hospitality Executive
Understanding Your Role in the Revenue Generating Process
Everything we do in life has a Purpose and a Methodology
by which that Purpose is achieved.
The Purpose of any business (including retail, hospitality and others where the customer comes to you) or professional organization is Revenue Generation, and the method by which this is accomplished is known as Sales.
When you have a viable product or service, a fair and competitive price, skilled management and properly-trained staff (and are up-to-date on technological changes), then Revenue Generation will result.
How profitable the revenue that is generated is, depends entirely upon how well-managed the business is and how careful it is in the risks it takes. Of equal importance is understanding the different roles individuals in an organization play and how that affects the final outcome.
Suppose, for example, that you supply Kumquats to distributors and users of food products (you can substitute whatever service or products you provide to an industry) let’s also theorize that you have numerous competitors all, or most of whom, are as reputable as you. Let’s also assume that you have good relationships with your suppliers and are purchasing Kumquats at the best available prices (do not assume that others do not have the same or better arrangements).Be certain also to clearly understand the role that each person or department in your organization plays, so that you can capture a large segment of the Kumquat user’s business.
All of those involved in this area have one goal, and that is to identify all of the potential users of your products and services. By developing and maintaining relationships with them they will, hopefully, have the incentive to “consider” purchasing Kumquats from you. In simple terms the role of your Marketing/Sales organization is to bring Revenue Generating Opportunities to the Company.Depending on the nature of your product or service, as well as the firms closing process, they may also be involved in the completing the sale. (see Management Section)
In addition to making certain all Departments understand their role in the Revenue Generating process as described herein, Management must be absolutely certain that once Marketing/Sales has brought an opportunity to the firm that its pricing structure, assuming competitors have equal quality products and services, allows them to make a reasonable profit on each sale..
In many situations, particularly where competitive bidding is involved and the final closing process involves hands on management involvement, Management bears the full responsibility for converting the “Opportunity” into ‘Revenue Generation” recognizing that there are other like firms who also have been provided that “Opportunity” by their Marketing/Sales Staff.
Success in this process depends upon how well organized the business is, whether the middle managers are doing the right things and whether management’s vendor relationships give it a competitive position.
More often than not the customer’s final decision, while based upon low bid, may rest solely upon whether the relationship between the Marketing/Sales organization of a firm’s Staff is so strong as to cause the customer to give Management a final opportunity to be awarded the bid.
The role of Customer Service is to respond quickly to customers who call, or in anyway indicate that they have a problem, or concern about your products and services in a caring and personal manner. It is important to understand that those involved in customer service be persons who want to help others, while Marketing/Sales persons need to be persons who are able to ask others to help them i.e. ask the right questions in order to ensure that in the process of serving the customers needs they also identify revenue generating opportunities.
In addition to establishing credit worthiness this Team needs to understand that their role is to collect the money and at the same time keep the good will of the customer. It is management’s job, not Accounting/Credit to determine if a customer should be denied credit. There may be extenuating circumstances that may need to be considered.
All of a Company’s employees, from the Warehouse/Delivery to the Maintenance Staff need to understand that they play a role in the firm’s Revenue Generating process by making certain the facility is clean and that any communications they have with clients is professional and curteous. No one individual is responsible for a firms profitability and success – all individuals in the firm have a role to play and a Management that recognizes that benefits the most.
Some Closing Thoughts
1. In any business relationship being “Liked” is far less important than being “Respected”
2. “When making business decisions worry less about whether it is Legally Correct and far more about whether it is “Morally Right” (Sam Horowitz Founder of Interstate Restaurant Supply Company”).
Bernard S. Otis
Bernard S. Otis Consulting Services
Bernie Otis is a well known Writer, Speaker, Marketing/Sales Consultant, as well as a highly respected Food & Beverage Facility Planner and Equipment Specification/Installation Consultant.
His recent Book Revenue Generation Through the Sale of Kumquats----and Other Things has been endorsed by the University of Michigan S.S Kresge School of Business
15270 Sutton Street #109
Sherman Oaks, CA 91403
(800) 230-2928 Access Code OO (Cell & Office)
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Independent Advisor & Consultant to
Kamran and Company, Inc.
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(800) 480-9418 Extension 107