Situation
Horizon-Bradco has three divisions, four locations, and over 300 team members. They are industry leaders in commercial food equipment, refrigeration, and HVAC maintenance, repair, sales, and installation.
The organization is composed of multiple merged companies with similar target markets and customers, but different products and services. The big picture sales growth strategy was clear: reorganize and standardize the sales organization and processes and leverage both vertical and horizontal integration of each acquired business to achieve greater sales at higher margins.
The PE Portfolio Company Was Struggling
Prior to the pandemic, this combination of PE portfolio companies (or roll-up) was struggling. The PE firm and bank were concerned. The PE firm wanted an exit, and the bank wanted its money back! The PE Portfolio Company needed to improve sales…and fast.
Sales needed to deliver profitable quarter-over-quarter topline increases to improve EBITDA to keep the bank happy. Delivering consecutive quarter-over-quarter profitable sales growth would increase the total value of the business, thereby positioning it for a more lucrative exit for the PE firm.
In addition, each acquired company in the roll-up divisions had their own sales team, using different sales processes and different compensation plans. As a result…sales metrics were lacking. Standardized sales stages and processes were not being used to support repeatable, measurable, and scalable sales growth. Many large important key accounts lacked sales growth plans.
For the team, no sales skills training or coaching was being provided, and there was no cross-selling or upselling product training. This led to sales motions usually being reactive, instead of proactive.
All of these factors, combined, led to inadequate support for the company’s longer term strategic growth goals.
Objective
The company had 4 key objectives:
Position
company for greatest
valuation
Increase top-line revenue sales to achieve or exceed goals consistently and predictably
Increase profit margins to achieve or exceed profit goals consistently and predictably
Gain visibility
to the sales activities and pipeline
Action
In late 2020, the PE firm brought in Mark Kesti of Innovo Sales for an initial assessment of the situation. After reviewing the recommendations, they decided to make Mark Kesti the outsourced VP Sales in early 2021 to help guide the way forward.
A Sales Effectiveness Report was completed in Q4 2020. The report identified sales growth strengths, weaknesses, and immediate opportunities for sales growth. Innovo was then engaged to implement the prioritized sales growth recommendations identified in the Sales Effectiveness Report.
He implemented a CRM, defining sales stages that supported one unified sales process for the multiple sales teams, and defined ideal customer profile and personas.
In addition, Mark conducted weekly sales team meetings and one-on-one meetings with every salesperson…reviewing opportunities, discussing strategies, and coaching them for success.
The compensation plan was also reworked to motivate the right behavior and collaboration among the sales team. This was done in a way that supported immediate revenue needs and strategic goals for the company, including incentives for cross-selling between divisions.
To approach and win larger accounts, Mark also created strategic account penetration plans.
Results
Watch this short video by Mike Jewett, CEO, Horizon-Bradco
for more background on this case study.
The results achieved were notable:
- Year-over-year sales increased by 16% (even amidst the global pandemic).
- Sales increased each quarter.
- Targeted large and key account growth plans were implemented increasing sales and pipeline.
- A culture of collaboration and incentives between sales teams produced cross-selling opportunities and additional sales.
- Sales metrics were consistently measured. This reinforced individual accountability to overall sales results.
- Multiple sales processes were standardized to one unified process, all integrated in a CRM. This provided the mechanism for a scalable sales growth engine.
- A standardized compensation plan was implemented across all sales teams. This improved the efficiencies of the centralized accounting department resulting in more timely paying of commissions.
As a result of all this, the company received an attractive acquisition offer.