The Valley Winery
Pat Waller was the recently hired sales manager of the San Francisco region. Despite favorable sales result, the problem was that the turnover rate was so severe. The high turnover rate was a problem nationwide, but they did not expect such high figures for San Francisco. Two facts to consider.
1. Average sales rep had been with the San Francisco division of Valley Winery for only seven months.
2. The sales force turnover neared 100 percent a year.
The growth and success can be due to two broad factors.
1. They produce wine of consistently high quality at relatively low prices.
2. They use a push strategy which is considered to be the most aggressive and innovative in the Industry.
The winery had experienced numerous changes due to Carl Roman, who has a passion for detail and success. Carl Roman had introduced different organizational divisions. Along with this the winery bought out the San Francisco distributor which increased the number of sales reps from 15 up to 50 to call on chain stores. These factors contribute to the favorable sales result.
I believe that the winery would be more profitable if they lowered their turnover rate by re-analyzing their recruiting, hiring and training methods. The average recruiting and training costs are $25,000 per year per representative. There are lost opportunities resulting from the high turnover rate because accounts are not being called on. There are costs associated with the time it takes to adequately develop a relationship with the accounts. I would decrease the number of sales reps which in turn would reduce the recruiting ...