Electric Supply Inc. – SMP Value Proposition

Electric Supply Inc. – SMP Value Proposition

Our goal in this Value Proposition is to identify and understand your company’s current environment, discover your goals and where you’d like to be, and share how SMP is uniquely suited to help you accomplish your goals.

About Electric Supply Inc.

  • Florida’s largest independent electrical and voice data video distributor, serving both local and international electrical contractors, utility companies, industrial facilities, institutions and low voltage installers
  • Electric Supply Inc. differentiates from competitors through their commitment to high levels of customer service and the power of “Yes, we can” attitude
  • Significant investment in technology to increase operating efficiency and create outstanding customer experience (Warehouse systems, advanced MIS systems, online and mobile app ordering at no charge)
  • Active IMARK member company
    • 2019 IMARK Electrical Member of the Year
  • 160 employees
  • 2 locations
    • 90,000 sq ft Distribution Center and Headquarters in Tampa, FL
    • North Florida Office in Wildwood, FL
  • ERP: Epicor Eclipse

Key Stakeholders

  • Harry Irwin, President & CEO Electric Supply Inc.
  • Shaker Brock, CMO/CTO Electric Supply Inc.
  • Matt Coffey, COO Electric Supply Inc.
  • Shariette Jones, Marketing Manager Electric Supply Inc.
  • John Bryant, eCommerce lead and CRM initiative driver Electric Supply Inc.
  • Joe Raventos, President SMP
  • Chris Tucker, Senior Account Manager SMP
  • Mary Ann Carroll, Director of Client Services SMP

Value Discovery Insights

Electric Supply Inc. is highly efficient and uniquely positioned for success in a very competitive market. They are among industry leaders, generating nearly $1M in annual revenues per employee. Electric Supply Inc. is looking to leverage CRM with actionable analytics to drive toward their goals. Key initiatives are implementing a centralized customer management database to leverage contact and customer segmentation, improved highly targeted marketing based on segmentation and data driven opportunities, closing more bids and quotes, and capturing ownership of intellectual property relating to customer relationships. 

Value Proposition A: The advantage of a centralized customer management database
ROI = $5,000 additional GP per month

  • SMP’s integrated CRM and BI empowers actionable analytics leveraged in one central Sales and Marketing database
  • All customers, contacts, buying history, and notes in one easy to access place
  • Enables you to nurture your customer base and provide targeted messaging based on specific buying behaviors and segmentation
  • Easily identify opportunities, execute strategies tailored to opportunities, and monitor results for continuous improvement
  • Estimated Sales rep time savings in customer call preparation 1 hour per week (4 hours per month)

ROI from centralized CRM database

  • Assumption: Average close rate for bids/proposals = 20%
  • Assumption: Gross Margin = 20%
  • Assumption: Average GP per order: $250
  • Assumption using research: Produce 4 more proposals per month per rep
  • ROI calculation:
  • 25 reps x 4 additional proposals per month = 100 additional proposals per month
  • 100 new proposals x 20% close rate = 20 new closed orders per month
  • 20 additional orders per month x $250 GP per order = $5,000 additional GP per month
  • Total ROI from generating 4 new proposals per month per rep = $5,000 per month
  • Additional ROI from reps time savings in call preparation
    • 25 reps x 4 hrs per month = 100 hrs per month
    • 100 hrs @ $50 burden rate = $5,000 in time savings per month
  • Total ROI = $5,000 in new GP + $5,000 in time savings

Even if you gain only half of this benefit, ROI of $5,000 will more than pay for the monthly subscription for SMP

Value Proposition B: Targeted Marketing
ROI = $12,500 additional GP per month

  • Take advantage of your Customer and Contact Segmentation with SMP’s list management and actionable analytics
  • Easily export highly targeted lists of contacts or customers for use in email marketing tools, or to share with team members to execute strategies for targeted groups
  • Penetrate Customer accounts and grow share of wallet by easily identifying new data driven sales opportunities
  • Easily identify opportunities based on buying behavior and deliver highly targeted messages to the right people

ROI from integrated Target Marketing

  • Assumption: $150M annual revenues
  • Assumption: 1,875 active Customers (25 reps, each 75 assigned accounts)
  • Assumption: Average revenue per customer = $80K
  • Assumption: Gross Margin = 20%
  • Average annual GP per customer = $16K
  • Assumption using research: improve Gross Margin 3% over average peers
  • ROI calculation:
  • $16K annual GP per customer x 1.03 improvement = $16,480 GP per year
  • $480 new GP per customer per year
  • $480 new GP x 1,875 active customers = $900K new GP per year

Even if you gain only a half point of GP improvement: $80 new GP per customer x 1,875 customers = $150,000 additional GP per year ($12,500 additional GP per month)

Value Proposition C: Open Bid & Quote Follow Up
ROI = $3,333 additional GP per month

  • Assumption: Currently $10M in open bids in Eclipse
  • SMP’s Bid Closer process provides visibility, tracking and management of open opportunities
  • Easily see and manage pipeline, products, notes, influencers, etc. all in one place

Studies show that executing a defined follow up process can increase close rate by as much as 20%

ROI from closing more open bids & quotes

If close rates increase by only 2%, the est. impact from open Eclipse bids is $200K annually – at 20% Gross Margin = additional $40K GP per year ($3,333 additional GP per month)

Value Proposition D: Intellectual Property
ROI = $12K to $24K GP gained

  • Owning the customer intimacy information is key to a company’s success. (contact information, customer notes, open opportunities, and key activities)
  • SMP’s centralized database makes this information accessible to everyone based on permissions and roles and ensures that the company owns its intellectual customer information
  • Easily onboard new reps
    • SMP’s centralized CRM lets you instantly onboard a new rep with their account package including contacts, activities, open opportunities, notes and transactional history making it easy for them to hit the ground running
    • New reps will be more professional and prepared when meeting with their customers
  • Reduce customer attrition when a rep leaves and moves to a competitor
    • If this sensitive customer information is not in your database, your sales rep owns it and may be able to take 10-20% of their customers to their new company

Based on our experience over 20 years, your company can cut this risk in half by quickly and proactively transitioning accounts with all the customer intimacy to the new account manager

ROI from owning customer intimacy

  • Average annual customer revenue = $80K
  • Average number of assigned accounts per sales rep = 75
  • Average sales rep annual sales = $6M
  • Potential revenue loss if rep leaves to a competitor = $60K – $120K
  • Plus easy onboarding of new reps and account reassignments

If just one rep leaves to a competitor, potential revenue loss is $60K – $120K.
At 20% Gross Margin, ROI potential is $12K to $24K additional GP per occurrence

Value Proposition E: Dashboards and Reporting
ROI = assume no gain

  • SMP’s award winning Qlik dashboards and analytics tools are always available for self-serve user access, greatly reducing the time investment required to generate and distribute dashboards and reports
  • All users are able to always access SMP’s self-serve dashboards, scorecards, data analytics greatly reducing the burden of time required by management team to report

    ROI Summary

    SMP is uniquely positioned to help your team succeed with Value Propositions A, B, C, and D.

    SMP is also uniquely positioned as the only CRM solution that is an Epicor ISV partner, as well as the only CRM approved as an IMARK Member Service Provider.

    Total ROI

    • Value Proposition A: The advantage of a centralized customer management database
      • ROI = additional GP of $5,000/month
    • Value Proposition B: Targeted Marketing
      • ROI = additional GP of $12,500/month
    • Value Proposition C: Open Bid & Quote Follow Up
      • ROI = additional GP of $3,333/month
    • Value Proposition D: Intellectual Property & Customer Intimacy
      • ROI = additional GP of $12K to $24K per occurrence

    SMP Investment Summary

    Up front license and implementation fees: $26,250 discounted to $19,375
    Up front Epicor SMP interface license fee: $7,573
    Monthly subscription* for up to 50 SMP users: $3,125/month discounted to $2,500/month
    *Monthly subscription includes SMP Core, SMP Mobile, Outlook interface, Open Bids/Quotes from Eclipse
    Annual Epicor maintenance fee: $1,534
    Annual Qlik license fee: $2,000

    Total first year investment: $74,857 discounted to $60,482
    Annual investment thereafter: $41,034 discounted to $33,534

    Great Option: 24 month lease option* with no up front fee and NO INTEREST: $3,474/month
    Monthly subscription thereafter: $2,500/month
    *Lease option does not include Epicor license or maintenance fees

    SMP Value Proposition Summary
    SMP uniquely presents Electric Supply Inc. with opportunities to achieve their goals to create and maintain a centralized customer management database, create more effective and focused targeted marketing, improve open bid/quote close rates, capture ownership of intimate customer information, and more easily create and distribute dashboards and data reports.

    The potential monthly Gross Profit gain of implementing SMP is $20,833 (not counting GP retention if a rep leaves), while the investment in SMP is $5,041 per month in Year One, and $2,795 per month thereafter. Conservative ROI is over 4.1X in Year One and over 7.4X thereafter.

    Perhaps the most important factor is the opportunity cost of $20,833 per month by delaying implementation of SMP.

    Take advantage of the benefits and ROI of SMP’s CRM with built-in actionable analytics and the 24 month lease option at no interest.

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