Ortho 500 Sales strategy FormPrint FormPrint was established in 1998, and designed 3 dimensional prototypes through patent protected technology technology FormPrint FormPrint mainly !ocused on health"care application #y end o! $013, FormPrint had sales o! %&$9 'illion FormPrint FormPrint is launching ortho500, ort ho500, a new 3( printing system which could print custom e)os*eleton e)os*eleton orthopedic splints, braces and cast according to the body o! each patient +he planned price !or this Ortho 500 product is %8,000 and the target mar*et is outpatient department across -S, which had a mar*et share o! 1.. million -S( Ortho 500 Strengths
ease o! use, o/erall per!ormance
ea*ness
Functionality
#ut as per the sur/ey !or 3( printing the !unctionality o! the system was not that important ! ortho500 !ailed to establish a leading mar*et share in e)os*eletal e)os*eletal bracing in $01&, Formprint2s Formprint2s medical product di/ision could !ace layos
'anagement (ilemma 4ow to mar*et Formprint2s new orthopedic 3( printing system Should they enter the mar*et through ndependent sales representati/e or should they go with Formprint2s sales representati/e hich will reap them a ma)imum bene6t
Solution Since FormPrint is entering into a new mar*et and on tight budget n this situation, blended o! S7"(irect sales approach would result in more !a/orable results ach Formprint2s sales representati/e cost about % &00,000, this cost to company is not concerned or not with respect to selling ortho 500 ! we allocate an addition o! % .5,000 to % &00,000, and considering the le/el o! e)pertise o! FormPrint sales representati/e o/er period o! 1$ months i! the Sales representati/e can achie/e target o! selling Ortho 500 printing system Since the e)pected sales cycle is 0 days
1 $ 3 & 5
ost to Sales Person Ortho 500 Sales target allocation Sales cycle !or Ortho 500 )pected Sales o! 'achine in a year +otal re/enue generation !rom Ortho 500:per sales person; +a) $3<
&00,000 -S( .5,000 -S( 0 days &08,000 -S( &08,000" 938&=398,1 -S(
From the abo/e table, at 8,000 -S( pricing o! Ortho 500 the sales representati/e cannot achie/e their target co/ering the cost o! selling based on the Sales cycle o! 0 days #ut i! the allocation o! .5000 is considered within the + o! &00,000 -S(, then this will be a pro6table model #ased on the pre/ious e)perience employing S7 FormPrint has to hire to manage these S7 and the cost >umped to 3.< o! the
sales #ut instead o! hiring management can assign $ S7 under the FormPrint sales representati/e ?ow let us consider the cost aspect with respect to ndependent sales representati/e 1
ndependent Sales 7epresentati/e ost o! Sales :$3< o! Sales;@Plus ta) Sales ycle o! ortho 500 0 days +otal re/enue generated 7e/enue a!ter ta) ost o! Sales on total re/enue
1.,$0& -S( units Per Annum &08,000 -S( 30&,.. -S( 103,$$&
+he #ene6t in case o! S7 is that, FormPrint will ha/e /ery less 6)ed cost !actor ith S7 there is no initial ris* because FormPrint will not be responsible !or their health and retirement bene6ts +hus FormPrint has to shell out commission o! $3< plus $3< as ta) e can ha/e an agreement with S7, such that i! he !ails to per!orm his responsibilities they can terminate his contract, i! there is no producti/ity hen S7 deli/ers signi6cant amount o! re/enue to FormPrint, then FormPrint can hire him !ull time with + ait !or the sales cycle to complete and e/aluate the !easibility o! continuing with them ! the cost to company is less than annual sales done by them, we can train them !urther and continue with S7sB else !all bac* on in house sales reps +he only issue with S7 is 1; +here cannot be complete control o! independent sales representati/e
$; +he training aspect depends on the ability o! S7, which cannot be measured
