Sales: Which Customers Do We Protect?

Wednesday of the second week, and the document on Marcus Reid’s screen is one board too long. Tomasz’s protected list reads Harlow Hotels 180, Nordfoods 240, Bellwether Cruise Lines 60, St Chad’s Regional Health 40, Acme Bakery 1. That is 521 boards. There are 520 in Rockford.

One board. It sounds like a rounding error and it is not, because a board is an oven and an oven is a customer with a name and a date. Marcus cannot add a customer to that list without taking one off it — and behind him sit 275 units across some 200 smaller orders, each with an account manager who has already explained why their customer is the exception.

What lands on Marcus’s desk

From Tomasz comes Friday’s allocation: 520 boards ranked by margin per board — $5,320 on a Meridian, $1,560 on a Compact, $6,820 on a Rack — phased into dated tranches. From Yusuf comes the demand behind it, cleaned to 826 firm units rather than 960, with every unit of softness sitting in the unprotected tail, so the squeeze is real. From Claire comes the distinction that reframes the job: revenue that slips into next quarter is painful, and revenue that leaves permanently is a different substance.

Over it all sits Ravi’s objective — protect first the relationships that cannot be bought back at any price — and one rule of order: no customer hears a date until Friday. The last board-fed oven leaves the line on Friday 17 April. Marcus cannot make an oven exist. He can only decide whose.

What a sales director actually does in a shortage

Most of the year the job is demand creation — pipeline, pricing, quota. A shortage inverts it. What Marcus owns instead is knowledge held in no system: whose deadline is a preference and whose is a wall, which buyer has been quietly running a second supplier for a year, which contract manager sits on a contract renewal panel. None of it can be computed; somebody has to assert it and sign underneath.

Nor is he the customer’s advocate here: there are 520 boards whatever he argues, and his job is to distribute disappointment deliberately and defend it out loud.

The software on Marcus’s desk

The CRM holds order value, history and renewal dates, and would happily rank the six accounts by size. That ranking is the trap the whole module exists to explain: it protects this quarter and quietly concedes Nordfoods, the account most able to leave permanently.

The contract file supplies the one precisely knowable number in the crisis, Harlow’s liquidated damages, and precision is exactly what makes it dangerous in a comparison against un-penalised losses nobody has quantified. The decision itself lands in Excel, where the 521-against-520 squeeze forces a name off the list — and then, crucially, back into the CRM as a single shared commitment schedule. That last step is what stops eleven account managers making eleven private promises, which is the failure mode that turns a difficult quarter into a lost year.

The decisions

Why order value is the wrong ranking

The instinct is nearly universal: protect the biggest orders. Ranked that way the six read Harlow at $2.52m, Nordfoods at $1.44m, Bellwether’s sixty mixed units well behind, St Chad’s at $240,000, then Peninsula, then Acme Bakery’s single $6,000 oven, last of everything in the building.

That ranking optimises this quarter and quietly dismantles the next three years, because it treats every dollar as identical when they are nothing alike. Harlow’s $2.52m is contracted inside a three-year programme, so most of it arrives whenever it arrives. Nordfoods’ $1.44m recurs every year until the year it does not.

So Marcus ranks by four questions instead. Can this customer leave permanently — not whether they will be angry, since anger is recoverable, but whether the volume can physically move? If they leave, can they be won back, and over what horizon? What does losing them cost beyond this order — a contract place, a reference, the loading of a line? And is their date real or merely stated? A stated date is a preference in a deadline’s clothing; a real one is a dry dock, or a bakery with one oven and nothing to bake in.

Run the six through those questions and the ranking inverts. Bellwether can leave instantly and cannot return for five years. Nordfoods can leave permanently and is halfway out of the door already. Harlow cannot leave at all. St Chad’s cannot leave this year but can lock Calder out for four more. Peninsula’s dates are genuinely elastic. And Acme cannot hurt anybody.

The six accounts, decided

Bellwether — 60 units, protected, earliest and complete. The dry dock cannot move, so sixty ovens one day late are worth precisely nothing: there is no vessel to install them in, the order is cancelled outright, and the ship sails without Calder for five years.

Nordfoods — 240 units, protected, phased in three deliveries of eighty. On the only measure that matters this is the worst order Calder holds: $1,560 a board against the $5,320 those boards would earn as Meridians, roughly $1.28m forfeited. Marcus protects them anyway, because Nordfoods is the largest permanent loss available — no penalty clause, price-driven, openly dual-sourcing. Be late once and the volume does not come back angry; it stops arriving. Every other loss here is a delay. This is subtraction.

Harlow — 180 units, protected in principle and the shock absorber in practice. Liquidated damages of $12,600 a week, capped at $126,000 — and the cap is the point, because it turns lateness from a cliff into a priced slope, and a priced slope can be budgeted. The refurbishment genuinely proceeds floor by floor, so a re-dated tranche inconveniences a project manager rather than closing a hotel. Hence the most uncomfortable conclusion here: a customer you can pay to disappoint is sometimes the right one to disappoint. That is defensible only because the three-year relationship survives it — the cap is a price, not a permission slip.

St Chad’s — 40 units, protected. The tempting reading is that they are safe: a group purchasing agreement, no way to switch inside a year. Read it that way and they go to the back of the queue, which is how suppliers lose public sector business. Lateness triggers a formal supplier review, and the review lands on the contract place at renewal — worth years of orders against one $240,000 order.

Peninsula — re-based to 30 units, deferred. A distributor holding buffer stock has real slack: it sells on from inventory, so a moved date is absorbed rather than felt. This is the right place to take the pain, and it is not a favour — absorbing shocks is what carrying stock is for. It has a price: they will ask for a discount, and Marcus fixes that ceiling in advance.

Acme Bakery — 1 unit, protected. No leverage, no penalty clause, no purchasing agreement, nothing to bring to a negotiation. It costs one board out of 520, and an independent baker with one oven is much the likeliest of the six to talk publicly — Marcus is honest that the reasoning is partly that. It is also a decision about what kind of supplier Calder wants to be: a company that honours commitments only when the customer can hurt it does not have commitments, it has a risk register. And the virtue is affordable precisely because it costs one board.

The board Marcus takes back

He is still one over, and the list does not improve by being admired.

Four candidates fail immediately. Acme’s board is the one he has just defended in principle. Fifty-nine ovens against a dry dock is identical to zero. A partly late contract delivery still triggers St Chad’s review. And every Nordfoods unit is a store opening against a loss that is permanent rather than deferred.

So it comes from Harlow, from the last tranche of the phasing, for the reasons that made Harlow the shock absorber: damages capped, known and survivable, and a refurbishment that genuinely runs floor by floor, so the 180th Meridian belongs to the last floor to close. Harlow takes 179 inside the window, the last unit in the first resumed batch. The list now needs 520, and no customer has been added.

Then he writes the reasoning down, dated, inside the schedule itself — the thing that separates a decision from an accident. When Harlow’s programme director calls, the answer is a documented judgement with a name on it. Suppliers are rarely forgiven for being late; they are almost never forgiven for not knowing why.

What salespeople must stop doing

The last decision is a set of prohibitions. No account manager may promise a date. No side deals. No quiet reprioritisation for a favoured customer. Every commitment goes through one dated schedule, and the schedule has one author.

It is the hardest instruction Marcus gives all quarter, because it removes the one thing a salesperson has always been able to do: relieve a customer’s anxiety in the moment. The requests come at the end of long calls, from people they like, when a small reassurance appears to cost nothing. It never costs nothing. It costs a board belonging to somebody on the protected list, and the planner finds out in week four. Allocation plans die this way — not overturned, eroded, one kind sentence at a time.

A prohibition alone is broken by lunchtime, so it ships with a substitute: the concession envelope, naming what may be offered without asking — a discount ceiling for re-dated deliveries, commissioning and training at Calder’s cost, an extended warranty, priority in the first resumed batches. Exceptions are not banned; untraceable ones are.

The part of this that feels wrong

Ranking customers by how much they can hurt you is not comfortable and should not be made to sound like it is. Nordfoods is protected largely because they are the readiest to walk away; Acme partly because a baker with one oven is the likeliest to talk publicly. Neither is a noble sentence read slowly. But the alternative is not fairness — it is fiction: holding every date, telling everyone what they want to hear, then failing all of them at once and without warning. Rationing openly is not fair either. It is honest, accountable and correctable.

Where this goes wrong

The 275 units outside the protected list are what goes wrong in real companies, and it goes wrong by omission. Nothing is said to them, because there is no good news and silence feels safer than a bad call. Silence is the one message that guarantees a customer phones a competitor. So the tail gets a position too, and an honest one: served from the resumed supply, with dates confirmed as they firm up.

What Marcus hands on

To Siân Pritchard goes the final protected list and the dated commitment schedule: Bellwether earliest and complete, Nordfoods in three tranches of eighty, Harlow at 179 with the reason beside it, St Chad’s forty ahead of the supplier review, Acme’s oven on its original date, Peninsula re-based with a concession attached. She inherits one constraint — she may vary the order, the channel and the words, but not a single date.

To Tomasz goes the same list with one line changed, Harlow 180 to 179, reconciling 521 against 520 without adding a name. To the sales team go the concession envelope and the prohibitions together, because either without the other lasts a week.

Spot the decision

Read each situation and decide how a sales director should handle it, then tap a card to check.