On a recent day with one of our reps, we stopped to deliver some emergency product to a key account.

The Shop Superintendent was appreciative of our personal delivery: the account had two welders out of welding gas who could now get back to work. We also discovered this customer was taking competitive bids for new equipment. After we left, I learned the rep hadn’t charged for personally delivering the product. His response to me was, “It was part of the sales call; I needed to see him anyway.”

How much should you charge for emergency deliveries? Are customers that expect free emergency deliveries the same customers who regularly check your prices and require you to match competitive bids?

When is it appropriate to charge the customer for making an emergency delivery? What guidelines should you use? Here are some questions to help you make that decision:

• How soon does the customer really need this? Have you verified if UPS next day would be okay?
• What systems can I put in place to change this expectation? Emergency deliveries may be appropriate to help new customers until your company understands their buying habits, but develop systems quickly that minimize future emergency deliveries.
• How does the customer perceive me? Are you giving customers the “delivery boy” impression or do they see you as a sales professional? If you are unable to answer this question, chances are you are allowing customers to adopt the “delivery boy” mentality toward you and your organization.
• What is my daily delivery frequency? Count the number of weekly emergency deliveries; set a goal to reduce your total by 25%. Change your delivery habits.
• What am I being paid to do? In our industry, an average direct cost per salesperson delivery is $60; with $20 more in indirect cost. Sales people are paid to SELL, not make FREE emergency deliveries.

The customer in our story consistently required us to match the lowest bid on new equipment prices. A profit evaluation of the account also revealed this account had one of our lowest gross margin percentages.

After reflection, the rep realized his customer had developed unrealistic service expectations. We performed a productivity enhancement analysis resulting in higher stockroom inventory levels of a more effective product and package. It was a WIN-WIN situation; the customer reduced production downtime; the sales rep achieved a better profit margin in a key account and better call efficiency.

Don’t be tempted to make no charge emergency deliveries because it’s comfortable. Yes, we all like to feel needed. The real questions are: “WHY am I doing this?” and “Is this delivery helping me meet my strategic objectives for today?” Know WHEN to make emergency deliveries. The best reps make very few emergency deliveries and always strategize how even those rare occasions can be billed without incurring resentment.