Overcoming Bribery in Business

October 5, 2010 6:38 AM

My customers get great bribes! How can I overcome this ethically?

I am a sales manager of a group in the US that is dealing with customers in an industrial environment, specifically in purchasing. Our company has a very strong ethics policy (that frankly is the only thing you can get fired for). We, as a team are trying to develop a plan of action that can eliminate or greatly reduce the presence of a good ol' boy sales force that routinely includes high-dollar gifting, selling at a loss and is pretty much ruthless in their tactics. As a group, we want to maintain our professionalism and quality of ethics while grabbing market share. Thus far, we are at a loss. Too many times, we cannot go over their heads, and cannot overtly prove they are taking bribes, nor do we wish to drag ourselves that far down. They are much smaller then us, and have been in business a long time. Certainly, we can't tell the customer who to buy from and that they are bad in making their pockets fatter. Any suggestions are welcome!

posted by anonymous to human relations (8 answers total)

Don't go down this road. If they are selling at a loss/giving expensive gifts then its shitty markets share to have anyway. If you are incentivized on market share without regard to profitability then you should talk with your superiors about changing the comp program.
posted by JPD at 7:22 AM on October 5, 2010

Your question isn't really clear to me. Are you trying to figure out how to win over customers without bribing them in an environment where bribery is the norm? Please email a mod with some clarification...
posted by bardophile at 7:22 AM on October 5, 2010 [2 favorites]

It sounds like the customers see your product category as a commodity. In the absence of any compelling product differentiation, why not buy from the guy you've known for years, or the guy that hooked you up with floor seats for a game or show, or the guy that can expense a night at a strip club.

Basically, you need to present a compelling reason to buy your product over the competition. If all the competition has is Mad Men style wining and dining that really shouldn't be too hard to do. And if it is, your problem is not in the sales department. It's marketing or product development.
posted by COD at 7:28 AM on October 5, 2010 [2 favorites]

You say industrial environment. Are your customers large enough that you can become part of a preferred vendor program? Can you beat the unethical competition by making it more efficient for your customers to order online through a dedicated portal that is integrated with their systems and offers customer-specific pricing or discounts?

Basically, if your customers are large enough institutions, someone in purchasing is probably highly incentivized to save their company money - not just on sticker price, but on the entire cost of ordering [that thing you make] through whatever channels they use to purchase it. Find this person. Figure out what they need. Develop a solution to fit it.

And yeah, more clarification would probably be helpful.
posted by deludingmyself at 7:36 AM on October 5, 2010

Is the "good ol' boy sales force" that you are trying to eliminate part of your company, or are they your competitors? As currently phrased your question doesn't make any sense. You should contact the mods to have it fixed or post an update.
posted by alms at 7:38 AM on October 5, 2010 [1 favorite]

Is your product better? If so, give them a free trial or a deeply discounted starter sample. If, after sampling your product, they prefer to deal with the other company, there's really nothing else you can do except compete via bribes.
posted by prefpara at 8:36 AM on October 5, 2010

Sounds like your group needs help in the marketing department. Every sales group I know of sells certain items or upgrades at a loss - they're called "loss leaders" and its a way to draw people in to buy the items that will turn a profit. For example, when you get a sale flyer from the grocery store and it has a special for a gallon of milk for $1.00!!!! they're losing money there, but hoping you'll buy the $4.00 box of cereal, which has a high profit margin, to go with your milk. Oh and while you're in the cereal isle, don't those pop-tarts look good...

If you are dealing with large, established organizations or companies, a signing bonus (a check made out to the company) is a normal part of a multi-year contract, meaning they agree to do business with you for x years. These contracts typically also include things saying that sales must be at least $x per quarter or some of the bonus money needs to be refunded etc. This is the job of your legal department to figure out.

Basically, what you see as "bribes" are not really bribes. They are standard business. Your company needs to be able to do some analysis and incorprorate some loss leaders and whatnot while still maintaining a profitable ENTIRE package. It's about the whole, not the part.
posted by WeekendJen at 8:43 AM on October 5, 2010

Are you competing outside your domestic market ? You mention you are a US based company yet the implication seems to be how to compete in a very different operating environment without breaking your home country rules, is this correct?
posted by The Lady is a designer at 1:23 PM on October 5, 2010