Death of the salesman: Humans lose as computers close more deals

Hill and Markes Inc., a 112-year-old janitorial and food service supplier, is as old school as old school gets. Several of its field salespeople have visited customers for 35 years, and until December 2016 its rudimentary e-commerce site lacked even photos of many of its products. Taking orders on a mobile app wasn't in the lexicon.

These days, though, this upstate New York company and its 50-person sales team are forging deeper into online retailing and looking to use more e-commerce-aided sales as field reps retire. The automation wave that has displaced so many workers in manufacturing and data entry is hitting the nation's sales force, particularly among "business-to-business" salespeople who sell to commercial customers.

"At some point, when the client falls in love with the web portal and the company starts using algorithms to cross-sell and upsell, pretty soon that salesperson is not doing much," said Andy Hoar, a former Forrester Research analyst who now runs a consulting firm, Paradigm B2B, in Chicago. He says customers' preference for online purchasing has only increased in the past three years since he predicted that as many as a million B2B salespeople could be cut by 2020.

Software companies have been reducing their reliance on field salespeople for a few years as they sell more cloud-based software. Now, big distribution companies like Rosemont-based US Foods Holding Corp. and W.W. Grainger Inc. in Mettawa are trimming their field sales and showroom staffs and dedicating those who remain to their biggest customers. Smaller clients speak with telephone salespeople and digital marketers. In some cases, field reps will see bigger paychecks as they're freed up to go after more lucrative clients. Many others, though, will see their compensation inevitably fall, e-commerce consultants say.

Behind the push to bring sales teams inside are a greater willingness among purchasing managers to buy even expensive items online and new digital analytics tools making it easier to target them. In 2015, Forrester polled B2B buyers and found that 53 percent preferred researching orders online to dealing with a salesman, and by a year later it had grown to 68 percent, Hoar said.

Restaurant supply giant US Foods had 4,000 salespeople visiting independent restaurants in 2013, but has invested heavily in its e-commerce operation since then and now counts about 2,700 salespeople. The remaining reps are the better salespeople covering bigger territories - the company's "Michael Jordan" sellers - executive Vice President Jay Kvasnicka told investors in March. While cutting some reps overall, the company has invested some of the savings in a new "team-based selling approach" giving customers access to chefs, restaurant operations consultants and others, spokeswoman Sara Matheu said.

W.W. Grainger, an industrial and commercial distributor with $10 billion in annual sales, has cut its local store count to 251 from 390 five years ago in part because of a shift to e-commerce, according to regulatory filings. Meantime, it reassigned a portion of its roughly 3,000-person sales staff to create 400 inside sellers, spokesman Joe Micucci said.

At janitorial supplier Hill and Markes, e-commerce manager Mike Powers says field reps will be used to demonstrate equipment such as new floor scrubbers. Today's customer, he says, "is not interested in you showing up every Tuesday with doughnuts."