Ralph Jackson sells industrial lubricants to manufacturing

Ralph Jackson sells industrial lubricants to manufacturing plants. The lubricants are used to lubricate the plant’s machinery. Tomorrow, Ralph plans to call on the purchasing agent for Acme Manufacturing Company. For the past two years, Ralph has been selling Hydraulic Oil 65 in drums to Acme. Ralph’s sales call objective is to persuade Acme to switch from purchasing oil in drums to a bulk oil system. Last year, Acme bought approximately 364 drums or 20,000 gallons at a cost of $1.39 a gallon or $27,800, with a deposit of $20 for each drum. Traditionally, many drums are lost, and one to two gallons of oil may be left in each drum when returned by customers. This is a loss to the company. Ralph wants to sell Acme two 3,000-gallon storage tanks at a cost of $1,700. He has arranged with Pump Supply Company to install the tanks for $1,095. Thus, the total cost of the system will be $2,795. This system reduces the cost of the oil from $1.39 to $1.25 per gallon, which will allow it to pay for itself over time. Other advantages include having fewer orders to process each year, a reduction in storage space, and less handling of the oil by workers.


If you were Ralph, how would you plan the sales call?