Accounting in Action

Transcript of Interview with Nicole Wilson, Senior Key Account Manager, pharmaceutical company

Recorded February 2019

this was one is the podcast

have to answer it by looking podcast

1.What did you learn from this podcast that changed your perceptions about how accounting information is used by sales person?

Rasmussen: "Welcome to another episode of Accounting in Action. My name is Stephanie Rasmussen, and I'm an Associate Professor of Accounting at the University of Texas at Arlington. Today, I am joined by Nicole Wilson, who is a Senior Key Account Manager at a pharmaceutical company. Welcome, Nicole."

Wilson: "Good morning. Welcome."

Rasmussen: "Can you tell us a little bit about the types of product that your company sells and the types of company, or, customers that you sell to?"

Wilson: "Sure. So I work for a vaccine manufacturer, and so we sell vaccine immunizations, like flu shots and shots for babies, shots for adults. And I call on health systems, I call on hospitals, kind of the larger organizations, and work on contracting. I might call on public health departments and those types of customers that, you know, kind of the large, organized customers that own or work with, you know, different satellite offices within a given geography."

Rasmussen: "Okay. And how long have you been in this type of industry?"

Wilson: "So I'm just finishing my 22nd year at my... in this industry."

Rasmussen: "Wow."

Wilson: "So, been a long time."

Rasmussen: "Yeah. Was this an industry you specifically targeted to work in after you graduated from college? Or how did you get into pharmaceuticals?"

Wilson: "No, this actually was my fourth job in three years. So I was 21 when I graduated from Texas Tech and knew that I wanted... well, thought that I wanted to be in sales. I had a degree in Marketing, so I started out with a company called Cintas and sold industrial uniforms, laundry service, and then moved... left a Fortune 500 company in my infinite wisdom as a 21-year-old and went into a small working cattle ranch and sold parties and meetings at their facilities, weddings and things like that. They went out of business three months after I was hired, and so I moved... I was living in Houston at the time, and so then I moved to Dallas, lived with my parents which was not something that I wanted to do after I graduated from college, and sold copiers. After that, and then I kind of considered this job as a gift. I wasn't looking for it, I didn't know that I was stressed out and, you know, I mean, I was wearing a mouth guard and all those things that come with stress and having, you know, a quota. And one of the people that I worked with had left the company, and his recruiter had asked him if he knew anybody. And my name was given and I had a couple of calls, and, you know, the rest is history."

Rasmussen: "Good! Interesting. So, in sales, what role does accounting information play in your day-to-day-activities or in your monthly activities?"

Wilson: "So, it depends on the kind of product you sell. I mean, it hits all of them. So, accounting, finance, I mean it's all part of running a business. Sales is a part of running that business as well, and so, my job is to sell the product so that we can make the money to, you know, provide the shareholders if it's a publicly traded company the value that they need to continue to invest. And so, that in and of itself, I have a quota, I have... I'm talking to customers about how they're going to spend their money and how they're going to work with their budgets and meet their demands. And of course, you know, so, in my current position you're talking about health care, which is highly regulated and very expensive. And so, cost matters. Everything, you know, health care is moving towards a value-based model, so they're really trying to, you know, keep up with, is the medicine going to actually result in a positive action on somebody's health, not just how much does it cost and what's the cheapest thing out there. And so, it's held to a different standard. When I sold copiers, you had, you know, we had a price that I couldn't go under, and then the rest of it was up to me, and my commission was based on what I could sell above that base price. So it really just depends on what kind of product you're selling and what industry you're in, but you're always managing... Are you making a number? Are you above cost or are you below cost? Are you cycling inventory? So I think that it's, I mean, like it or not, accounting is a daily part of everything you do in business, whether you're the actually accountant keeping up with the numbers, or the person out there trying to sell the goods."

Rasmussen: "Now, one thing you mentioned was inventory. Can you tell me a little bit about what type of inventory information you're looking at? Is that for your company's inventory or your customer's inventory?"

Wilson: "Sure. So there's both. If I take it to a really granular level of what we do in a doctor's office... so when you sell vaccines, this is something that's not a prescription; it's a direct sale. So in other pharmaceuticals, if you have allergies they're going to write a prescription for you and you're going to go to the pharmacy and get that filled. And so, they deal with inventory a different way. For us, the doctor's office buys the product from us directly, we ship it to them, and then they manage inventory so they have an idea... if you call in a pediatrician it's all about how many babies, how many births, how many newborns they see in a given month, because every baby gets a certain number of this kind of an immunization, a certain number of that. And so, you come up with kind of a monthly target level or par level of what you want to have. The idea is that you have enough so that the parent when they get there, they worked hard, they've taken off of work, they've done a lot of things to get their child to the doctor. You want to make sure that they're able to get the service that they need and not have to come back because they didn't have it. And so, but you also don't want to carry too much inventory because that's money. It's very expensive, and it's sitting in the refrigerator not being used. And so, you come up with kind of an average usage based on looking at maybe 12 months, look back on how they function, and you try to, you know, get as close to a just-in-time as you can and also giving a little bit of a cushion so that if all of a sudden there seems to be, you know, all of a sudden there's 10 two-month-olds that come in this week and then you're out of product."

Rasmussen: "So, if the doctor's office is starting to run low, how quickly can you get more vaccines to them if they need it?"

Wilson: "So, we ship, again, we ship directly from the manufacturer, and so from us, so, our... We're based in Pennsylvania, but we have deep distribution centers throughout the country. And so, the closest one that impacts the Texas market is Atlanta. And so, we use FedEx and UPS to get it to us, so we're in a two-day shipping zone. We can do overnight shipping, but of course that's an additional cost. So it's really... we try to work with our customers to make sure that they're more than three days ahead of where they need to be so that it's not stressful and, you know, you try to, you know, get maybe a week out before you're worried about how close you get to it."

Rasmussen: "Okay. Now, are your products sold at a standard price all the time, or do you ever have sales promotions you're dealing with?"

Wilson: "So we have price changes roughly once a year, and that's decided by our senior leadership that, you know, accounting executives and financial executives that come up with how to evaluate what's the value of our product in the marketplace, and still be competitive. But there are times because again, if you're a publicly traded company, it matters if you make the month, and you make the quarter, and you make the six months, and you make the year, you have to make these financial targets all the time. You can't just look back and say, "Well, I'm going to make that up next time." And so, sometimes we have promotions to make the month or make the quarter or whatever it is. And so, there might be a discount, not, you know, a tremendous amount, 1-3%, something like that. And we might extend how long they have to pay. Again, these are expensive things, and it might... if they take on a big supply, they may not use it all in a given time. So you try to extend how long they have to pay for it. But we do do that. We haven't done it in a while. And I think that's just a change in... we sell some pretty mature products at this point in their life cycle. Theyre not new. And so, you know, again, the age of a product and how long it's been around I think plays a role in those kind of decisions, but it used to be pretty common that back to school, we would have a promotion. And again, it's always tied into the end of a quarter. Back to school, year-end, maybe if you've made your number and you're trying to push as many sales as you can into the next year, you do that. Or vice versa, you haven't, and so you're trying to get them to look into January and pull it into December to make a number."

Rasmussen: "I remember that even from my experience. I worked for a technology manufacturer, and again, you want to make the number and there were a lot of pushes at the end of the year, especially, so... So, I think I have a lot of marketing students. I think this will be really interesting to them, what you've been talking about. Now, thinking back to when you were a student, you took... you must have taken accounting because you were a Marketing major. What was your perception of accounting and the classes you took?"

Wilson: "I really struggled in accounting. To me, it was, you know, it's the paper ledger, and it was just trying to get the debits and the credits to match, and I never could. I'd have some calculation off, you know, 27 entries ahead, and I had... so it's... it was just not something that I was passionate about. You have to pass the class to get your degree in Business, and so, I can say that I passed my classes, barely. And so, you know, my overall... and I really thought that I was done, like okay, I'll never have to deal with accounting ever again, hallelujah. And that's not been the case. But it's okay because now that I'm doing something that I like and it's my job and it's my career, actually more than my job, it's different than if you're just doing something because somebody said you had to do it."

Rasmussen: "Sure. Well, and you're not doing the journal entries."

Wilson: "Correct. I am not the accountant. That is a fact!"

Rasmussen: "Do you have any advice for current college students?"

Wilson: "I would just say, stick with it. College is a grind, and learn as much as you can but don't get caught up too much. And maybe this'll be something I shouldn't be saying out loud, in that everything that you learn today, you have to be perfect at it and that you will implement it immediately when you get out of school. Some of these things that you're learning will come up later, and you'll be happy that you at least were introduced to the idea because to me, college is more about the thought process and showing that you can complete something that's hard to do. If you look at the percentage of students that actually graduate, or I should say the percentage of people in the world that actually graduate from college, it's a really small percentage. And so, what you're doing is hard. And so, and you will immediately be in a special club because you were able to do it. You're around people that are all there doing it, and so you feel like you're an ant and that everyone's getting it, and that's just not the case. The opportunities that you will have because of your degree, at some point, are going to be something that you can really look back on and appreciate. It may not be immediate. It may take you a minute to get a job. It may take you longer than you thought it would, and you're not going to make the money you think you... thought you would make when you graduated from college. But eventually you're going to look back and say, "I would have never been able to do this had I not had this." The job I have today requires a college degree, and so I immediately have opportunities that I wouldn't have if I didn't have that. So I would just encourage you to gut it out. Do what it takes to finish the degree, get it, and then figure out what you're going to do because what you... unless you're an accountant, if you... I mean, accounting is a very specialized... I shouldn't say that. From my perspective, it's very specialized, versus marketing, you know. And I guess now universities have sales degrees which is really cool because that didn't exist when I was in college. You don't have to do what you got your degree in, but it does help you show others that you can finish a hard task. So just hang in there and finish."

Rasmussen: "Great. Thank you so much, Nicole. It was great to visit with you."

Wilson: "Thank you."