Do I Know What My Partners Want?
In many cases, small organic companies have evolved from
family-owned businesses or “friends with a purpose.” Now that
your business has grown past that stage, are your key stakeholders
in alignment?
For example, one company was being run by two men, let’s call them “Tom”
and “Joe.” They were at the point where decisions needed to be made about next
steps in the business—a three-year plan, perhaps. When asked, “Where do you see
this company in five or ten years?” Tom said, “I want to build this business to leave
to my children in 10 years,” and Joe said, “I want to sell it and retire in five years.”
This disconnect impacts every decision these two leaders make—what systems or
technology they put in place, what new channels they do or don’t consider entering, what capital expenditures they undertake, etc.
If your key stakeholders are not on the same
page with where the company is going, it will
be very difficult to be a thriving successful
company in the year 2020. Have this conversation sooner rather than later to determine where to go from here.
1.
Do I REALLY Know
My Market?
Knowing your market is as
important as knowing your
management team’s innermost
thoughts. You may be extremely passionate
about your product and its attributes but do
you know what your customers think? Are
you involved in the right channels to keep
your business growing for three or five or 10
years? What does your competition do better
than you?
Here are four tips on how to educate
yourself about your customers and
how they think, what the competition is doing and how to better serve your
customer base.
1. Do an 80/20 analysis. If you’ve never done an analysis of your customer base, it
may be quite enlightening to figure out which of your customers bring in 80
percent of your sales. Take it a step further and figure out which of these customers are among your most profitable. Once you understand these metrics, it
will be much easier to make educated decisions about channel development,
customer interactions and product development plans. For example, after an
ingredients company found that 10 percent of its customers were responsible
for more than 80 percent of business it immediately set out to “fire” several
non-core customers (which meant moving them to a distributor that could better service their needs). This limited risk and allowed the company to focus
more on its top customers.
2. Talk to your customers. Now that you know who your best customers are, call
them—personally—to set up a meeting. Then go there, take them out for
lunch and LISTEN. Ask them questions about their business and future direc-
2. “Know your customer’s
customer. If you’re a
manufacturer selling to
retailers, go dazzle them
with details about what
the consumer is thinking.”
tion, what your competitors do better than you and what you could be
doing to make their lives easier.
Next time you go in for a sales
call, try asking questions for the first
15 minutes. The insights you discover could completely change the
direction of your sales pitch, and
make it much more successful. During a sales call one client was asked,
“What is most important to your
customers?” The client said that his
company catered to the “price” customer and getting the lowest price
was the most important thing to
him. But the item on the table was a
premium product so there was a
disconnect. To compromise, the
marketing-intensive sales pitch was
thrown out and instead the sales
person negotiated the lowest possible price, with the caveat that there
would be no marketing or in-store
sales support. In the end, everyone
was happy. This won’t work with
every customer, but the point is, unless you ask the customer what’s important—and truly listen to the
answer—you are not maximizing
your company’s customer relationships.
3. Know your customer’s customer. If
you’re a manufacturer selling to retailers, go dazzle them with details
about what the consumer is thinking. Peruse trade magazines, read
company websites, buy data from
organizations like SPINS or the
Hartman Group and educate your
customers. They will love it if you
can advise them on how to get
closer to their consumers.
4. While you’re at it, make sure you
know what your competition is
doing. Sign up for Google Alerts
and include major competitor company names and product names so
you’ll know immediately when they
do something newsworthy. Appoint
a “competition czar” within your or-
