Working smarter to plan increased turnover without needing new business
Content provided by a guest contributor.
Most businesses would like to increase their turnover, but often struggle to do so. One reason is that businesses simply set a growth target with no focus on where that growth should come from, or why people would buy more from the company.
Increasing turnover means more sales to existing customers, more new customers or higher prices, and for now I will focus on growing existing customers.
Selling more by being a great supplier
Before you even start to think about selling more to customers, you have to examine if you really understand your customer’s goals, plans, needs and likes, and if the communication channels are open at the right levels.
If you are dealing only with a junior buyer who gripes continually about your quality, prices and service don’t expect any of the stuff below to work. Start again and build a relationship of understanding their culture, needs and systems. Then deliver what meets those requirements.
Get the communication channels working effectively at the right levels and address their concerns promptly. Then you can think about growing your business with them. But if you are already there with your customers, you have some choices. You can:
1. Sell products the customer did not buy before
To do this you need to uncover additional wants and needs that can be satisfied by more products. In almost every customer supplier relationship there are knowledge gaps, information about products and services that the vendor thinks he has told the customer about, but the customer has either forgotten or never known.
The reverse is also true. Information about the customer will have missing or forgotten pieces. Talk to the customer about this. In fact, always be talking to customers about this.
To develop it further do a gap analysis – a matrix of all product ranges compared to the customer’s actual purchases to identify which products or ranges the customer is not buying, but could be buying. Then talk to the customer to find out why he is not buying, and fix that if it is fixable.
Do this for all your customers, but beware, this is often a scary exercise. A matrix with products on one axis and customers on another usually shows an uncomfortably large number of blank spaces, each one representing a possible sales opportunity. Then start to fill the blanks.
2. Sell more of the same products to the customer
There are two opportunities here. You can help your customer to grow, especially if he is a reseller of your products. Alternatively you can increase your share of the customers spend where there are multiple suppliers of the products you sell. This means good old fashioned competitive positioning, improving quality, offering better service or lower cost of ownership or having better salespeople.
I suggest you do not try to be manipulative. Filling a customer’s store room with goods he does not want could help with quarterly targets, but will alienate the customer.
3. Get new products that the customers need
So the word ‘need’, comes up again. A really simple way of increasing sales is to find a product or range that lots of your customers need, but either cannot get or are unhappy with the supplier they use.
You find out this by being in good communicat,ion, understanding their business and all that good stuff, so don’t bother to ask the grumpy buyer. He or she will just use you to wring price concessions out of his existing supplier.
But if you are in a good supplier – customer relationship then you should always ask for what products or services he or she is not getting satisfactorily. If the same product or range is needed by several customers there is usually a good opportunity to displace a poor supplier. It is probably not a good idea to just try to get a product for him cheaper. If he is prepared to switch suppliers on price he will desert you for the same reason one day.
There are other ways of increasing business to existing customers, but the three basic techniques above should provide most businesses with planned growth opportunities. Try them out and let me know how they worked out.
Article written by Ed Hatton. Ed is a mentor and consultant to start ups and existing companies and has operated for many years with a high level of success assisting businesses to grow and prosper. His focus is on strategy, marketing and sales to generate competitive advantage. Find more information here or send Ed an e-mail