You recall the days of telling customers: “You can have price, quality or service, pick two?” Customers want it all. Quite frankly, they are entitled to make this demand. As sellers, we should be committed to delivering on their demands.
While not compromising on price.
Last week, I attended the SAE 2013 World Congress exhibition in Detroit as well as several networking events affiliated with the meetings. I spoke with manufacturing companies and engineering entrepreneurs about the state of their businesses, their competitive marketplaces, the place of innovation in their company culture, and whether selling and engineering continue to live in separate corporate silos.
For those of you who feel that spending 4+ hours a day with engineers is right up there with root canal, you are missing out on some of your most interesting, and demanding, prospective customers. For those of you who live in this space, as I have for my entire career, it’s been a roller coaster of a ride – especially since 2008.
The good news is that companies, the ones having robust yet flexible business models who manage their assets well, are choosing to walk away from the table if customers are forcing them to cave in on price. That’s a different story than the one I was hearing in 2004-2008.
They are choosing to do business with customers who appreciate the value they bring to the business table based on the quality of deliverables at the price negotiated. They are not indiscriminately flailing away at the marketplace, trying to be all things to all people – at the cheapest price. They are not caving on price or letting the selling discussion boil down to price as the rate-limiting variable in contract negotiation.
They’ve strategically opted to draw their professional line in the business sand and walk away from the table if customers want to play hardball with them on price. Even the folks selling what most of us would term as commodity products and services.
Instead, they’ve diversified the industry segments into which their products and services are offered. Instead they’ve fostered a culture of innovation into what had been a lack-luster, one or two trick pony of a business. Instead, they are offering more. For more.
It’s not a pick-two marketplace anymore. It should never have been a haggle about price, anyway.
These engineering-based manufacturing companies are looking at the total impact their products, services, and platforms make on the cultural, economic, and strategic well-being of their customers. How does the cost of goods purchased translate into their customers’ value over the lifetime of using their product, services or equipment – whether consumable or durable?
They are talking value with their customers. That type of value proposition resounds with why negotiating with them on price shouldn’t be part of the equation.
They are talking collaboration with their customers. You can’t gather data that validate those types of selling value propositions unless you have customers willing to partner with your company and share their own outcomes with you.
They are serving their customers across the board, instead of positioning themselves as a one-product, one-niche supplier. They have that 10,000 foot eagle’s eye view of the industry landscape that allows them to provide far more than products and machinery. They are strategic partners integrated into their customers’ corporate culture.
Something to think about moving forward into 2013. What has your experience been?
Babette N. Ten Haken, Founder & President of Sales Aerobics for Engineers, LLC, brings entrepreneurial mojo back into small and mid-sized businesses, particularly in the manufacturing sector. She builds vibrant revenue-producing business strategies for technical start-ups seeking investors and early customers.