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If you think competition has been stiff during this decade, hold on, because it could get even more exciting. While a few giant online sellers have grabbed business headlines and a lot of sales revenue, their smaller rivals have not been completely asleep. These rivals are often matching marketing techniques and have some sharp ideas of their own.
While some firms are drifting toward “sell everything through technology” strategies, others are remembering that business customers often want more than just a brief description of products that might satisfy their needs. Some firms are remembering that people (i.e., their business customers) have a buying agenda that is based on business requirements and on supplier attributes. It pays for all firms to pause and reflect on the attributes that will be most relevant going forward.
So, what are supplier attributes and which will business customers value most?
Simply put, a supplier attribute is a quality or characteristic that is used by business customers to measure and value suppliers. Ask any business customer to list important attributes and most will answer “service” first. The other attributes on the list will vary but likely will include some of the following:
Since time is always the irreplaceable resource, most business customers look for high velocity throughout their transaction process. From need recognition to product application to order processing and delivery to payment, business customers want it fast or at least within the required time period. The time allowed depends on customer needs and the criticality of the application. In no case do business customers appreciate the waste of time, since it represents unnecessary costs, business disruptions and employee frustration. You can make a difference when you get the job done fast.
Although quality is often in the eye of the beholder, most business customers think of supplier quality in at least two major areas but always with the underlying question: Did I get what I needed?
Product quality relates to the form and fit of supplier products for particular applications. Business customers may ask many questions, including:
Process quality relates to the overall buying experience and is often equated in customer minds with service. It may be both tangible and intangible and is usually evaluated with such sub-attributes as reliability, accuracy and predictability, among others. It is almost always evaluated against the business customer’s perception of the supplier’s service promise. In addition, supplier process quality is almost always used in comparing competing suppliers.
This is the attribute that describes the overall ease of doing business with a supplier. Convenience means less effort and less time to complete a transaction. It can be measured but is often an intangible that is a state of mind created by numerous experiences. Creation of customer sentiments like “they are just so hard to do business with” must be avoided. Culture, process redesign and continuing review can make convenience a reality.
This is maybe the hardest attribute for business customers and suppliers to agree upon. Unfortunately, low price is easily identified by business customers and is frequently the attribute that carries the most weight. Savvy business customers, however, realize that price is just one component of total cost and savvy suppliers may try to help business customers measure the total life-cycle costs of purchases. Although more difficult to measure, life-cycle costs are far more important. Suppliers who deliver quantifiable low total costs to smart buyers are highly valued.
Processes and products that can be readily tailored to meet changing customer requirements exhibit the flexibility attribute, which can be very valuable to business customers in a changing environment. Often firms with large scale have difficulty with flexibility compared to their smaller rivals, who can turn on a dime when necessary. Standard processes lower costs while flexible processes may be more useful to business customers.
Technical Problem Solving
As products and systems grow more complex and solutions more elusive, huge attribute opportunities arise for technical sellers and problem solvers. Sellers of technical products can have a natural advantage over many rival sellers when they are proven experts at product application and problem solving. The advantage increases when solutions are required that combine multiple product technologies. Sadly, however, the best technical problem solvers are often not the best at telling their story about this potentially valuable attribute.
Many business customers still value the personal touch attribute. They like to buy from people if the experience is rewarding. Great sales people are still in high demand since they have the capabilities of asking questions, listening, analyzing problems that business customers present and recommending solutions. An increasing number of buyers likes to eliminate the human interface but often don’t like the results they get when operating solo, especially for technical products.
I still use a travel agent even though I know how to buy tickets online. My travel agent is smarter than I am about travel and has saved me hours of frustration and my clients hundreds of dollars. When the airlines’ phone lines are jammed, hers are open. It costs a little more but saves much more.
These may include a multitude of qualities that business customers require and value. Among these are continuing support, safety, environmental image, proximity, special services, size, and documentation.
How do you decide which attributes are most important?
You might say they are all important – and that’s a very fair statement. However, it may be difficult to concentrate on delivering all those attributes with equal emphasis, especially if you want to stay in business. So how do you decide on your attribute strategy and how do you prioritize your resource allocation?
First, be sure you talk with and observe what your business customers are saying about future requirements and track what they are doing now along with what attributes competitors are successfully touting. Think about these attributes and list them. From this list, put each important attribute on individual index cards. Put these in order (rank), starting with most important down through least important. Allocate weights to each of these (out of 100 total possible points) and you will soon see what you should concentrate on. You can also ask your business customers to do this. The results can be revealing and helpful in positioning your company for relevancy in the future.
Once you figure out your valuable attribute position, be certain to effectively tell your story and deliver the value. It means everything!
Best of luck!
Dr. Bill McCleave, PE is an industry researcher and consultant who specializes in Supply Chain Innovations for manufacturers, distributors and their customers. He has more than 40 years of experience in the distribution industry. Bill is also an accomplished vintage automobile restorer with many national awards to his credit. He may be reached for additional information at 704-232-6858.