There are eight levels of value-added selling, each one is more sophisticated than the one before. Some of the more advanced levels seem to contradict earlier ones. This is one of those seeming contradictions. As we move into Level V of value-added selling, we see that the reasons customers buy from us are more complex than we thought. How many of your customers have bought your products, placed them on a pedestal and displayed them in the lobby of their building?
How many of your clients have bought your services so they could advertise to their customers that they use your service?
The answer to either of these questions is probably none or very few.
So why do customers buy from us?
In a previous Myth I said that the reason customers buy our products and services is driven by what they
think our product or service can do for them
right now. Not what it did for someone else or what it did for them in the past, what it can do to help them meet their objectives right now.
Take It To The Next Level Level V of value-added selling is known as Supply Chain Selling. At this level we don't sell to, we sell through. We look at our customer's customer and determine how we can help our customer sell more to
their customers. After all, when our customers are selling more, they need to buy more from us, right?
With this in mind, customers buy from us based on what they think our product or service will help them do for their customers.
Got it?
Here's a real-world example that will help clarify it. An office furniture company was allowed to compete for a sizable contract. A major business was looking to replace all of their office furniture over an extended period, one department at a time. As you might imagine, some of this office furniture companies would submit very competitive (ok,
LOW!) bids for the first department so they would be front-runners for the subsequent jobs.
My client took a different approach. Instead of doing a simple departmental inventory (how many desks, chairs, tables, etc.) they did real pre-call planning. They looked at the client's business objectives, SWOT, clients, competitors, industry and anything else they could find. They looked at all of the departments, not just the first one.
When they sent in their proposal, it had two sections. One was exactly what the customer had requested: furniture-for-furniture swap. The other was an alternative proposal that addressed 1) how the departments could interact more efficiently with each other and, 2) how the client could better interact with their customers.
The proposal was that the managers of each department would have their workspaces in the center of the room with their direct reports closest to them. The people who had the most customer contact responsibility (now known as "customer facing") would have workstations most distant from the managers. This hub-and-spoke configuration meant that salespeople and customer service people would be on the outside of the circle, order entry would be next, followed by accounting services, administrative and then the managers.
As long as things were working well, the managers were free to do what they do best which is develop strategies and tactics. It would be easier and faster for the managers to collaborate with each other as well. Salespeople and customer service people were all close to each other where decisions and answers would happen quickly. Order entry personnel could get a quick response if they had questions. If there were problems, they worked their way towards the managers.
In their proposal, the office furniture salespeople were able to show how many man-hours would be saved internally - and they
quantified it! Then they showed their customer how the quick decisions and responses would impact their positioning in the market. This could not be quantified, but their customer got the picture.
Finally, they showed that implementing the rearrangement in all departments simultaneously would
create less disruption for the customer's customers. (It would also save money, but their focus was on what they could do for their customer's customer.) The icing on the cake was that they could do the entire project over a long holiday weekend that was coming up.
Their customer not only decided to buy from them, they also decided to drop the phased-in approach and convert all of the departments at one time. They even agreed to pay a premium for some items that would have to be rush-ordered and a partial premium for holiday labor charges.
What You Can Do You need to understand how your products or services help your customers better serve their customers. Then, you need to figure out what else you can do to help your customers better serve their customers. Here are the initial steps:
Once you understand who your customer's customers are and how you can help your customer serve them better, it's time for you to communicate that to your customer. How will you do that?
Whatever you decide, make sure your customers understand that you are there to help them sell more to their customers - and beyond.
DIY Idea
