Numerous surveys points toward the fact that the end user prefers quality over price. As B2B supplier, you can boost your business model significantly, if you focus on the...
B2B – business to business – covers trade between companies. Contrary to the trade between company and consumer (B2C), for most entering such a relationship, the goal is to deliver the most optimal solutions to the ones who, in the end, have to resell to a given end user. For example, if you are work at the dairy company Thiese, you will have to deliver your product to the supermarket chain Coop, where I – as the consumer – eventually will buy my milk. A seemingly simple relationship in a seemingly short value chain. However, the problem is that the chain for a B2B company is far from that short in reality – your sales effort will have to continue all the way up until the time the consumer drinks your milk and is happy about it. The code for success? Close collaboration with you B2B customer with the purpose of creating products and services with a customer-centric perspective.
Most people already learn the value of collaboration as kids – in the home you have your chores contributing to the daily maintenance of the house, and when playing soccer, you will not win if you do not pass the ball. Likewise, most companies have learned the value of enhancing co-work within their organization. But when it comes to supplier collaboration, I experience a completely different story, resulting in customers not understanding why the milk all of a sudden taste different or – worst case scenario – them not buying your milk at all. And then, the customer is lost both for the supplier and the company selling their product.
The gold lies at the end of the value chain
Several surveys tell me, that I am not alone in the perception that the gap between the expectations of the customer and the (lack of) collaboration between supplier and company is wide open. A recent study about supplier collaboration even shows that although over a third of the respondents said they were collaborating with their suppliers, less than 10% could actually demonstrate this in reality – and that the ones who did collaborate with a shared focus on the end user experienced a growth twice as big as their competitors.
It goes without saying that you – as a supplier – will experience the biggest success if you rethink the character of your strategic work with your supplier and in unity creates products, which people want to buy. Seeing the value chain as an organism working together towards a shared goal. And it is without a doubt what suppliers ultimately should strive for – but simpler towards the aim of being the perfect supplier can also do a lot. Here are 3 simple steps which I have learned works:
- Identify your customer’s customers. Who are they? What do they accentuate when buying the end products which you as a supplier contribute to? And what do they accentuate when buying similar products? How should you communicated with them both visually and written in order to get their attention? At this step, we have experienced that personas and customer journeys are very helpful.
- Define what you can change about your partial delivery in order to perfect the end product. Take your data, which you – for example – could be gathered through a survey amongst the end users, and see where there are room for improvement – maybe you will experience increased sales if you change the colour of your delivery from green to red.
- Adjust your products and send them to market. The faster you can test your ideas, the faster you can pull them back and adjust them accordingly based in the feedback you get. Remember to be transparent when it comes to explaining your choices to the company which is to sell your product – in the end, they are the ones selling your milk, hence they need to be properly equipped for this.
The abovementioned simple steps do not take a lot of money or hours of dedicated work before you will see results. When you – and your colleagues – experience success, you can start thinking of doing an even closer collaboration with the company. Here, you can get inspired by e.g. IBM, who has had great success with their Customer Lab, in which IBM Research scientists and business consultants will co-create with clients to deliver systems that learn and personalize the experiences of each individual customer, identify patterns, preferences and create context from big data and drive scale economics. Or you could look at Ford who recently announced that they, by sharing more than 350 best practice experiences with their suppliers, is on track to save 550 million gallons of water and cut carbon emissions by 500,000 metric tons over the next five years.
In New Sales by Innovation Lab, we have great experience with enhancing sales at supplier companies by analyzing their customer’s customers through a simple model. If you are interested in knowing more about how we do this – or if you are interested in learning how the model can be used in your organization – do not hesitate in contacting me at email@example.com. I am more than happy to share my personal best practice experiences when it comes to being the perfect (customer centric) supplier – so you can avoid angry customers and bad milk!