Building a Future for Distributors and Dealers of Building Products
Volume 44, Issue 5 June 2005
Advice for Your Business
What Will 2005 Hold
A Difficult Time Without A Team Approach
by Art Ramey
There are a lot of good signs out there for housing—both new construction and remodeling—and there are some interesting challenges.
High energy prices at the gas pump and in home heating have hit consumers’ pocketbooks and reduced their disposable income. In 2004, plastics and steel escalated in price rapidly. Freight costs are up, and property taxes as well. The industry margins are reduced, even after passing along a portion of these increases.
Marketing and selling in a fast-moving environment can be difficult. Now picture what it is like when the market dynamics around the industry have just changed. The people who support the theory that business life will revert back to old costs and marketing practices the way it used to be are in for a disappointment of long tenure.
The way we all win in this game is to complete on-going sales.
Manufacturers, retailers, builders and installers need to learn how to work together as a team while bringing the same value statement message to the end-user: These products are worth more because they do better things and provide more long-term advantages, especially products made of polymer or plastics. No other materials offer more versatility and a stronger long-term positioning story.
If this sounds like “team selling”—that’s because it is. It’s important to make sure the group gets the message all the way through the distribution channels to the final customer, and to make sure that the customer writing the check feels good that the extra initial cost of the product purchased will in the long-term give pride of ownership, with features, benefits and aesthetics that provide satisfying value today, tomorrow and for many tomorrows to come.
Focus for the Future
We are now and will in the future have to “customer focus” more on the following:
1. What does the customer want and need? How do we use the input information, what we have been told and not told, to develop what is needed? We need to re-orient our thought process more to the customer’s. As a team, everyone in the channel needs a process for getting unfiltered information to the manufacturer who is getting ready to spend millions in the development process. This will help to build-in salability before the products are brought to market and the development money is spent.
2. Give customers choices and options. Critical judgment is what is really needed here rather than overwhelming the customer with too much stuff and creating confusion.
3. Be responsive with communicating information—the clock is ticking. The older the information, the greater chance of missing the development process and sales opportunities.
4. Focus on specialty or niche products where design can give the customer more productive results and the market channels are a step up in profit.
5. A sense of urgency is critical. Price quotes, tooling, order completion dates, advertising awareness and launch dates are all important for achieving a successful introduction strategy.
6. Get out of the habit of worrying about competitors—obsolete them. Work as a team in each phase of the channel to prioritize the market and what customers’ say their needs, wants and desires are, and their unspoken problems/opportunities.
Many times you will see something that will help the customer discover what they missed. When everyone in the market channel brings their experiences together, great things are accomplished. Remember, “Customers support what they help create.”
7. Don’t let “project creep” distract you mid-way through the team effort. Distractions happen when the newness wears off—everyone needs an assignment and accountability, just like with a football or basketball team. Some players are great shooters or passers, others are runners and dribblers. Everybody contributes!
8. Focus on the future. This will help the team to feel good about the potential.
9. Together develop five or six key presenting points to drive to the end-user, as well as a brief comparative analysis.
10. Many times people believe what they can feel (emotionally or physically); overloading the presentation with words will lose their concentration.
11. Can the key points of number 9 and 10 be coupled together? We all have to justify price for the homeowner, but price compared to what? Low-maintenance and no-replacement products are worth more because they do more—isn’t that the real message?
Art Ramey is the executive vice president of sales, marketing and distribution of Royal Mouldings of Marion, Va.
© Copyright Key Communications Inc. All rights reserved. No reproduction of any type without expressed written permission.