Are you providing true value to your customers? If so, do you have a process to capture and document it? Most importantly, do you have a process to present it to your customers? If you do not, then you are not retaining any value for your efforts.
In today’s business environment, companies are continuously evaluating their suppliers to make sure they are truly getting the lowest overall cost. Cost and price are two different issues. Price certainly is part of the equation but not the total equation.
We look at providing value and determining overall cost by evaluating several critical operating processes of any company. These areas are:
Asset-focused activities help your customer lower its asset costs. For example, when you provide just-in-time delivery, establishes a vendor-managed inventory program or provide storeroom management services, it helps your customer’s bottom line by reducing the amount of inventory (assets) that customer must keep on hand.
Expenditure-focused activities impact the price that a company pays for products and services. Product substitutions, price protection or rebate programs, reducing freight costs and volume purchase agreements are common examples of ways that can reduce your customer’s expenditures.
Process-focused activities help put in place new processes that lower costs. Examples include providing online or Internet ordering capability, establishing an onsite bar-coding system to track tool usage, utilizing electronic data interchange (EDI) or electronic funds transfer (EFT) to lower process costs.
Revenue-focused activities help customers generate more revenue. They can be as varied as identifying a new product or market for customers, suggesting a new process that enables a manufacturing customer to reduce turnaround time, increase output or get back on line more quickly.
Service-focused activities are services provided by you that help your customers lower costs. For example, you might provide 24-hours-a-day, 7-days-a week delivery service, engineering support, predictive maintenance, safety training, kitting/pre-assembly, tool repair or other valued services.
The real key to this, is not only doing the things that help your customers save money, but your process of capturing and presenting these savings to that customer.
We can help you implement a company wide program helping to make sure you never lose business to competitors who claim to provide the same services but for less money.
NEVER ALLOW PRICE TO DETERMINE IF YOU GET THE BUSINESS!