What can you do as an entrepreneur to double your turnover without freeing up extra capacity? During the ICT & Logistics trade fair, Karen van Riel and Martine Teeselink of marketing agency Outdo described three game changers that can help logistics companies boost their turnover.
Outdo guides entrepreneurs in the manufacturing and engineering industry who want to grow. The standard strategies like 'sell more' and 'work harder' mainly manifest themselves in a full agenda and an arms race with competitors, according to Outdo's owners. Van Riel and Teeselink therefore recommend three completely different game changers to ensure a major breakthrough.
1.Selective selling
In selective selling, you basically close the door to customers instead of opening it. That sounds rather unconventional for entrepreneurs, Karen van Riel acknowledged during the seminar. "I understand that hardly anyone does it. One of the main reasons for this is that as people, we want to be sympathetic. Your natural reaction to a customer's request is that you want to help the person. But what can it get you if you don't? Everything."
Van Riel argues that almost all companies have at least one customer that generates only a small percentage of turnover, but eats up a large part of labour hours. "Take a look at your current customer base and examine who your best and your worst customers are. Then it will be easier to recognise and select them after that. Write your future door policy on a white sheet and hang it in plain sight. If you come across customers who don't pass that door policy, respectfully refer them to someone else who can do it better."
"Should you also say 'no' to your worst current customers?", people asked from the audience. As long as it is done respectfully and you refer them to other companies, it is not a problem, van Riel replied. "They probably also benefit from a company that can help them better."
2. Raising prices
Another unpopular measure: raise prices. Martine Teeselink: "If you have a fixed capacity, then that is the only thing you can do." Teeselink does not advise companies to suddenly become 20 per cent more expensive. That could backfire. "Instead, choose to make one of your best products more expensive. A previous client of ours sold measuring equipment. It already knew which product was of great value to its business. That product cost a few thousand euros. Customers never complained about that. They immediately agreed to the offer. There are opportunities there to increase the price."
"People associate price with quality," Teeselink continued. "If one company is more expensive than the other, the customer thinks: 'There must be a difference between the two'. Who will look for that difference. And you can capitalise on that."
3.Talk about your customer's problems instead of your product
Most companies that have a product to sell tell potential customers about that product: 'I have software and it's really good'. "But the customer doesn't want to hear that. Who wants to talk about the transformation from an ordinary entrepreneur to a very good entrepreneur," says Teeselink. "If you manage to capitalise on that, then you are going to make a difference. Customers then feel that you understand them."
How do you do that? By asking questions. As an example, Teeselink mentions a salesman in logistics. He visited customers with a catalogue. Spoke there about warehouse equipment etcetera and left again. One in four customers went with him. The rest went to competitors. "He changed his approach. From now on, he would walk through the warehouse with the customer and ask: 'What would the warehouse look like if things ran smoothly here? What would that mean to you?' Then you get to the real value. Then you can start selling products that are more expensive because the customer sees that it gives him something. So always ask your customer what he wants most of all."