07 Sep What’s your rebuild strategy – same old or something new?
The devastation caused by the impact of the pandemic on our much-loved industry is all too apparent. Those responsible for running trade and distributor businesses have had to make mass redundancies, possibly their hardest ever decision. Some of those made redundant may have played an important role in past successes of the company and for many, it is the end of not just a job but a way of life, almost like a divorce. I truly sympathise with the challenges they now face and let us hope it will not be too long before they find new opportunities either back in our industry or elsewhere.
For owners of distributor businesses, now is a time for decisions. Should one carry on doing things exactly as before or make changes as a result of what has happened? Some owners of larger distributors have decided to roll up their sleeves and get back to selling. After all, when a crisis hits, it is all about whatever is necessary, and for some it may be an opportunity to reconnect with their true passion of selling rather than just managing. For smaller distributors the choices may be more limited. With furlough and subsequent redundancies, more tasks have to be completed by business owners. In such cases, the difficulties of weighing up which tasks are a priority and the associated time it takes to complete them can be challenging, soul-destroying and stressful, and for some there is a need to work harder than ever simply to keep their business afloat.
The mindset is usually one of survival as our ‘Survival Brain’ takes over in a crisis and becomes our primary focus. This may be out of necessity rather than choice, but at some stage, a decision will have to be made about how not just to survive but grow the business in an ever more aggressive environment. Without creating the opportunity to focus on marketing and selling and innovation, this will stay a distant dream.
To succeed you may have to first change your mindset from survival to growth. Our mindset or psychology – the belief in what we can achieve – determines whether we can move forward or not, even before we decide on the right strategy. Things may never get back to the way they were before COVID so our mindset may have to change and adapt to the new ‘normal’. For business owners this will depend on whether we make the right choices as to what and how things will be tackled in future.
Most distributors enjoyed a profitable year in 2019. This may have been due to the ‘jet stream’ of prosperity which carried them forward last year, rather than because they were good at doing business, or were strategic or growth-minded. In March, or even earlier, some distributors had the foresight to join a new ‘jet stream’ of selling Personal Protection Equipment (PPE), or did so in response to customer demand. For some, this turned out to be very profitable and exciting as the demand for promotional products fell off a cliff. Those who were most successful were innovative and capitalised on the opportunity before others realised what to do or how to do it. Now that the PPE market has settled down, it is time to review the business the distributor knows best. Now is the time to prepare for the challenges and opportunities ahead and focus on a new strategy, a growth-minded strategy that will help capture or ethically ‘steal’ 15% to 20% of the best buyers from other distributors who either have no strategy or are no longer around. Of course, you can only achieve this if you have the time to market and sell to existing customers and new prospects with fresh, innovative ideas to solve their marketing needs.
Recently a trade supplier told me that distributors are now worried that they will lose key customers that they have come to rely on because their contacts have been made redundant. It is a known fact in our industry that one of the main barriers to acquiring new customers is the difficulty of persuading a new prospect to work with you rather than an incumbent distributor who may be well entrenched because of the personal friendship forged over years. Well, this new landscape will provide rich pickings for those who are agile, innovative, creative and persistent. All these characteristics can only come from someone with the right mindset and a growth strategy, to attract new prospects and persuade them to do business together.
Now is the time to build your product knowledge; to educate yourself on the latest products and branding techniques. Focusing on this will set you apart from the competition and provide your prospects with a compelling reason to do business with your company. There will be distributors, new or existing ones, who with the right mindset and strategy, will not try to just survive but will thrive. Now is the time!!!
By Paul Green, MD of Galpeg Limited – Providing Back Office Solutions to Distributors for over 10 years.