INDUSTRIAL DISTRIBUTION: PROJECT YOUR MARGINS IN A DOWN ECONOMY
Industrial Distribution’s Rafe VanDenBerg outlines how to project margins, even in a down economy. He says, “Price optimization technology can help your salespeople hold the line on pricing, retaining your company’s precious margin dollars.”
Industrial Distribution Excerpt:
Here is a fun after-lunch exercise: grab your nearest salesperson and dissect him on the spot. What do you think you will find under that polished exterior? What lies beneath all that confidence, training and customer knowledge?
The hope is to discover they are made of titanium or some other super-alloy that has been reverse-engineered from alien crash-sites. After all, the world is in the midst of a brutal economic downturn. Demand has taken a nosedive and sales volumes have tanked. B2B distribution companies need every penny of revenue and margin they can get their hands on.
Salespeople must be able to close the deal by not giving up too much in price negotiations. In an economic downturn, heightened fears and concerns over losing the deal or alienating the customer tend to dominate the pricing process. When fear sneaks into a salesperson’s pricing decisions, the result is predictable: margin dollars you cannot afford to lose are left on the table.
So how do B2B distributors guard against these behaviors that can cause so much damage? How can salespeople ensure they are going far enough to win the business without causing unwarranted damage to the bottom line?