Articles - Retaining Business In Difficult Times

Times are tough and for many organisations it's a constant struggle to remain competitive even when times were good. So hanging onto business now the hard times have arrived is a major challenge.

With margins already tight it's difficult to see how prices can be cut further.

Winning new business is also more difficult as markets contract, so hanging onto the business we already have is top priority for most of us.

So what can we do to keep our customers?

· Expect and plan for price pressure

If it hasn't happened already, it's very likely that your customers will ask for price concessions, so consider now what you may need to do to mitigate damage to your margins.

For example, are there ways to find mutual cost savings through changes in specification, design, processes or delivery? Now is a good time to explore every aspect to see if there are any innovative solutions lying undiscovered.

If you can be proactive in helping your customers to save money they are much more likely to value the relationship, so constantly look for any areas where you can add value.

If you know you are going to be faced with requests to cut prices, start planning your strategy in the up coming negotiation. Remember that blanket discounts have long-term implications so look for 'one-offs' where you can make concessions. Above all, trade the price concessions you make for things of value to you, such as earlier payment or perhaps a greater slice of the customer's business.

· Deliver excellent service

Research from a range of sources shows that while price is an issue it is rarely the determining factor in a customer's decision to change suppliers. Dissatisfaction with the supplier is a more likely cause. Few customers are willing to continue to pay a premium price for average performance.

All too often customers are happy with the seller but unhappy with the organisation, or happy with the product but not with the service. To keep business in hard times it's essential that every element of customer contact meets or exceeds the client's expectations, all the way through from the behaviour of the operator who takes an enquiry to that of the truck driver who delivers.

· Maintain and develop your customer contacts

Putting pressure on suppliers isn't the only thing customers do when times get tough... they may also reduce their staffing levels! Your closest contacts in the account might just become victims, leaving you vulnerable.

So spread your net as wide as possible and try to make sure you keep high level contacts. This way, you know about future opportunities inside the account rather than becoming a victim yourself.

Make sure your key contacts understand the value you and your organisation bring to their business, otherwise they will have few reasons for retaining you.

By Barry Hazelwood