3 ways to grow your business in the volatile North American timber markets
2018 has been a challenging time for those operating within the volatile timber markets. Navigating a way through the uncertainties of unit costs and industry demand whilst attempting to be a proactive, sustainable business remains incredibly difficult for most.
We have created a 3 step agenda for our brave forestry friends to provide a advice during this tough period. A few quick wins that can be used to boost your efforts and take back control over your business.
Develop a customer service focus
With a sense of resistance among buyers due to the uncertainty in price trends, how are you future-proofing your business?
Did you know that 45% of woodworking businesses plan to increase their investment in 2018 to tackle their market challenges? Their focus? Well, 4 of the top 6 areas for investment are related to sales processes and customer experience.
Your practical tips here are to talk to your customers!
Are you talking to them often enough? Do they know how hard you work for them? Have you told them about all your new products and company developments?
While you have been waiting for the phone to ring, your competitors have been calling, emailing and mailing your customers with how great they are – so don’t be shy to sing your own praises.
Don’t forget to ask your customers what they think you can do better – and do it often! Knowing what your customer wants can take them from being just satisfied in your service to making them an evangelist of your work who will spread the good word for you.
Celebrate your customers. By keeping in touch with them, you will be able to applaud their achievements. Importantly, doing this will show that you care about their success rather than just selling to them. Furthermore, it creates a strong bond and increases customer loyalty (it also feels good to be congratulating instead of pitching).
Master the upsell
With the markets in flux, making the most out of your loyal customers has never been more important. It has been shown that increasing customer retention rates by 5% increases profits by 25% to 95% (invespcro.com).
As highlighted in our blog, Your Customer Retentions Sucks. Here’s How To Fix It, spotting where you can sell more to your existing customers can go a long way to sure up your businesses finances in difficult times.
Are you in the 37% of companies willing to increase prices to keep your margins healthy or are you looking for smarter ways to serve your customers and save your precious profit margins?
Focus on service
Your new focus on service will bring invaluable information on your existing customer base. What you need to do is use this insight to sell more to your happy customers.
Let’s say that Johnson Builders buy softwood from your timber company. They have a steady average order year-on-year but haven’t ever purchased wood screws.
The margins you make on the softwood products is being squeezed but your screws have a healthy margin. Time to upsell!
The probability of selling to an existing customer is 60-70%
The probability of selling to a new prospect is 5-20%
Who do they currently buy screws from? How does your offer stack up against your competitors? Do they even know you sell screws?
If you have your communication channels open, you are much more likely to find out this information and be able to use this to tempt your customer into trying your range of screws. If successful, your customer will have a one-stop shop for their timber needs and feel as if they have been rewarded for their loyalty. Meanwhile, you will be increasing your market share and increasing the profit margin of your invoices.
Happy customer, happy bank balance and unhappy competitor.
Use the best tools
You wouldn’t fell a mighty redwood with a flick knife, so why would you try to run your business with manual reporting and basic spreadsheets?!
According to Woodworking Network, the majority of firms they surveyed cite increased computerization within their business as a key element of investment for 2018/19. The integration of new technology into the Lumber and Wood products industries ranges from heavy machinery to SaaS software for accounting, stock control and business services such as sales and customer service.
Whilst you can’t control the cost of raw materials, you can take control of your sales, margins and product development. This is where software investment comes into play.
Keeping your data safe, using your data to grow
The range of ERP, CRM and BI providers can be mind-boggling. That’s why we created a matrix that you can use to help you decide what is most important to your business (check it out here) and how each supplier compares to one another.
Niche products may require you to jump from system to system to check your invoicing, stock and sales calendars. Furthermore, some may allow you to buy features and build your own system with bolt-ons, but these may not have the same user experience which can slow your progress. Others, like sales-i, will combine features into one product to deliver a holistic approach to your data storage, analysis, and insight needs.
So there we have it. Three steps to sure up your business for these volatile times. Show your customers you love them, leverage that strong relationship to provide more of their product needs and get a grip on your internal data to gain insights that can save at-risk accounts and highlight upselling opportunities.
sales-i simplifies data analysis to give you pin-pointed accuracy to improve your sales performance. It provides an easy way to track sales and get pro-active alerts to your reps and management when customers spend patterns have changed. This means that you are alerted to at-risk accounts without having to search for this information.
Our Campaign functionality allows for specific targeting to help your sales team see opportunities to up-sell products to your low margin customers to stabilize and boost your company’s revenue.
Find out how sales-I can help your business and book a free demo today.
P.S Why not download our free whitepaper for more information – 7 Tips To Manage Growth In The Building Supplies Industry.