5 tips for managing customer partnerships and growing revenue
With distribution channels consolidating at such a rapid rate, maintaining fewer, larger customer partnerships is essential.
In an $8.7 trillion wholesale distribution industry with ongoing supply chain challenges, it’s essential that distributors have enough of the right customer partnerships to weather the storm and keep their already thin margins from shrinking further.
We all know that 20% of customer partnerships generate 80% of revenue; however, ensuring that those “vital few” partnerships are protected while also nurturing newly activated relationships is often easier said than done.
As a distributor, you can apply the following fundamentals to create dynamic customer partnerships built on loyalty and trust.
1. Digitalization – To compete with direct-to-consumer businesses like Amazon that are circumventing wholesale distributors, digitalization remains a top priority for those companies committed to maintaining and expanding customer partnerships.
Digitalization plays a key role in collaborative planning and monitoring customer interactions and sales transactions while also helping to augment operations, curtail revenue leakage, optimize revenue, and slash logistics costs.
More data-driven engagement will help you keep pace with customers’ ever-changing business needs and challenges by enhancing customer experience, saving you time and money, and creating stronger, more long-term relationships. Having direct access to detailed, configurable, and real-time data on stock, previous order history, and ordering patterns helps you exceed customer expectations in the areas of accounts receivable management, logistics, and service.
2. Open, consistent communication – Treating your customer partners as extensions of your own team by consistently communicating and collaborating on how to best serve their customers, overcome obstacles, and achieve better outcomes helps add value to their business and will, in turn, add value to your business.
Regular check-ins will help identify the best course of action to resolve issues related to contracts, sales, or service before things get worse.
3. Keeping it simple – Your customer partners are looking for simple, seamless and user-friendly experiences and place a high value on agility and flexibility—especially when it comes to processes and solutions that make it easier to purchase goods and improve customer service.
Helping your customer partners do their jobs with fewer complexities will increase the likelihood of a long-term partnership.
4. Setting a higher bar for service – While most customers don’t complain, even when they are extremely dissatisfied, the faster you’re able to fix a customer’s problem, the greater the likelihood that they’ll continue working with you.
Neglecting customer service can cost the average business up to 20% of its customers each year. It can cost up to 10 times more to attract and secure a new customer than to keep an existing customer.
Establishing and maintaining a customer-centric mindset that improves the customer experience at every touchpoint, pre- and post-sale, can put your business ahead of your competition. Happy customers tell other potential customers how great it is to do business with you.
- Hire and train the right people—and ensure every one of your employees is committed to exceptional customer service.
- Consistently deliver on time, every time.
- Strive for perfection and quality.
- Always go above and beyond.
5. Adding some extra TLC – Smaller customer partners may require a little extra tender loving care to stay in business. This requires doing more than offering a fair price and timely delivery—it requires a personal touch.
Do more than tell your customers they are appreciated, show them they are appreciated by sweating the small stuff and taking proactive, value-added steps to nurture the relationship.
- Share strategies to expand target markets and increase sales and revenue.
- Provide special discounts and relevant offers, free delivery, or complimentary items and services.
- Offer incentives for repeat business and referrals.
Faced with emerging technologies and rising consumer expectations, you need to embrace a more customer-centric outlook. Deeper, more strategic and mutually beneficial partnerships that place greater emphasis on accountability, agility, and transparency will lead to increased differentiation, growth, productivity, and profitability.
3 key questions
Have you taken a data-driven approach to protect your revenue streams, deepen existing customer partnerships and accelerate your business during these uncertain times?
Are you doing everything you can to ensure your consumers come first in all that you do?
Are you creating growth opportunities for the remaining 80% of your customer partners?