Ok, boys and girls out there in sales land, it’s story time again. Join me as we skip down the yellow-brick road – the one winding through the enchanted forests and nursery rhymes everywhere.
Off to your left just over the gingerbread fence, you’ll see the mansion of those Grim Brothers. Down on your right lays the cottage of Mother Goose. And directly behind the little hill you can almost make out the Giant Shoe once occupied by the lady with all those kids. It’s a magic moment, but somehow the story has gone awry.
Let’s cut to the chase. Remember the fabled Goose who laid the Golden Eggs? Too many India Pale Ales last night? A tough day at the office? Let me refresh you.
A poor wood-chopper and his family are about to lose the family house (and this was well before the sub-prime fiasco). When everything appeared to be gloom and doom, the family pet decides to chip in by laying 24-karat solid gold eggs. And, at something like 20 ounces each, these things turned out to be the best thing to happen in wood-chopping since Jack found those magic beans. I mean this goose was cranking out eggs worth 25 grand a pop.
Everything was hunky dory until the wood-chopper married a gal who worked in procurement down at the local castle. One of the best consultants in the industry had trained her to haggle and she routinely applied these principles to her home life. The butcher, the baker and the candlestick guy all knew that she drove a hard bargain. And now she was connected with the richest wood-chopper in all Storybook land.
She enjoyed the money and fame those eggs brought, but she wanted just a bit more. In meeting after meeting with the goose, she insisted on bigger eggs, more eggs, and she wanted it all for “chicken feed.” The goose worked harder and longer, but every improvement in eggs resulted in more demands.
After cutting down the daily ration of chicken feed to the absolute minimum, this procurement-trained lady wanted more.
Now back to our wood-chopping friend. One night as he journeyed home, he noticed a wonderfully delicious smell lofting through the air. By the time he made it through the lovely picket gate and up the walk, his stomach was growling. He greeted his buying-blessed bride with a hardy hug and a “what’s for dinner?” Sheepishly, she grinned and announced, “Golden Goose Flambé.”
The moral of the story
Every good story time contains a moral. In this case, the moral of the story is simple. A goose can deliver golden eggs on a regular basis, but you need to feed and care for the goose along the way. And a seemingly fat goose makes for a great meal – once.
For those of us in sales, the moral is pretty similar. As knowledge-based sellers in the distribution business, we can provide value to customers on a regular basis – forever (almost). But if the customer chooses to eat the golden goose, the value we provide goes away.
How does this happen? Well, generally, it’s a slow boil. Here are some tasty aperitifs to whet your appetite:
· You provide the customer’s engineering team with hours of troubleshooting and expert advice for solving a nasty problem. But later, you discover purchasing “accidently” sent the order to a low-price competitor across town.
· The contractor likes you and offers you the great fortune of a second look. In this scenario, you get to provide world-class service for bozo-class pricing levels.
· The contractor buys complex and highly technical products from you but purchases the easy ones from a no-service guy with bargain-basement prices.
A Recipe for Joining the Un-Cooked
First, raise your right hand and repeat after me; I provide valuable service to my customers. If you believe this - I mean really, really believe … then proceed.
Service equates to value. And value has a 5,000-year-old system of measure. It’s called money. You need to understand that what you do creates a cash flow just like the goose’s golden eggs. And, just like the magical goose of our story, we sellers need feeding. Here’s the deal – feed us more, and we provide more value. Feed us less, and the golden goose goes away.
But first, you need to understand. Most of our customer contacts don’t really understand value. They understand technical things. They understand logistical things and zillions of other aspects of their business. But most don’t understand the financial picture of their business.
And you need to understand many buyer types are paid to “chip” you down on price. I know of one company where purchasing folks receive bonuses based on their ability to drive the unit price they pay down 7 percent per year. Off line, a couple of these fine folks (and they are nice people) told me they knew it costs their company additional money for maintenance, upkeep and processing – but hey, that’s somebody else’s budget. These purchasing department guys know you’re providing golden eggs daily. But they assume once they have completed their dining experience with you, they can just drop by the farm lot and find a chicken, pig or cow that lays golden eggs, too.
You need to measure and log your value message for posterity. You need to take to the right people at your customer’s business. You need to share it with future customers. You need to broadcast it to prospects. And remember – this message must go to the right person - the one who understands the financial impact.
Mom’s Apple Pie and the Girl Next Door
I believe it is our duty to promote and protect the value we provide. A great many of my clients measure their value and find that they deliver a value much greater than the price of their product.
Here’s a quick example. One automation solution provider suggested the addition of a color sensor to their customer’s final assembly. That $240 sensor saved the customer more than 40 thousand dollars each year. And while that payback was large and immediate, it’s not all that uncommon for knowledge-based organizations to regularly provide value greater than the value of the products they sell.
It becomes our responsibility to help our customers harness this value. And, returning back to the Golden Goose story, we need to run like heck when we see the wood-chopper’s wife carrying the recipe for Roast Goose.Frank Hurtte provides Strategic Insight for New Times. He speaks and consults on the new reality facing distribution in a post-recession world. Contact Frank at River Heights Consulting via email at [email protected] or via phone at 563-514-1104.