Ever since we were younger, we were taught how we don’t need everything we see; and we now pass that ideology to our children. Sure, there are many things that we want but we now have the maturity to determine what we need.
In our electrical world, and definitely not exclusive to our industry, comes the age-old question of what do our businesses need to grow, much less survive in these economic times? Manufacturers, distributors and reps all need to do one thing to stay in business: sell. Salesmanship 101 dictates that companies need to have ‘feet on the street’ promoting their wares, or the products of the manufacturers for which they either rep or distribute.
At this point, companies will strategize and brainstorm to determine how best to go to market. This is where the wants vs. needs come into play. All companies would like the luxury of having (and affording) the best salespeople in their markets. However, it brings up those simple questions such as ‘how much can we afford?’, ‘what are our realistic short-term and long-term goals?’ and ‘what is our payback period or return-on-investment (ROI)?’
Let’s take an example on the manufacturer side: Company X is considering entering a new market with a great product. Things that they take into account are marketing costs, manufacturing processes, training, possibly new personnel, amongst others. In order to achieve a realistic ROI, they need to decide what basic and cost-effective items are crucial to success. In years past, large manufacturers would spare no expense to promote a new line in order to get the word out. That is mostly in the past with companies cutting back on the budgets. Company X wants (read: fantasizes about) a huge advertising campaign blitz to share the new information. But they decide that what they really need (read: settle for) is a basic marketing plan with samples sent out to their salespeople and reps.
Agency Y, on the Rep/Agency side, is always looking to increase their visibility of lines with the ‘A’ & ‘B’ manufacturers; which are more recognized in their territory. Agency Y’s wants vs. needs for their business is that they want to have the ‘A’ lines, but they realize that they need to take care of the lines that they have. In that 30-day business model, no agency can afford to do a poor or lackluster job as some did in the past. Past performance and reputation will determine if they are considered for future lines down the road.
On the Distributor side, it is all about (or should be all about) customer service. Again, without customers, we die quickly. Let’s say that Distributor Z decides to diversify into a new industry. They want (read: wish/yearn/desire) the best lines, the best available tools and personnel to succeed. They need (read: must-have) to have the right (and trained) talent and basic tools to successfully penetrate the market. They also need to determine with whom they will align themselves (e.g., manufacturer, rep, etc.). Extensive market research will have to be done to ensure a successful venture. The days are gone for reckless exploratory missions that fail miserably. However, these days are ripe for diversifying in new projects.
Having the right talented people is the key to any successful business model. The days of speculative hires are over. Companies are not as willing to take chances on unproven talent. This makes it difficult for people from outside of our industry to break in and have a chance for success. Just a short while ago, hiring someone simply to ‘take them off the street’ was fairly
common. Today, that same person must be able to bring something worthwhile and, in some cases dramatic, to the party. Again, it comes down to ROI; how fast will a company get their money back and start making money for their part in a business decision?
For another perspective, in baseball, did the Yankees need to spend staggering amounts of money to be the best team in baseball? Did they want to do everything they could to win the World Series? The answer is yes to both. They wanted to win and they knew what they needed in order to achieve that. Their wants vs. needs were apparent. They acted on available resources and took advantage of that. Even if one is not a Yankees fan, we can still learn something from them.
Just like a certain youngster that I know who wants the latest (and biggest selling of all time) videogame, is unhappy about the negative decision recently given that it is not a need but a want. Hopefully he will realize at a young age that in real life, in reverence to The Rolling Stones, much is the same as in business in that we can’t always get what we want.