Sign & Digital Graphics

December '18

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16 • December 2018 • S I G N & D I G I T A L G R A P H I C S RUNNING THE BUSINESS difference in the two figures is the true impact of the price increase. (More on the use of this information, in the hands of your salespeople, later.) Don't assume a price increase will be the "final straw" that causes the cus- tomer to shop elsewhere. If you have to raise prices because of escalating COGS, there's a good chance your competitors will follow your lead... if they haven't taken the lead already. Price is rarely the reason a customer fires you and switches vendors. Overwhelmingly, inconvenience in doing business and the loss of trust resulting from failure to deliver on time and/or other breaches of faith are the most common reasons customers seek new suppliers. Come Out, Come Out, Wherever You Are Most salespeople adopt an ostrich mentality when told they must deliver a price increase. Uh-huh. You salespeo- ple reading this know what I'm talking about. Yet, the accomplished ones view it as a chance to strengthen—rather than threaten—the customer-supplier partnership. Once you've decided to pull the trig- ger on raising prices, train your sales team—both inside and outside reps—to practice, rehearse and master this list of do's and don'ts: Do take personal ownership of the price increase. Anyone whose compen- sation has a commission or bonus com- ponent to it will benefit from the addi- tional revenue. So don't slough it off as "management's ill-conceived notion to become richer." Remember, in the eyes of the customer, the sales representative is the company. Don't avoid or ignore discussion of the increase. Do be proactive rather than tak- ing a defensive posture about the issue. Get on the same side of the desk as the customer—psychologically and emotion- ally—to work through the issue. As stated above, don't assume custom- ers will contemplate changing suppliers just because you are raising prices. In many cases, the transition of switching vendors—depleting the old supplier's inventory and stocking new stuff, con- ducting training on the different way a new vendor's product must be handled and used, setting up a new supplier in purchasing and materials-management systems—is costly, time-consuming and, generally, an unwanted headache. Do have a written pre-call sales plan on how you will address the price increase for your largest and/or most fre- quent customers. Consider delivering the price increase letter in person. Role-play the sales call with your sales manager or a colleague to practice various possible scenarios, objections and customer con- cerns. Do solicit and assess the customer's reaction to the price increase immedi- ately after it's received. Obviously, no customer will be delighted at the news, but most will not be shocked by it either. If the customer accepts it outright, say thanks and assure her you'll continue to do whatever it takes to earn her business. Do prepare yourself to offer the cus- tomer something that is of low cost to you (but of high value to him), to offset or soften the impact of the increase if/ when you observe "push-back" or out- right rejection of the price hike. For example, you may offer your assistance in helping them with their efforts to grow and prosper—introducing them to new prospects or business contacts or sug- gesting ways to maximize the visibility or impact of the graphics you produced, to name a few. Whatever the offer, work with your client to determine the value of it—expressed in real dollars, if possible— and then compare that figure to the true overall impact of the price increase that you calculated earlier. Obviously, you are looking to offset the price differen- tial by providing a special added value that should result in continued customer satisfaction. If you are genuinely committed to keeping the customer delighted—even at higher prices—your sincerity and actions should overshadow any adverse impact of a price increase. Good luck! SDG DO provide your customers with enough advance notice that they're able to take advantage of placing advance orders before the onset of the new prices

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