Read Part I of this article series here.
Seven ways to get on the right track and start thinking about more growth, even when the economy is healthy.
With rising interest rates, tariffs, changing tax rates, and stiff competition all threatening to derail even the most conscientious electrical distributor’s growth plans, it’s time to start looking at what you can do now to prepare for the uncertainty that lies ahead. “History tells us that good times camouflage poor performance,” says Dirk Beveridge, founder of Chicago-based UnleashWD and author of INNOVATE! How Successful Distributors Lead Change in Disruptive Times.
If you’re not convinced, consider this example: One industrial (plumbing) distributor that Beveridge worked with recently proves just how complacent companies can get when the times are good, sales are plentiful, and new customers are huddling under every new, overturned rock. After a one-on-one session where Beveridge worked with the company to outline its strategic direction for the next 3-5 years—complete with whiteboards and a full room of executives nodding in agreement—45 days later that company’s plans for future relevance and profitability are still sitting on the shelf.
“They thought the hard part was over,” says Beveridge, “but in reality, the difficult part of putting together a plan like this is actually putting it into action.” The latter becomes even more difficult when everyone gets back to work, the phone starts ringing, and the daily “fires” need to be put out. Planning ahead—and especially when the national economy is good—gets back-burnered in favor or other, more pressing issues.
If this scenario sounds all too familiar, it’s time to right the ship and get thinking about what lies around the next corner. Here are seven ways to wrench your firm out of stagnant thinking and into a more dynamic, innovative mindset:
- Define your reality. Be brutally honest about how far you’ve come, where you stand, and where you want to be in 3-5 years. Then, consider the disruptive events that may stand between you and those goals. “We know that times are going to get tough again, but we don’t know when that will happen,” says Beveridge. “Are you putting the right systems in place to deal with the inevitable when it occurs?”
- Consider wholesale distribution fundamentals. Good business sense dictates that distributors should regularly look at their line cards to decide what’s worth investing in, as well as what items should be replaced. But when business is good, these fundamentals can easily slip through the cracks. “Shipping is all about warehouse space, which can be a good indicator with regard to how well your business is doing,” says Nate Masterson, CEO at Maple Holistics. “If you’re worried about storage space, it’s likely that you have some items that aren’t moving as quickly as you would have hoped.” Conversely, some products may be moving so quickly that new restocking approaches are in order. “The latter problem is a better problem to have, but if the former is your problem you may need to do more product testing than you think.”
- Be ready to pivot at a moment’s notice. A good business plan prepares for every eventuality. “The truth is that nothing lasts forever, especially the good things,” says Masterson. “It’s important to be prepared for all eventualities, and in business everything that could happen will happen, it’s more a question of when.” Distributors that have found themselves in a “time of plenty,” for example, would be wise to look at the future now—and towards the eventual time of famine, says Masterson, because it will come at some point. “Assume whatever it is your selling is going out of style,” he adds, “because it is, and you want to be ready to pivot when it does.”
- Get out of your office. Attend an NAED conference, go to UnleashWD, and/or work with a consultant to get fresh viewpoints on the goals and aspirations that you have for your firm. “Sometimes you need that outside influence to help you really understand that reality,” says Beveridge. By getting fresh, outside perspectives on what’s going on in your industry—and then using that information to benchmark your company’s own strategies and successes—you can get a broader view of what’s going on (and, be more prepared for what’s coming around the next corner).
- Keep your distributorship’s name in front of current and prospective customers. This should be an important strategy 365 days a year, says Shelley Grieshop, a marketing pro with online retailer Totally Promotional, and not just when your business is struggling. “Use low-cost advertising methods year-round,” says Grieshop. For example, bulk-priced personalized giveaways can help professionally-showcase your distributorship’s name, logo, and contact information for your target audience. “Items such as customized stress balls, tote bags, pens, and cell phone accessories can be given away at trade shows and local festivals,” Grieshop adds, noting that studies show recipients keep free promotional products on average six months. “That’s a lot of bang for a marketing budget.”
- Give your company a visual makeover. Businesses all need to go through a time of transformation, says Lindsey Havens, PhishLabs’ senior marketing manager, and look at whether or not the branding is working—or if it needs a makeover. “Giving your business a fresher look is beneficial in many ways,” says Havens. “You don’t have to completely change the brand; just adjust to fit your current customer dynamics.
- Take a broader view of your current prosperity. Instead of just focusing on the here-and-now, look at what you need to do to keep the good times in full force—even if the general economy is in a downturn. This comes back to defining your reality, says Beveridge, and helps companies not only leverage current opportunities but also grab hold of future prospects (sooner rather than later). “Understand the fortune that you are reaping right now,” Beveridge says, “while also putting in place the disciplines to prepare yourself for the future.”