1. Increase Penetration In Existing Markets
Over sixty percent of the respondents focused on what they are already good at–selling to their current market. All the systems are set up. The team knows how to make it right. Stick to your knitting and grow market share in what you do best already. Your firm has a good reputation here–exploit this foundational portion of your business to get the easiest quickest sales.
2. New Products Line Extensions
The second most popular strategy to grow sales was to extend the product line to a new complementary product that existing clients would be pleased you now offer. For example, for years my company, Marlin Steel, only offered wire baskets but we were frequently asked to make sheet metal fabrications but we did not have the technology nor the skill set. In 2010, we broadened the line and bought the best sheet metal fabrication machine in the industry and this enabled us to please our best clients. We became more indispensible to their operations and more orders flowed. It made the great recession a non-event at Marlin. What product lines should you add today?
3. New Client Segments
Over forty percent of respondents believed focusing on new client segments will power strong growth. Observe and identify other activities your client is buying from others that you could make for them. For example, at Marlin Steel we focused for years on baskets for material handling that complement nicely in a factory environment but we overlooked the ultrasonic cleaning market in the R&D labs or in the cleaning stations at the end of the line. By broadening our client segments we grabbed more clients that worked under the same roof. These prospects already had the confidence of our clients (their colleagues)–it makes for easier growth.
4. New Export Clients
95% of the world’s population is overseas. Most American companies do not export. This oversight misses huge opportunities overseas that can rapidly grow your company. The “American” brand is prized overseas. You are fortunate that your American quality resonates before you even start the dialogue with the prospect. Over thirty percent of the NAM survey respondents are deploying this technique to power growth smartly.
5. New Channels of Distribution
Aggressively opening up new channels of distribution will increase sales. For years, Marlin Steel sold to large factories and pharmaceutical companies. Over the last decade we added selling to catalog houses. We sell this channel in big volume (like we do to large factories) but the catalog houses are geared to sell single lot sizes that make no sense for our company to deal with. This new channel has increased our business nicely and smoothes out erratic purchases from our existing client base. Finding new channels will strengthen your brand and make your firm more impervious to the ups and downs of your existing channels.
6. New Services
Offer new services to your clients so they become more enamored with your firm so you are more “sticky” and harder to leave. Make sure the services are profitable. They will strengthen the bonds of the relationship. At Marlin Steel, we offered an aggressive new service–“consignment” programs to our creditworthy large accounts. This enabled our clients to order more from us because they were not sitting on big mounds of inventory but they could react fast and ship large surprise orders because they had our products on their factory floor. In addition, the new consignment clients ordered in such large volumes they could take advantage of better freight since they bought in truck quantities (not little packages). After you take into account the drawn out cash flow effect, you will see sales raise and your relationship solidified. What new unique services can you offer that will make the moat around your company (stealing an astute phrase from Warren Buffet here) a mile wide?
7. Aggressive Pricing & Loss Leaders
When one goes to the supermarket, Milk or Orange Juice are frequently priced at cost or below to act as a hook to pull you in to the store. Once in the store, you look around and say “actually, I need this” or “I need that.” Both of these other products are marked up with juicy margins compensating for the “loss” on the milk. What products can you offer a deal on to intrigue your clients so they get hooked in? Of the entire list, this is my least favorite because I think you should only sell on Quality and Delivery–not price. There is always some sap out there that will make a mistake and charge too little which will lead him to the poor house. I would stay away from this last idea (less than 10% of NAM respondents choose this anyway.