Customers come first
Steve Harrop, the recently appointed chief executive of Advantia, tells Austin Clark why dealers must put customers first if they are to survive and thrive over the coming months and years
“There’s no getting away from the fact that it’s a challenging time for businesses as we simply can’t avoid the headlines surrounding big issues such as the recent election and Brexit,” says Steve Harrop, recently appointed new chief executive of Advantia. “In so many ways the challenges we’re facing are unprecedented – but with the correct mindset, a focus on customers and some innovation, out of those challenges come opportunities.”
Steve points to the exchange rate issues triggered by the Brexit vote and the ‘surprising’ general election result as an example. “Clearly, there are pressures when it comes to pricing and increases are inevitable. Passing those increases on to customers is never easy but what dealers need to remember is that, in the B2B space, everybody is in the same position. Just about every company that every dealer is selling to has been affected and the majority of customers will be putting the price of their goods and services up too – or they’ll be getting stung when it comes to raw material costs.
“Dealers therefore need the strength of mind to open dialogue with customers and talk to them about pricing which, in turn, can open doors. It’s also worth bearing in mind that dealers can raise prices in tranches – they don’t have to do it in one big hit; very few dealers have contracts with customers which gives them flexibility during discussions.”
Navigating through the uncertainties
When asked how dealers can work through the tricky times ahead Steve says it’s all about having belief in what they’re doing, faith in their own abilities and strengthening customer relationships.
“I’ve always used the word 'engagement',” explains Steve, “because dealers really have to understand their customers so that they can have the relevant conversations. We’re all talking about 'diversity' so dealers need to have strong enough relationships to open dialogue. Knowing customers well allows dealers to be more certain about which products they can sell; be more certain about your customers in an uncertain market.”
Another area where dealers need to be investing is in their online presence, Steve says – which, in his opinion, is no longer the future but very much the here and now.
“Dealers shouldn’t see online as another tool,” he says. “They need to have a strategy. They need to work out how it integrates into their businesses and how it relates to, and engages with, customers. For online to work for dealers I think they need flexibility in terms of product selection and pricing and in the presentation of products. Getting the message out to customers about the online solution is also key.
“I appreciate that for smaller dealers this is tough but they need somebody in the business with the expertise and specialist knowledge to drive online growth. They need somebody who understands the web, has a knowledge of SEO – and can put it at the centre of a business alongside a good marketing programme – and use those relationships to develop a good, local online presence. It has to be high in any dealer’s plans when thinking about customer reach, otherwise they’ll get left behind.
“There are already some dealers doing great things online. Paperstone in Kent springs to mind – they’re not an Advantia member, by the way, I just like what they’re doing – and they demonstrate that dealers can succeed in the online space.
“It’s worth pointing out that the tools required for dealers to succeed are available. I’m still new at Advantia but our Merlin Marketplace solution has surprised me. There are still elements to refine, but there’s so much more to the solution than I was aware of – it really is very good – and I’m confident it will help more dealers to succeed online."
Change and innovation
Change and innovation clearly needs to happen if dealers are to survive, but does Steve think it also comes down to attitude – and the need to really put everything into new initiatives and not do it half-heartedly?
“I agree, and I think plenty of dealers do get it – I’ve been impressed with the Advantia dealers I’ve met so far – but it’s important to note that change needs to be funded; it can’t be done on the cheap. That will become increasingly important as the wholesalers, who have worked hard to lead change, realise they haven’t got the funds to do it. I think, when it comes to change, too many dealers are caught in the headlights. They just need to take a step back, look objectively at their businesses to work out what’s needed and look for the most suitable solutions for their needs. They shouldn’t be afraid to challenge the tradition of the industry and the status quo.
“I believe that the same applies when dealers are thinking about the costs in their businesses; there is a need to strip out costs. The Truline/Advantia delivery model is a good example. It’s a white glove service that uses the resources of the distributor to take out cost – yet all too many dealers don’t take advantage of it. They need to leave out of the equation the fact that Uncle Johnny is a driver or their son manages the warehouse and look objectively at their use of resource. If a job can be done by people who are better at doing it, for less money, then what is the barrier to change? Instead of thinking about deliveries, dealers need to think about customers.”
Steve concludes by saying, “To survive what is going to be a tricky period, dealers need to challenge themselves and what they do. They need to challenge the status quo within their businesses and the wider industry, think about how they work and who they work with, put customers first and adopt new technology to help them along the way. Do that and there’s no reason why they shouldn’t thrive. And you know what? The dealer channel has changed for the better before; and I’m confident it will do so again.”
Posted by Austin Clark (95)
Written on 25th July 2017
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