COVID-19 has had a profound effect on how B2B distributors price their products, assess their cost basis and position goods with customers. Consider this quote from Matthew Kropp, managing director and partner at Boston Consulting Group, from a recent article:
“In any time of reduced demand, businesses face the challenge of trying to maintain sales velocity while their customers cut or delay spending. This demands discipline in pricing to avoid setting a new lower price floor that haunts them after demand returns. In this particular crisis, the specific uncertainties involved make careful pricing practices doubly important. Is the customer holding off on spending to reduce cost, or because they fear that quarantines or supply chain interruptions will prevent you from delivering?”
Certainly, there are many unknowns with respect to the pandemic, however, recent findings from the Zilliant 2020 Global B2B Benchmark Report are clear. Regardless of macroeconomic factors resulting in volatile demand swings, most B2B companies are operating with a normalized pain with respect to pricing practices. Practically, this means that margin gains are possible simply by abandoning manual means to set, update and deploy pricing in your business.
Distribution-Specific Pricing & Sales Tactics
B2B distributors face unique challenges with respect to both pricing and sales in this new, uncharted territory. Field sales reps are adjusting to fully digital sales, pricing teams are challenged to hold the line on margin, and if not in place, distributors are scrambling to stand up a smart and effective eCommerce channel ASAP. Consider this quote from Mike Emerson, partner at Indian River Consulting:
“Distributors have far more access to data than they did 20 years ago. Leverage customer analytics, including geography, market segment, service output, travel required (which has also changed), how reps are spending their time and so on to realign your structure to meet customers’ needs. Usually, more than 20 percent of accounts assigned to an outside sales rep can be moved to another lower-cost function, such as inside sales, customer service or even an online self-service solution.”
This is absolutely true, and the good news is that it is possible to act on your available data faster than ever before. In this 10-minute clip from a recent Standav webinar, Zilliant Chief Marketing Officer Lindsay Duran addresses how to do so and answers seven pointed questions about how to adapt to the new normal as a distributor in the midst of a pandemic.
Watch now to learn how distributors are adapting given considerations such as:
- Is there a need for re-segmentation of products and customers?
- How is the sales process evolving?
- How can pricing software help distributors conduct what-if scenario planning?
- How do you balance inventory shipments?
Access this timely clip to hear her answers to these and more.