Here are 10 useful ideas to help you increase your customer base in the Aerospace and Defense Industry
3. Value Add: The idea here is to offer up an additional service or product that would benefit your customer. Some examples would be "vendor managed inventory", "specialized packaging", "educational seminars", or even "engineering assistance". The objective is to make yourself more valuable than your competition by having a better "total solution" that benefits the customer.
4. Sweet Spot: I often see suppliers chase after difficult or marginal business just to please the customer, or chase the cash flow. Not only do these projects sometimes lose money, but they tend to potentially upset the normal flow of your "bread and butter" core business. Stay focused and prospect within your core competency and you won't have this problem. This may involve analyzing your production and sales history over the past few years to determine your "sweet spot", but in the long run you will be better off.
5. Performance: I still see suppliers that have not embraced nor attempted any Continuous Improvement activities to improve efficiency and performance. This is a big mistake. From basic 5S, Lean, Set up Reduction, Kaizens, Six Sigma, to Value Stream Mapping, there is a plethora of tools, training and consultants to help you take advantage of these activities. All of these will help you become more efficient and desirable to your customers. Also, you should leverage this in your marketing and sales.
6. New Technology: Don't be afraid to try new technology to save operating or production costs. Most new technology is meant to save time and money. From automated pallets to solar panels, it makes sense to explore this area carefully.
7. System for Marketing and Sales: It is very important to have a marketing and sales system in place to manage prospecting activity and potential customers as they move through the sales funnel. Without a system or process in place, this activity is inefficient and ineffective in that you don't know where to spend your time and effort. In most cases, the sales and marketing process is an 80/20 exercise; meaning that 20% of the prospects will produce 80% of the new business and that's where you need to spend your time and effort. To do otherwise would a waste of time.
8. Referrals: Referrals are still a valuable resource for new business. These can be from current customers or partners. Either way, it is a good source of new leads and coming in from a strong referral gives you an edge, and shortens the prospecting cycle.
9. Digital Footprint: In today's world your digital footprint is becoming more important with each passing year. The internet has empowered everyone (including buyers) to research and investigate new suppliers and providers on the web. If they don't find you or there is only a company webpage you're at a significant disadvantage. Using LinkedIN, Facebook, Youtube, Pinterest, Instagram, etc. is commonplace and improves your visibility to your market. In addition, it is extremely important that you have a process in place for building a "Target Email List" of prospects so that you can communicate with them and stay "top of mind".
10. Testimonials: It is very rare that I see a supplier with testimonials. Frankly "word of mouth" is one of the absolute best marketing tools we have. People trust people, and a testimonial or review is pure gold. If you don't have any, you should start asking for them asap.
I hope you find this short list helpful. I know there are many more tips I could list, but I only had so much room and wanted to give you the ones that have been the most successful with my clients. Here's to your success!!!
20 shocking sales statistics
Most of you are burning your money
I had lunch about 6 months ago with three successful business owners. Robert owned a successful Manufacturing Company, John owned a successful B2B Insurance Agency, while Richard owned a prominent Stock Brokerage. All three men were millionaires, and had more than 20 years experience each.
As we got caught up on events in our lives, the conversation naturally turned to business. Remarkably, all of them had survived the "economic downturn" of 2006-present, but with reduced sales and margins. They all seemed to gloat about the "cost cutting" measures they had established, and even tried to up-stage each other as to the severity of the measures.
At this point, I asked if any of them had taken any steps to increase market share or revenue during the downturn. In unison, they said "NO". It was then that Robert (Manufacturing Company) blurted out that he had hired and fired 8-10 sales personnel due to dismal results. John remarked that he had 3 salesman, and not one of them paid for themselves. He continued that it seemed as if the salesmen spent all their time "pounding the pavement", or calling on unqualified prospects who never closed. The conversation lingered on and on about how salespeople were lazy, and stupid, and unmotivated. Robert even offered that his sales folks "couldn't close a door", which brought a round of laughs.
At a break in the complaints, I asked them about any digital tools they were using. Without hesitation, they all confirmed they had a website, email, word, and power-point. In my "very most" humble voice, I asked them if they had any type of CRM system, or web presence beyond their website. The table got very quiet, as they shook their heads no. It was then that Richard blurted out, "Why should we, my daughter uses Facebook so I know it's not for me or my business." "Agreed", Robert and John chimed in.
I then continued by asking what type of advertising they were doing. It seemed as if they were all using the same old tools; namely Yellow Pages, Directory Ads, Trade Shows, and Cold Calling. "Do they work" I asked? "Not in the last 5-10 years", they all answered. Continuing, Robert said "seems as if the whole system has changed". "How so", I asked. Robert then continued, "Well, seems as if the sales folks are emailing or calling all day long with no appointments or results. And when we contact folks from the trade shows, they never answer their phone, return voice mails or respond to emails."
Suddenly, I had a vision of the movie "Pleasantville" all black and white, and I was deep inside the script. Three grown men, afraid to change, afraid to upset what "was" (and had always been).
Richard then turned to me and blurted out "you're the Marketing and Sales guy, what do you think is going on?"
"Before I answer you, I want to ask a few more questions." I said; "what do you think you're spending on these useless sales people, and all your advertising in total and what do you think the ROI is?" The answers ranged from $250K to $350K per year among them with a return of less than 15%. "So what do your salespeople do all day?", I asked. "Well I think they spend their time searching for prospects", John answered. "And How much time is that?", I continued. "I'd say 80-90%", he quickly answered.
At this point, I became very quiet and sat very still, looking at each of them in turn. You could tell they were perplexed and maybe a little worried.
I then asked, "Have any of you made a large purchase for your business or home recently?" They all confirmed they had. In fact, John and Roger had just purchased luxury cars in the last month. I then asked "And where did you start your search for the "perfect car?" Very quietly, John mumbled "on the internet".
So I continued, "So, where do you think your company should be, to be found?" In unison they softly answered "the internet".
In summary, all three of my friends now have a very active web presence through Facebook, Twitter, LinkedIn, Pinterest, etc., and although it is early, their sales folks have seen a dramatic uptick in qualified leads, and a 20% increase in inquiries from prospects who are predisposed to their product or service. This is because the "Sales Process" is initiated by the prospect today. So my question to you is, "Are you still burning your money?". You are, if you hire great sales professionals, and send them out to engage in "press the flesh prospecting". As a marketing and sales professional with 35+ years of experience, the game has changed. Although you may disagree with me, even I (with notorious prospecting and sales skills), have had to acknowledge the effectiveness of Internet Marketing. It is no longer "Pleasantville".
LinkedIn’s Secret Weapon – The Flag !
First of all let me say that I am a longtime paying premium member of LinkedIn. I have also used their advertising platform for years, albeit with lackluster results. I saw the “benefit” of networking and sharing industry insights with my comrades in the Aerospace and Defense Industry. I have also enjoyed the conversations and comments generated by my content postings, and made many new contacts and friends. What follows is my opinion of LinkedIn’s best weapon against your competition.
I have discovered that LinkedIn has a “secret weapon”. It is available to anyone. Anyone can use it in the business war. Yes I will repeat this- “ANYONE” can use this secret weapon. The word “weapon” is defined as “An instrument of attack”. If we consider that the business world is a combative struggle against competitors, or for the attention of potential prospects, then the weapon that LinkedIn has developed is absolutely perfect. It is stealth, effective, and beautiful in its simplicity. Once deployed there is nothing that your enemy can do. This weapon is insidious, in that it is not easily noticed, causes great harm, and does not even allow you the benefit of knowing who has deployed this weapon against you or why. Furthermore, according to LinkedIn, not even LinkedIn has the ability neutralize the weapon.
I have been the target of this weapon 4-5 times over the last couple of years and have had many conversations with LinkedIn support without remedy. Over the last year, I have researched the web, business blogs, support blogs etc., and have discovered some riveting information that I share with you now. It is my hope that armed with this weapon; you too can succeed in beating your competition and be more successful.
This LinkedIn weapon is located in the Group Discussions of LinkedIn. It is known as “Flag”. Let me illustrate how powerful this weapon is. Anyone can flag a discussion entry for being a “promotion”, or a “job”, or for being “inappropriate”. Once you are flagged, your submissions of content are held in limbo across all of your groups unless and until a group manager authorizes it……And this is where it gets interesting. First, there is no succinct definition for “inappropriate”. It is subject to interpretation of the “flagger”. So content that is “flaggable” for one, may be totally appropriate for another. There are no rules here folks. It is the “Wild West”. Furthermore, many group managers are not managing their groups at all. I am a member of 50 groups, and about 60% of the managers have not been managing postings for the last 2-3 years. They are absent. Which means that they will not respond to any requests, approve any content, nor participate in the group.
In my case, I have been in “limbo” more than a few times, even with content that is “on topic”, appropriate, and neither a job nor promotion. And although the LinkedIn support pages describe this condition as lasting a few days to weeks, mine have lasted many months to years, as is the case with absent group owners and managers. In fact, one of my groups has an archive of posts from me spanning 6 pages. They have never seen the light of day, and the owner of the group has not responded to any messages from me.
In my opinion, LinkedIn is ignoring this situation, which provides opportunities for those that have competitors, and dangers for those that submit content. That being said, I’d like to offer some thoughts about this.
1. If you plan on submitting content, do not join any group that has an owner or manager who is absent, not participating, or appears to be “asleep at the wheel”. Remember, anyone can create a group. From a drug dealer, to a well-respected industry thought leader; there are no qualifications. Also please remember that anyone can flag you, and you won’t know who it is or why. This means you could be flagged again and again and again. It could be your ex-employee, your grumpy neighbor, or your wife’s boyfriend.
2. If you have a competitor, ex wife, ex boyfriend, etc. and find content that they have submitted, clearly there are no rules against being vindictive and flagging everything. I know this, as I have been the victim of these attacks.
In conclusion, “Flagging” has rendered LinkedIn groups useless for many of us that have business competition. Until LinkedIn corrects or changes this situation, it is my opinion that there are better platforms for distributing meaningful content to your followers and connections. Many people agree with me on this subject, and describe the LinkedIn platform as nothing more than a “job board”. Thanks for reading my “rant”.
Fiddling while rome burns
The current state of Aerospace and Defense Supplier Marketing and Sales.
Over the last 10 to 15 years, I have consulted with, and or made presentations to 100’s of suppliers ranging in size from small start ups of 15-20 people, to larger Tier 1 and 2 manufacturing plants with more than 1000 full time employees.
Typically I am introduced to these companies when I receive a phone call from the owner or CEO. Invariably these calls follow a remarkably similar pattern. The conversation revolves around the caller’s “lack of new business”, or their “declining sales revenue”. I then will ask them about their marketing or sales strategy and learn that these four actions are almost always present:
1. They’ve hired more sales people. Generally without much training or experience.
2. They’ve attended more “industry shows”, but have no “post-show” follow up plan.
3. They’ve started a Facebook Page, without any content mechanism nor analytics.
4. They’ve started doing some print advertising in their industry magazines.
I then inquire about the results of these actions and in 99% of the cases, the results are negligible.
Although I have written about this before, the telephone calls continue to come from these befuddled leaders, asking “WHY”?
A little deeper into these calls I learn that these companies:
1. Have no CRM system, or a very limited one (outlook) for measuring their efforts.
2. Have no formal Marketing and Sales strategy; and in most cases have not formalized any Strategic Plan for the company. So they are managing their business by “flying blind”, “seat of the pants”.
3. Have not formalized any sales or marketing processes, nor do they feel the need to formalize them.
4. Have not implemented but 1 or 2 digital tools available.
5. Have no analytics to help them tailor their efforts for success.
6. Have not queried their customers with a survey or opinion poll, so they have no objective information about their customers.
7. Have no capture mechanism for learning who visits their website.
8. Have not done any studies of their competition.
9. Do not maintain a current customer list of buyers with emails and phone numbers.
In essence, they are operating without a plan, without any tools, and waiting for the phone to ring.
Does this sound familiar? If so, then I challenge you, the executive leadership of these companies to “Stop Fiddling While Rome Burns”, and lead your company into the future. There are literally hundreds of tools, books, platforms, consultants, blogs, and websites, which are available to help you. There is absolutely no excuse for poor performance. In the end though, it depends on you. You must take action. http://www.barryneighbors.com
Perhaps that’s the problem. Do you continue to “fiddle”, or do you embrace a strategy to change. The challenge is yours.
Have you missed the boat ?
Have You Missed the Boat?
Today’s Aerospace and Defense Supplier is missing the “boat”.
I just finished another phone conversation with the CEO of a mid sized R&D manufacturing company in the aerospace and defense industry. This was my 3rd or 4th call this month with the same lament; “where has the business gone? My sales are flat, and I am pushing my sales team as hard as I can, but to no avail.”
I have received so many of these calls over the last year that I’ve decided to put together this short blog post to voice my opinion on the subject.
First, traditional sales and marketing is passé. No longer is a prospect listening, nor available for your “unwelcome phone call, email, cold call, etc. etc. They have been “interrupted too many times in the past” and have tuned you out, and quite frankly are too busy. Most don’t answer their phone, nor their email. Nope, not even a beautifully designed catalog delivered via “snail mail” gets their attention. They are all shouting………STOP CALLING ME; …..STOP SENDING ME YOUR CATALOG; ……STOP EMAILING ME………I am not interested!!!!!
Now you may be wondering what has changed and furthermore, why the attitude.
In one word……………INFORMATION. Information that is available all the time, everywhere, and anywhere. They are all “online” learning, exploring, and yes, …buying. The buyers and customers of today are utilizing this abundance of “self-serve-information” to learn about and research solutions for their problems and needs. The advance of digital and social media has changed the traditional sales and buying process.
This change is both good and bad for the traditional company and it’s sales team. It’s good because studies have shown that the prospect that approaches you is 50%-60% “sold” (they’ve done the research, so there is no need to educate them about your company, service or product). The bad aspect of this is, that it takes more time from the seller’s perspective.
Armed with this knowledge, where and what do you think a manufacturing company should be investing in as it pertains to their sales, marketing, and new business strategy? I will give you a hint: Go to where your customers are, and give them what they want. They are online doing research and learning. Jay Baer, in his book “Youtility” says “If you want to succeed in a world where the balance of marketing power has swung dramatically in favor of the customer, you need to become a YOUtility.” You need to help your customer learn and be helpful.
With 30+ years of sales and marketing experience, Barry Neighbors has been helping Aerospace and Defense Suppliers with their unique Sales and Marketing needs for more than a decade. Contact us for help……..www.barryneighbors.com
3D Search; A Game Changer
The Performance Improvement Industry is full of companies and consultants with outstanding results of Performance Improvement (PI) projects they’ve undertaken and completed. By and large these results are focused upon reducing expenses and improving profit margins. There is no argument that the tools of PI are proven over the years by thousands of companies in their pursuit of excellence.
Generally the client companies are pursuing goals such as reduced labor cost, reduced cycle time, reduced lead time, improved quality, improved inventory turns, etc. Faster, better, cheaper is the battle cry heard throughout industry.
The most common reasons companies give for embarking upon the PI journey include improved competitiveness, increased customer satisfaction, customer demands, reduced waste, and improved employee morale.
From my experience over the years, the ROI of PI projects are almost never questioned. The metrics that are used to show success are generally posted on the wall and are celebrated by all.
But is that the end? Is that all there is?
I believe that there is key step missing in almost every PI project completion. And yes I do agree that PI or continuous improvement is a journey not a destination; hence the name “continuous”. The results gained have been posted on the wall of the shop floor, but often that’s where it stops.
I’d like you to think about these “results” for a moment. Is there any other value to this “asset” that the company has developed?
My answer is YES!!! Your sales and marketing team should be provided this asset immediately. Why? Because your company has improved itself and this can be significant leverage for increasing your sales and your market share. You are better than you were before, and perhaps better than your competition and can, therefore, provide a better product due to the improvements you have made. Customers and Buyers and Prospective buyers need to know this so they can make educated purchasing decisions. A better supplier or vendor means less risk, better products, potentially better costing, more responsive, and better financial health.
Today’s smart sourcing decisions are no longer based solely on price or cost. Often the lowest price is not the best price in terms of “Total Cost of Acquisition”. Total Cost of Acquisition includes many factors and one that is critically important in smart sourcing is “risk.” Risk relates to many things and is primarily boiled down to financial risk and production risk. A supplier who has done little or no PI has a higher internal cost due to inefficient processes and workflow. This affects more than just the production results; it also causes them to be less financially healthy over time, translating to higher risk. With higher risk comes a higher potential for a “surprise” to their customer. We’ve all heard the stories about the customer arriving at their supplier only to discover that the supplier has priced himself into bankruptcy and the front door is chained.
So in closing, I’ll just say that in my experience, a capable, high performing, low risk supplier is much more valuable to the customer. Armed with PI metrics, the sales and marketing folks should make full use of the potential of this company asset to help them close more sales.
This week I received another call from a senior professional acquaintance informing me that he had been laid off after 22 years of dedicated loyal and award winning performance. His employer cited the current economy, and the Federal Government’s Sequestration forcing budget cuts across the board. The call was the 5th call that I have received in 2013 and it’s only March.
Out of curiosity I ventured onto the Bureau of Labor Statistics website and discovered that their Mass Layoff Statistics program (http://www.bls.gov/mls/) was itself being terminated due to Sequestration. Wow.
Clearly, the economy is not in good shape; although some would argue that we are moving in the right direction.
At any rate, I started thinking about the human predisposition for “quick fixes” in life as well as work. It often seems as if the first action a company (or government) undertakes is a reduction in workforce, or layoff. These layoffs often are governed by rules and or processes, which have no real data to support the selection or value of the employees terminated. I would also argue that many of these decisions are based upon personality conflicts, lack of value placed upon sustainability, and frankly outright laziness.
What about a possible alternative? If you ask any performance improvement practitioner about the possible cost improvements from Lean, Six Sigma, Value Stream projects or any of the Continuous Improvement Tools in the world, most would probably say that the cost improvements can range from 20% to as much as 80%. But they would follow with, “It takes work and support of leadership” to be successful. In my career, I would agree with these folks. In fact, less than 10% of all of the companies that I have assessed or interviewed have completed any kind of Value Stream Mapping of their key and critical processes. Furthermore, I have only run across a formal documented “Job Skills Certification” program within a company twice in the last decade. Not sure what to make of this, other than to say it is, “Seat of the Pants Management”, which is all too common in todays world.
This brings me to the point of this “rant”. Why don’t leaders focus on improving their companies and/or government agencies? Certainly a modest 25-30% improvement in expenses would help offset a financially challenging economy.
The improvements made would help the company through the difficult times, and position the company for a greater success in the good times.
Layoffs may help boost the bottom line in the short term, but the long-term costs may be more than the savings. Consider the following costs: severance packages, accrued vacation payouts, benefits continuance, manager’s time to reallocate work, and increased cost of unemployment insurance. In addition, we have the indirect costs of low morale affecting lower productivity and quality, lost knowledge and skills, lost innovation, lost contacts, lost market share, angry customers, and the cost of recruiting and rehiring during an ensuing “ramp up”.
So in summary, while layoffs may seem to be an easy fix, the long term effect may not even come close to the ROI of focusing on improving performance.
Barry Neighbors has extensive experience working with OEM's and A&D Suppliers on Supply Chain issues. Focused on developing a more efficient supply chain, or helping suppliers in their business development efforts.