Stop the static
Sales channels are the tactical delivery arm of any business and need to be aligned with market conditions, customer needs, and company-specific objectives. But too often, misalignment between customer needs and the ability of the sales channels to meet them can create performance gaps that can threaten a company’s financial performance. Why the threat to the bottom line? Because of the costs associated with delivering ”value” as well as poor sales performance caused by loss of customers, competitors seizing market share, and unfavourable channel partners.
Performance excellence can be achieved, however, through a process often referred to as “channel optimisation.” This entails identifying the most appropriate level of service for each customer and the most efficient delivery model for that service, an approach that should result in the most profitable relationship possible.
We believe companies that seize the opportunity to improve their channel performance can enhance their financial results and rise above the competition. The European division of a global manufacturing company benefited from an innovative channel optimisation approach. The company faced numerous issues that were keeping it from growing. But by understanding what customers truly value, measuring the cost to serve customers, and selecting the most efficient route to market, the company was able to achieve a 3 percent revenue increase for the first year following implementation, far exceeding its initial financial goals.