Category Archives: Cost-to-Serve Math

236. “Minnow Division” v Data-Free Beliefs

Cost-to-Serve Math, Index

The Opportunity/Problem:

Best, customer-profitability analytics provide many insights for distributors. A common opportunity is an accumulated sea of small, unprofitable accounts: Minnows!  Typical group stats: 50% of all accounts that yield only 5% of the gross profit dollars on 18 – 30% of all transactions. Their cost-to-serve expense dollars greatly exceed their margin dollars for a big, hidden loss.

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219. The Needs For Speed Vary By Customer Niche

Concierge Customer Service, Cost-to-Serve Math, Index

In General: Sooner is Better

When buying a commodity – with all factors being equal – quicker delivery or answers win.

Entire business niches have been created/dominated by fastest response (e.g. Dominos Pizzas). The fastest delivery is: already there! Think of – just in case, curated SKUs – stored in special cabinets or vending machines. (Who pays or shares in the cost of both the upfront design solution and inventory investment is negotiable).

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215. When and How Will Channel Reps Resume In-Person Calls?

Concierge Customer Service, Cost-to-Serve Math, Distribution Strategy, Index

Questions:

  1. Have you heard yet from an old-school buyer that: “Your competitor’s rep has resumed calls!”
  2. Will that be your alarm for resuming full-on, old-way selling?
  3. Are a few data points from old-school, lonely-buyers good market research?
  4. Has Zoomification increased some buyers “rep avoidance” preferences?
  5. How many – new, two-thumb, millennial, B2B – buyers want routine-calling relationships?
  6. Why not proactively survey key buying influences at most-net-profitable (and faster growing) accounts to find out how they want to resume the buying-selling “relationship”?
  7. What if some want, first: better, digital/virtual interactivity. Then, facetime as requested with someone different than the account’s traditional rep?
  8. Do buyers care about your traditional ways? Or: do they want and will get their new way?
  9. And, will pandemic-stressed customers be looking for ways to “buy better”?

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