Commentary & Analysis
What Can You Do to Save Your Customers Money?
A printer e-mailed me recently and said, “the Vice President of Procurement at our biggest customer is open to a meeting but she wants to know what I can do to save her money.” Of course she does, she’s always wanted her vendors to engage with her in a way that solves her business challenges and makes her look good.
By Jennifer Matt
Published: July 9, 2014
A printer e-mailed me recently and said, “the Vice President of Procurement at our biggest customer is open to a meeting but she wants to know what I can do to save her money.” Of course she does, she’s always wanted her vendors to engage with her in a way that solves her business challenges and makes her look good. The difference today is that she’s no longer taking worthless vendor meetings anymore by setting the expectations upfront – she wants solutions not sales pitches. She’s doing you a big favor; she’s training you how to sell to her.
So how can a printer save the VP of Procurement money without decreasing the prices of your printed products and services?
This is one of the main questions the print industry needs to grapple with because it forces us out of our print product mentality and into a services mentality. How can you be of service to the VP of Procurement or the CMO for that matter? Service implies solutions. As a procurement executive, you know what she’s judged on: her ability to save the company money. This does not mean you’re only option is to drop your product prices; in fact I think this should be your last option.
Your ability to respond to this opportunity will be directly proportional to how much you know about this customer’s business. If you know nothing other than the stock and quantity they print each month – you’re in trouble. If you understand their business, have discussed the purpose of the materials you’re printing for them, and see trends in their utilization based on their business cycles – you’ll be more likely to know where you are uniquely qualified to add value, provide solutions, and expand your share of this customer’s overall spend.
Let’s talk a little about the procurement department in general – it’s gone from a place they demote below average performers into, to a strategic sourcing department. Companies have figured out that they can add directly to their bottom line if they simply buy things more efficiently. The software vendors have been busy providing tools to make that buying more manageable by less people with a complete audit trail to keep everyone honest.
As a printer what do you have to offer the procurement department? I think the number one thing that is often dismissed by printers is your ability to source printed products on behalf of your customers. Yes, I’m suggesting you actually look for products and services that your customers need that you do not manufacture yourself (the word everyone likes to avoid for no good reason – “broker”).
What’s the most difficult part of sales? Establishing the relationship, once you have the relationship why wouldn’t you provide as many services as possible through that relationship? Most printers do some spot sourcing for projects where they lack one component (e.g. die-cutting). But the majority of printers stop there, thinking they are best served by chasing the slices of their customer’s business that perfectly matches their manufacturing capabilities. What a wasted opportunity! You invest heavily in building a relationship with a company, you service them well as a manufacturer, you develop their trust yet you fail to gather up all the other print business just because you don’t own the equipment required to run it. Stop acting within your manufacturing limitations and start acting like the global print provider anyone can be – you can print anything, anywhere, for anyone. You know there is nothing but excess capacity in our industry, go find it on behalf of your customers.
Back to the question, “how can this printer save the VP of Procurement money?”
Here’s my pitch to the VP of Procurement:
There are two kinds of print procurement; self-service and full-service. Print that is well-defined, repeating, or templated can and should be procured through a self-service platform (most web-to-print systems). Self-service print procurement can be monitored, tracked, and very efficient if it is done on a centralized system that is integrated into the business processes (e.g. authentication and purchasing) of the company. The majority of print is full-service; one-time custom orders of unique content which require collaboration and project management with a printer that results in a procurement event. Full-service print procurement can be labor intensive, inefficient, and hard to track because it’s typically done via isolated systems (e-mail, phone, FTP).
I would like to evaluate your entire print spend based on this full-service vs. self-service model. I feel I could save the company money by centralizing all the self-service print procurement through a single self-service platform that is manufacturing agnostic. In doing this I will give you (the VP of Procurement) one view into all the self-service print spend no matter how many different suppliers are actually fulfilling through the solution.
For the full-service print I would like to move this activity from e-mail, phone, spreadsheets, and FTP into a platform that can be tracked, monitored, and administered by either fewer people in your organization or by us as a service to your organization. I know we can manage your print spend more effectively because we have both the specific software tools required and the print knowledge from a manufacturers standpoint. I believe we could carve out a savings of at least 20% of your overall spend by simply making sure that self-service and full-service print are properly implemented on platforms that optimize and track all associated procurement activities.
You have to step out of your limiting beliefs about selling only what you can manufacture. Once you have “won” the trust of your customers, it is critical to your success as a company to leverage that trust to expand the services you deliver. As a printer you know how to both sell and manufacture print, it’s not a stretch to also know how to buy it on behalf of your customers. This is a story that will get you the meeting with the VP of Procurement.