Future of work warehouse & distribution

What’s next? Preparing for the ‘new normal’ and strengthening your customer base

For the last couple of months, many industries have been grappling with massive and sudden losses and changes. Yet many of the warehouse and distribution businesses I’ve spoken with have been able to adapt well.

While a lot have seen some sort of downturn, they have, for the most part, avoided any extreme shifts in sales or operations (with the exception of more Zoom calls and face masks).

However, there is a general feeling among many in the industry that the storm is yet to come – particularly for those who supply to and rely on the building industry. While the initial hit is subsiding, more change is coming. Things like the number of new building approvals and customer buying habits shifting online may mean that there will be a longer-term effect.

If the real difficulty is truly yet to come, it’s important to take some time to prepare for it, and put your business in a position to not just survive but thrive, even if some customers or markets take a hit.

The approach to buying and selling has changed

Right now, all we can do is speculate on what the new normal will look like. But while it’s hard to know when it’ll arrive or how hard it will hit, there are some obvious factors that we know are likely to occur (or already have).

  • Fewer approvals: There is evidence to believe that building approvals are dropping, meaning the real effects of our current situation won’t be felt by the industry until 2021 or 2022. Fewer building approvals will have a trickle-down effect for businesses supporting and supplying the industry.
  • Change in sales approach: Obviously, the typical nature of an in-person sales approach that many business rely on for winning customers and sales will have changed over the last couple of months. These changes could be here for good. Translating these valuable approaches into a new format could be a struggle for many.
  • Change in what customers want: What consumers want from their suppliers has changed. The lowest price is no longer the driving factor for many purchasers. The convenience of being able to purchase online, with cashless and contactless delivery is fast becoming a big priority. Continuing to focus on price as a key selling point runs the risk of trapping businesses in a hard to win race to the bottom.

Regardless of how, if, when or how severely the industry is hit in the coming months or years, it’s safe to say it’s not viable to continue to do things the way they’ve always been done. Going ‘back to normal’ is not the old normal, but a considerably new and different one.

Gaining new customers means connecting in new ways

Ensuring you’re able to adapt to market changes and fluctuating business performance should be a priority right now. Unfortunately, we can’t know what will happen in the future. But by paying attention to the signs and being proactive, you can adequately prepare yourself for what might come.

One of the best ways to prepare at the moment is to look at new customers and markets. To be competitive and win more business, you need to be considered in more opportunities.

However, how you go about gaining new business has likely changed because we can’t interact the same way that we did before. So, you’ve got to try to establish new markets in a different way than what we have in the past. In order to do that, you’ll need:

  1. Systems that support lean processes:

If you’ve had to lean down your processes in the last couple of months, it’s time to start to make that permanent. Simply, this means getting your people doing more effective things, more efficiently. Automation is key, allowing you to remove mundane tasks and ensure staff are more actively engaged in meaningful, productive activities.

  1. Proactive action:

With so many sudden and drastic rule changes, it’s been tempting for many businesses to sit back and wait to be told what to do – or for everything to just return to normal. A smarter way to spend your time is proactively investigating ways to improve. Surveying customers and staff on their changing needs is a smart idea, as is looking at what things in your office or warehouse are going to need to change to match the changing environment.

  1. Support for your customer promise:

Now more than ever, it’s important for business to know their customer promise and be able to articulate it. But on top of this, you will also need the systems that will support you deliver this promise. And so, I’ve seen people, for instance, who they’ll say, “If you get an order in by 4:00 PM on any given day, you’ll receive it the following day”. That’s part of their promises because they’ve got really effective or efficient warehouses, so they can get stuff out quick. And that enables them to form part of that.

Four steps you can take now to flourish in the next phase

We don’t know what the new (or next) normal is going to look like for our industry. It could come sooner, or later, or not at all. The fact is, you’re better off being prepared. If it doesn’t happen, you’ll be in a better selling position with better systems – something that never hurts.

To get started, or to determine areas where you need to invest in improvement, there are four things I’d recommend doing now:

Declutter processes

Declutter and map out your processes. Establish where you can cut unnecessary steps by seeing how long things take and how long they should take. Document each process so everyone knows how it should be done.

Measure your wins

Look at your data, report on what you’re doing and use that to support your business in the eyes of customers. New customers won’t know your value, so show them in a way they can understand – cold hard facts and data.

Articulate your customer promise

It’s a really good time to think about your customer promise and what that looks like. What do you do that the benefits the relationship that you have with the customer? What’s in it for them? It’s simple stuff, but many established distribution businesses don’t do on a regular basis

Prospect, prospect, prospect

Always be prospecting and looking for new markets to sell to, and have a clear understanding of how many new customers you’re getting per day per week, per month, per year. Acquisition statistics are particularly important right now, allowing you to know when you get a new customer, celebrate it, and really make the most of the relationship.

These small changes can set you up to be better prepared for what’s to come. It will also allow you to discover any roadblocks and holes in your processes, giving you time to address them, rather than be caught off guard when it’s too late.

If you’d like to discuss any of the steps I’ve mentioned further, or get some guidance around market expansion, reach out to me via our website or email me directly at rbutler@micronet.com.au.


Author bio:

Robert Butler is the Managing Director of Micronet Systems and is focused on helping business leaders overcome inefficient sales, inventory, and customer relationship management practices by leveraging cutting edge technology. If you want to discuss preparing for the future of work or improving business processes, you can reach out via email here.