Customer expectations continue to escalate. The traditional perceptions of good customer service are becoming obsolete. So are the electrical distributors that cling to outdated business models. Some beliefs of the past need to be held up for scrutiny. Upon close examination, we may find that what once passed for truth is nothing more than a myth.

Myth #1: The Customer Knows Best.

This isn't the same thing as “the customer is always right.” This is about letting the customer know when there may be a better alternative than the conventional wisdom. For instance, a salesman told me about a customer who was determined to relight his warehouse with LED high-bay lighting. The customer read all of the trade magazines and saw that LED lighting was the latest “big thing.” So he reasoned it must be the best. The salesman suggested that they visit a nearby lighting manufacturer that had a number of “mock up” lighting applications. One of the displays featured 400W ceramic metal-halide high bays. The customer liked the looks of the layout and with further investigation discovered that the ceramic metal-halide was the better choice even though the customer originally had his mind set on LED. The salesman would have been doing the customer a disservice by not showing him the alternatives.

The latest technology isn't the best fit in every situation. When it comes to something as fast-paced and technologically layered as electrical equipment, most customers don't have access to or the awareness of resources available to the electrical distributor. The customer is dependent upon the expertise of the wholesaler to offer suggestions and to provide the most effective way of achieving the desired results.

TRUTH: Customers rely on distributors to provide them with the knowledge to enable them to make informed decisions.

Myth #2: We don't Need No Stinkin' Marketing Plan.

From my days as a salesman, I remember unopened boxes full of expensive marketing promotional brochures getting tossed into the trash because they were out of date. Why were they unopened? Because the salesmen wouldn't use them. I'm not sure where the marketing and sales rivalry began, but a dialogue needs to open up between the marketing department and the sales team. If the marketing department isn't providing relevant and useful materials, then the sales team needs to communicate that. By combining their efforts, the marketing department can arm the sales team with some powerful tools of persuasion.

TRUTH: Marketing is essential to growth.

Myth #3: All Customers Buy On Price.

It only seems that customers focus primarily on price because “price customers” are the most vocal. There are two types of buyers: transactional and relational. The transactional buyer, as implied by the name, is focused only on the transaction. What's the cheapest, the best, the fastest for the money. If a distributor wins one transaction, he earns no loyalty from the transactional customer, only an opportunity to compete again in the next transaction. A relational customer, on the other hand, is focused on finding a distributor he can trust and depend upon. Money is a factor, but the relational customer believes that if he builds a relationship with a trustworthy distributor, he'll be treated fairly on the price. Smart distributors seek out and focus on the relational customer.

TRUTH: Some customers value a trustworthy distributor more than a cheap price.

Myth #4: If You Just Keep Selling, Growth is Inevitable.

Many distributors seem to believe that they deserve an increase in revenues with each passing year. That's like saying you deserve a raise because it's your birthday. Growth requires strategy. Retaining customers, prospecting for new clients, and gaining market share are a few of the elements in the growth strategy. Start by having a clear awareness of your daily cost of operation. Growth comes from knowing that number and exceeding it on a regular basis. Research the market potential for the communities in which you work. Uncover the fastest growing markets of the electrical industry in these communities and determine if you can leverage the strengths of your firm to take advantage of these new developments. Growth doesn't just happen.

TRUTH: Growth is a choice and it requires deliberate planning.

Myth #5: A Satisfied Customer is a Loyal Customer.

Think of it this way: A customer can be “satisfied” with your company and your competitor at the same time. “Customer satisfaction” means you met the bare minimum of the customer's expectations and is no guarantee of customer loyalty. Loyalty is earned by actions. Are your deliveries to customers accurate and on time? Can your customer get a live voice when calling your branch? Are your projects on schedule and problem free?

TRUTH: Customer loyalty is earned by the actions you take.

Myth #6: Wholesale is Different from Retail.

Admit it. Part of you still wants to believe the customers in wholesale are somehow different from the ones who shop in the malls. You still believe that the wholesale industry exists in a realm separate from retail. Maybe so, but the electrician at your counter buys from retail businesses, too. He takes his five-year-old son for ice cream where the server turns a double-dip cone into performance art. He takes his truck for an oil change and is served cookies and coffee while he waits. He eats donuts at a bakery that offers free WiFi. These vendors and others like them have raised the standards for service — everywhere.

TRUTH: There are no borders in business anymore.

Myth #7: If it Ain't Broke, don't Fix It.

Wholesale distribution will continue to thrive, but only by moving into new territory. There are wholesalers who are doing business today the same way they did in 1970. Success can be an obstacle to continued success. Past glories and achievements can lull a business into a sense of complacency. Unfortunately, the old business model is failing fast and successful growth means leaving something behind. DIY centers and big box merchants will continue to be a threat. Fortunately, for the wholesaler, these behemoths belong to mega corporations that are unwieldy and slow to respond to changes in the business landscape.

TRUTH: If it ain't broke, break it. It's probably out-of-date anyway.

Myth-Busting

No distributor can afford to maintain a casual business-as-usual attitude. With new competitors coming in, multiple channels vying for a share of your customers' minds, and roller-coaster-like market swings, it's quite the challenge to stay ahead.

Knowledge of the electrical industry, awareness of competitors' competencies, and a critical assessment of the company's strengths and flaws are essential elements in meeting customers' expectations. Companies that achieve this will find a more rewarding, less competitive marketplace.

The author is the founder of High Voltage Performance, a consulting firm that specializes in designing customer experiences for the industrial marketplace. Dandridge has 25 years of experience in electrical wholesale distribution and authored the book, Business Turnaround. He is available for speaking engagements and can be contacted by phone at (254) 624-6299 or by e-mail at md@theperformancepro.com. Read more about his idea for “Customer Experience Architecture” at www.highvoltageperformance.com and check out his blog at www.businessturnaround.blogs.com.