No matter which channel you serve, supply chain issues have negatively affected how you do business. Microchip shortages, manufacturing shutdowns, and shipping/logistics nightmares have all left some scars. Nothing you and your customers haven’t been experiencing or reading about for months on end, right?
One of my favorite books is The Fellowship of the Rings. Gandalf, when faced with Frodo in distress about the heaviness of having to carry the Ring, said, “We cannot choose the times in which we live, only that which we do with the time we are allowed.” In other words, no point whining about our challenges.
Today we’re moving beyond the doom and gloom of supply chain issues to discuss strategies that will help you win (and deliver!) anyway. These ideas came out of conversations with providers and manufacturers who have real-world experience in combating this challenge. So, without further ado, let’s look at the 5 top strategies.
5 Top Strategies to Help You Win Despite Supply Chain Issues
Now is the time to stock up when you can afford it
We’ve all become accustomed to drop-shipping from our suppliers. Traditionally this has been a great advantage, because there’s fewer dollars tied up in inventory and we can usually have our suppliers ship to our customers on demand. “Traditionally” is a liability right now as product, even for our suppliers, is often arriving in dribbles, coming by the pallet and not by the truck load.
I’ve heard from dealers that by the time the product arrives in the US it’s already 100% spoken for, so you need to order ahead of time—don’t wait. This won’t be easy as it will cost you some money up front, more than you’re accustomed to spending before you make the sale.
However, if you want to ensure you can supply your customers with less disruption follow Kodak’s lead: make sure you have at least six months of inventory ready and stocked. Kodak used to keep two to three months of inventory, but they’ve invested more to ensure they keep up with demand. Supply chain issues are predicted to be a problem through 2023, so consider that if you’re a little nervous about carrying more inventory than you used to.
Going off-brand is better than having nothing to sell
You’ve likely built a lot of your brand recognition and reputation around some of the manufacturer lines you are authorized to carry. If the manufacturer brand you carry is unavailable, you’ll want to consider procuring and selling “like” items from other brands. It’s not ideal, your service team may not like it one bit, but the alternative is your customer going to a competitor to have their needs met.
You’ll have to work on messaging as to why you are offering things you usually don’t, but at the end of the day, your customers are suffering from supply chain issues, too. They may be much more flexible than you might think. Alternatively, if you happen to have the good fortune of carrying a brand that is flush with supply, you can use that to go after prospects who may not have been good targets before.
Extend existing contracts
Statistically speaking, most of the equipment you sell customers likely has a lot more life left in it than the contract lease or finance terms reflect. When there isn’t new gear to replace lightly-used equipment coming off a contract, simply extend those contracts for another six months to a year. A contract will keep you safer from competitors and ensure that the only one serving your customer is you.
It’s going to hurt from a revenue perspective, and it may impact your manufacturer discount levels if you’re not hitting targets. Work with manufacturers to get some grace on commitments and discounts right now, and if they are worth their reputation, they’ll work with you to come to a fair compromise until supply chain is back to normal. Extending a contract is not the same as renewing a contract, and you can learn more about the differences here.
Refurbished equipment is worth a second look
As mentioned earlier, much of the equipment coming off contract is only gently used and has lots of life left. For much of my managed print career, I made a living off extending the life of existing customer assets. There are lots of companies out there who will sell you refurbished equipment in “as new” condition. The good ones will even paint or treat any yellowing plastic to be as white as the day the item rolled off the assembly line.
Even if you don’t sell refurbished equipment, compatible or refurbished toner cartridges for printers, for example, can really help right now. If you sell desktops, laptops and servers, or communications equipment, explore your options with your customers and get a feel for their flexibility given the strange days in which we live. You’ll be surprised how many will be open to the idea. If you are looking for a great resource for refurbished printers and IT related products, check out Depot International.
Diversify into the cloud
As technology providers, many of the “things” we sell are fast being replaced by cloud services. According to a recent study, the cloud services market is set to grow to $947 billion USD by 2028 with a double digit CAGR of over 16%. Document workflow, application hosting, virtual desktops, IP telephony, and unified communications are all things with virtual alternatives now. (For more details on the study and predictions on market growth and size in other channels, download our Managed Services Guide to New Vertical Growth.)
More than just giving you a virtual option for the things you already service and sell, cloud services can open a whole new range of offerings you can extend to your customers. It’s not easy to pivot and learn new solution sets, but right now nothing is easy, and everything is up for grabs. Supply chain issues have another year, at least, before they start to improve, and even then, it’s going to take time to get back to some kind of normal (if it ever does!) The best time to reinvent your business is not when times are good, but in times like the ones in which we now live.
We’re here to help
The above strategies won’t be easy, but they will allow you to continue to grow your business and satisfy your customers’ needs. Gandalf has some more words of wisdom for us that I think will help you as you make decisions in less-than-ideal times. When asked why he chose the tunnel he did when he came to a fork in the mines of Moria, he said “Because this one smelled less foul.” These are hard times, and we simply have to do the best we can for the sake of our businesses and our customers.
If you need help exploring any of these options, Tigerpaw is here to help. Our customers and partners span just about every technology channel you can think of, and we likely have experience, connections, and partners that can help accelerate your efforts to combat the ongoing supply chain nightmares. Connect with one of our Tigers today to get started.