It’s easy to say that we’re dedicated to fulfilling customer needs. Yet how many of us take the time to investigate the value chain of which we’re a part? Could we work more profitably if we invested more effort in exploring our customers’ worlds?
The timber trade is entering a new phase of its evolution. As ‘best practice’ and new ideas come in from other sectors, we are beginning to realise that we can add value to our product by changing our attitude. Timber should not be sold as a commodity: it should be recognised as a quality component of an end product. But are we prepared to invest the time in learning about the timber value chain, and is it likely to be a profitable exercise?
Sales of timber and wood products depend on the smooth functioning of the business chain, from forest through to end consumer. Everyone has a part to play. Looking in detail at the onward processing of your basic products could enable your business to differentiate itself from competitors, offering a service more closely geared to customers’ use of the material.
Of course, it’s comfortable to sit back and say the task is too complex: ‘My customer base is too diverse. They use our products for just about everything, and we’ve many levels of customer relationship. We sell them the product and it’s up to them what they do with it.’ But if you feel your business is complicated, think of a builders’ merchant. Hundreds of products to keep track of, many levels of customer relationships ranging from the building trade to consumers, and a promotional face to keep up with each of these groups.
Exploring new worlds
Peter Crook, timber product director at Travis Perkins, says: ‘We have thousands of lines in timber alone and we need to ensure that each customer at every level gets timber which is fit for purpose. We need to know what they’re going to use the timber for, or else we’re in danger of supplying something which could ultimately be a cause for complaint. Worse still, if the customer isn’t happy with the function of the timber in situ, it has a knock-on effect on our reputation. Knowing your customers and their intentions for the product is more than half the battle of running a successful business.’ Travis Perkins has won the Builders’ Merchant of the Year Award for no fewer than six of the past seven years.
If you’re convinced you know all there is to know and that you can make no improvement to the product or service you supply to your customers, then move down a level to find your marketing differentiator. What are the needs of your customer’s customer? How far down the line can you gain an in-depth understanding, not just of use, but of market conditions, sales-influencing factors and competitiveness drivers? What else could you do to provide your customers with an extra competitive ‘edge’?
Two-way information transporter
We are all part of an extended value chain which depends on consumer and end-user enthusiasm for wood products. This is where the worth of campaigns such as Wood for Good or concepts like the Wood Bureau become more apparent. Wood for Good is out to educate end users and to win hearts and minds for solid wood products. Yet education and attitude-changing represent only one side of the equation. Survival ultimately means sales. Currently, to connect our trade with the end user, the equivalent of a Star Trek ‘Transporter’ is needed to beam sales back up the value chain in our direction.
Perhaps this is the reason why some in the industry have so far failed to show enthusiasm for Wood for Good: it seems too remote from their particular ‘reality’. What the sceptics fail to realise is that the sales ‘Transporter’ works both ways. Unless they get to grips fully with its controls – by grasping their customers’ practical and promotional needs – they will not gain their share of the business potential being explored at the other end.
