Globalisation has changed the playing field for businesses, in particular manufacturing companies. There is the opportunity to reach customers in foreign markets and supplier relationships are now on a global scale.
However, this brings with it the added risk of external factors such as natural disasters, political instability and currency fluctuations.
Now, more than ever, businesses are sourcing multiple suppliers for the same products/raw materials. This reduces the reliance on one or a few suppliers but it introduces the complexity of managing a diverse supply chain.
Here are some things to consider when dealing with multiple suppliers:
With shipments coming from all over the world, there is a vast range of delivery times and associated costs for each product from each supplier. For example, Supplier A in China may be able to deliver Product A within three weeks but Product B may take six weeks to arrive from the same supplier. Knowing and managing this information is crucial to a business’ purchasing efficiency and stock management.
If the quality of goods from each supplier is equal, the most important considerations thereafter are price and lead time, depending on the urgency of the customer.
If suppliers know that they do not have exclusive contracts with a business, this may motivate them to offer quality goods at competitive prices. They may even engage in ‘price matching’ with the other supplier(s).
A supplier’s order turnaround time may be its unique selling point and therefore allow it to charge more than its competitors.
A supplier’s capacity to deliver large orders may be a deciding factor in choosing a provider. If a business gets a large customer order, it needs to be sure it can deliver it in the timeframe quoted. It is important to know the scale and size of suppliers’ operations. (If however, each individual supplier of the same item cannot meet demand, this is where it is beneficial to have multiple suppliers.)
Purchasing departments must consider all of these factors before placing an order with a supplier. An automated approach is the most time-efficient method of doing this. Flowlens provides detailed sales information about the quantity of materials required and the timeframe allowed for production. This automatically calculates the delivery time afforded and in turn, selects the most relevant, cost effective supplier to order from.
If you are currently struggling with managing multiple suppliers, Flowlens can help your business.
We’ve combined the most popular features of our Sales and Operations modules to create a starter solution for businesses taking the first step to creating a more efficient Sales Ordering, Stock Management and Purchase Ordering process.
Our manufacturing software is cloud-based, so you are assured of reliability and availability across devices, with no hardware upgrade costs, or expensive per-user licensing.
Having an accurate estimate of the volume of sales that are likely to close, facilitates the smooth operation of many other business departments. The ‘leads to sales ratio’ is a measure that can guide the efficiency of the production and purchasing functions. While it is only ever an estimateand businesses should never completely rely on this figure, it is worth keeping an eye on.
So, how are sales projections calculated? The more historical data available, the more accurate the forecast will be.
Define Your Leads
For the purposes of estimating sales, only count ‘leads’ that have been issued with a quotation. Categorise them further by how ‘warm’ they are in terms of likelihood to buy. You could use a percentage measurement or even colour code them.
Record the number of leads from each stage of the sales funnel that turn into sales and how long they took to do so. As mentioned, the longer that this is done for, the more accurate and valuable the information is.
Note additional trends such as:
Do lower value purchases convert quicker?
Is the product more popular at certain times of the year, Christmas etc.?
Do your customers typically have to spend their budgets by a certain date, e.g. public sector organisations?
Calculate the Ratio
The formula for determining the sales leads to sales closed ratio is as follows:
Total number of closed sales / Number of leads X 100
15 closed sales / 25 leads X 100 = 60%
This means that on average, from 100 sales leads, 60 convert into sales.
If applicable, it may be useful to apply this calculation for various price ranges as the conversion rate may vary depending on the value. For example, you may discover that sales worth under £50,000 have a higher conversion rate than those worth over £50,000.
Past sales are a good indicator of future demand. Once you have determined the percentage of qualified sales quotes that usually turn into orders, you can apply this calculation to your current sales pipeline. Combine the total units of each stock item required for production to enable advance bulk buying.
Download our ebook to learn some of the other best practices for better stock management, involving all relevant departments in the process.
Customer Lifecycle Management is turning business on it’s head, focusing on customer needs first, and delivering profits for the long term.
Bump into anyone from Flowlens, and it won’t be long before you hear the term ‘customer lifecycle management’, or CLM for short. But what is it?
Depending on your role in the business, there are a few ways to describe what Customer Lifecycle Management means. Firstly, CLM is a business philosophy, eradicating the ‘silo’ thinking that reduces customer satisfaction and hampers future profits.
With the customer at it’s heart, it’s a joined-up approach that builds long term value by ensuring that each part of your team understands their role in the customer journey. This not only means they’re focused on improving immediate customer satisfaction, but also how they capture information about future customer needs, and interact with other departments.
Secondly, it’s about competitive advantage, making your team so responsive and effective that the customer should never need an alternative. Your competitors can’t compete if your team is completely focused on meeting customer needs today, but also learning and communicating about future needs. By capturing data with each interaction, CLM enables the marketing and sales functions to build a stronger pipeline of recurring business.
Thirdly, customer lifecycle management is about simplification. Organisations now have so many overlapping systems and databases, that the customer experience is eroded by delays and inaccuracies. Customer lifecycle management seeks to centralise the customer data, and simplify the systems to the point that marketing, sales and operations are all contributing to a single, rich source of customer intelligence data, using software that is designed to deliver effective and profitable customer outcomes.
Finally, it’s about customer intelligence, analytics and decision making. CLM seeks to build a profile of customers that, in aggregate, can help you spot patterns, unmet needs, ineffective communications or processes, cost savings or R&D opportunities. It’s about real-time information at your finger-tips.
What it’s NOT.
CLM is not a spelling mistake. Commonly confused with ‘CRM’, you might think its just another system for managing customer interactions. In our view, ‘CRM’ systems have become part of the problem. They can be clunky, cluttered, and over-engineered, leading to poor adoption and poorer customer experience. CLM delivers a unified, tailored solution, delivered in collaboration with your team and your customers.
CLM is not just for the Marketing and Sales Teams. Across the business functions, and at all levels, Customer Lifecycle Management supports what the customer needs today, whilst capturing information about future needs. By supporting the workflow across the business, CLM removes obstacles, and creates rich information that can be interrogated in real time.
CLM is not ‘all or nothing’. Customer Lifecycle Management is about focusing on solving problems and improving the customer experience where it is needed most. It’s not a sticking plaster either, CLM should build trust and long term buy-in from all stakeholders, and this is best achieved by addressing immediate concerns, whereever they might fall in the lifecycle.
In summary, Customer Lifecycle Management has the potential to turn your business on it’s head, focusing on customer needs first, and delivering profits for the long term
Businesses that innovate survive. Technology enables efficient processes and provides what every management team craves – a single, reliable version of the truth.
The world is changing and our customer’s demands and needs are changing too. Sustainability is now a core value that has taken hold in sectors across the economy.
Traditional ways of working do not support these changes and, as with all change, it is companies who stay ahead of curve that will prosper.
Accessing reliable information and having one version of the truth is critical to understand and manage the demands on your business.
Customers and competitors demand more
Impatient customers, eager for a personalised service, won’t wait around whilst your team figures out which spreadsheet their information is saved in.
They won’t wait around while you get your sales system to talk to your production system. And they won’t wait around while you dig out the folder that holds their spare parts list.
But customers will stick around for quality. They will stick around if they get a prompt service and if they’re kept informed and educated.
And they’ll stick around if they don’t have to think about the minutiae, because you’ve got it covered.
Meanwhile competition is fierce. They’re making better products, that last for longer and give more value. Planned obsolescence is now prolonged resilience. Customers demand it.
It feels like somebody out there is ready to eat your lunch, if you give them the chance. One little chink of light, and they’re in.
How fit is your company for the coming year? As the New Year approaches now is a good time to look at your vision, strategy and team operations to see what you might improve.
5 questions to help you shape your vision
A few moment of honest reflection on these questions can help you understand where your business is, and where it could be.
Who are you, where are you going, why do you exist?
What does utopia look like for your business?
What do your customers want? How are their needs changing?
How should you design your business to serve these needs?
How far can you go?
Deciding on where you’re going is a simple enough idea, and its something your team can develop together, and then get behind.
Can your team deliver your strategy?
Strategy comes from vision. What skills do you need to achieve this vision? Which do you lack? Different people will own parts of your strategy. An honest review of the abilities and gaps in your team will reveal a primary objective.
Get the right skills on board to achieve the vision. Train up, or recruit in. Mentorship, Non-executive directors, there are various ways to develop. But focus on the key skills you need now to get your strategy started.
How does your team operate?
A team focused on a common goal, needs a common language. Here are some essential facts everyone in your company should know:
What your business is, how you make money, what your biggest costs are
What you sell
Who your customers are segments, roles, functions.
Share this language across the business.
In addition, consider the following questions about how you operate:
How do you actually do things?
Where are the problems?
What frustrates customers?
What slows the business down?
Where do you waste time and resources?
How do you measure performance?
Has thinking about your business made you want to improve how you manage it? Read our articles below to see how you can apply your new insights in 2015.
Your sales function is essential to growing your business. If you don’t get the basics right your operations team, your customers and your bank manager could have a big problem.
Have you come across any of these scenarios in your business?
Inaccurate customer requirements and last minute changes to the specification
Customer promises that are made but aren’t relayed to your operations team
Hot deals that suddenly disappear off the radar
Opportunities that aren’t really a good fit for the business
These problems can occur when your sales team doesn’t fully appreciate the complexities of your offering, how you produce it, and perhaps even your overall business goals.
This isn’t unusual given that most sales functions develop organically as the business grows. However there comes a time when a lack of leadership and structure will hold you back, and destroy your profitability.
Standardise your sales documents so all the team knows what you’re selling
Most problems and unexpected costs that arise in operations can be traced back to poor sales proposals and order documents.
If you standardise your product and service offering you can create a consistent costing process. The Sales team can follow this to capture customer needs consistently.
Creating a master product list, driven by an agreed Bill of Materials, ensures that operations know exactly what is being sold, right down to the parts and labour needed to produce or assemble a product.
This in turn means you know how much a job will cost and how much profit it will make, so you can forecast cash-flow if the jobs goes ahead.
With a clear understanding of how long things take to produce, alongside your current workload, your sales team can manage customer expectations about delivery times.
To avoid internal confusion standardise bespoke requests
Where a customer has bespoke requirements on top of the core product, creating a standard form for capturing this reduces confusion on both sides. This spec can be agreed and costed with your Operations, Design and Purchasing teams, and signed off before making promises or issuing quotations.
Key take aways to consider now
Create a consistent costing process
Create a master product list
Create a Bill of Materials
Create a form to standardise bespoke requirements
Target and qualify your sales prospects
Your targeting should be based on business growth goals – key sectors, geographies and products.
Focus on customers you can actually help, and qualify their buying intent ruthlessly. Your marketing and sales functions should be working together to identify and nurture potential customers that are a good fit for your business.
In order to fill quota some sales people will take any and all prospects that look like they might have a need that your company can fulfill. These sales are never going anywhere, a competitor has a more suitable offering, or the ‘prospect’ has no intention, or means, of buying the product.
Qualify sales prospects by determining:
If they’re a good fit
If they have a real need for your solution
If they have budget available
If the buyer has authority and/or influence to make the purchase
Manage your sales pipeline activity
Selling is a science. The actions needed to locate, qualify and nurture real potential customers can be identified.
Sales people should be focusing on building relationships with companies they can sell to and ruthlessly qualify out those that cannot or will not buy.
By looking at your sales activity trends you should be able to see how many meetings, calls and proposals are required to convert into sales.
As your business and sales team grows, it’s important to measure the activities of each individual. Make sure they’re doing the right kind of activities that generate real sales opportunities.
Elements of sales software activity
Depending on your business and customers typical sales activity can include:
As you recruit new team members they can learn the system, and focus on the right activities. Managing your sales pipeline through a configurable CRM platform becomes a process of ensuring the right quantity and type of tasks are being carried out.
As the new kids on the block we could be considered a start-up, but in actual fact we’re not.
We like to think we’ve taken the best bits about starting a new company – the enthusiasm, the best possible team, the opportunities, the shiny new business cards – and avoided the common mistakes – the uncertainties, the ego battles and the struggle to find customers.
After eight years of running web development company Crafty Devil, the founders took the decision to re-focus and re-brand as Flowlens. Read more about that here: www.craftydevil.co.uk
Where Crafty Devil could be considered the awkward spotty teenager hanging around at the back of the room, Flowlens is the self-assured young adult striding forward with confidence.
We’ve learned what we’re good at and we know how we can add value to our clients’ businesses. We’re not afraid to be different because we know our results speak for themselves.
At our relaunch event earlier this week we were thrilled that so many of our current and previous clients came along to support us. We also had Arlene Foster, Minister for Enterprise, Trade & Investment who was impressed with our transformation and commented:
“companies like Flowlens are an integral part of the East Belfast community and provide employment in their local area, which is good news for the Northern Ireland economy as a whole”
We’re excited about this new phase in our company story, and hope you join us as we help shape the future of business technology