How to Play to Win – Not to Not Lose

Written by Mike Marks on Wednesday, 21 September 2016. Posted in Business Strategy, Distribution

Every distributor says they are different because of their service and their people. But those are not differentiators: They are just the ante to play. If you have both, you get to bid. But if that’s your strategy, you’re going to be stuck competing on price.

To gain true competitive advantage, you must create higher profits in two ways: Cost advantages due to your operating scale, productivity or processes, or price advantages thanks to scale with suppliers or mass customization.

You also gain price advantages from making it more difficult for a customer to switch suppliers. If it’s easy for a customer to switch, the dumbest guy in the market will control pricing. Make it harder for customers to walk away by implementing special terms, managing their inventory, offering custom orders or kitting, selling data on product usage, offering specialized support and more.

To gain competitive advantage, you must do something new and not just the same things better. Invest in tools or programs that help you gain a cost or price advantage such as a CRM system, a strategic pricing system, a realignment of the sales force, or the implementation of e-commerce.

If you’re worried about the forces of changes that we’re seeing in the industry – consolidation, the rise of nontraditional competition, the shift in how customers buy – you need to play to win and not play not to lose. Those who are playing to win are not just complaining loudly. They are investing proactively for true competitive advantage.

Read more about refining your competitive advantage:

And learn more about how IRCG can help you set a new direction for your business.

About the Author

Mike Marks

Mike Marks

Mike Marks co-founded IRCG in April 1987. He began his consulting practice after working in distribution management for more than 20 years. Over the years, his narrow focus in B2B channel-driven markets has created an extensive number of deep executive relationships within virtually every business vertical in construction, industrial, OEM, agricultural, and healthcare.

Mike has led project teams that improve market access by aligning resources to growth opportunities serving manufacturers, dealers, and distributors. Clients have ranged from small privately owned firms to many of the industry’s market share leaders. Ownership structures have included owner-operators, private equity, ESOPs, and publically traded firms. Mike is proud of the teams work and the confidence clients have shown with additional project work.

He has written extensively, and is frequently quoted on many industry issues. He has substantial board experience on both public and private distribution firms. His contributions to the field include serving multiple terms as a Research Fellow with the National Association of Wholesaler-Distributors, permanent faculty at Purdue University’s University of Industrial Distribution, eight years as Graduate Adjunct Faculty in the Industrial Distribution Program at Texas A & M University, and rendering several precedent-setting expert opinions in contract disputes between manufacturers and distributors.

Prior to forming IRCG, Mike held the position of Executive Vice President at Lex Electronics, an $800 million vertically integrated electronics distributor in Stamford, CT. Mike’s path to management in his early career was through increasing responsibilities in sales and sales management. He also completed a tour of duty as a manufacturer’s representative.

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