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Posts Tagged ‘value-added’

How Much Are You Worth To Your Customers?

Tuesday, November 1st, 2011

Distributors can help customers with regulations, even something as simple as making sure they have fire extinguishers mounted and charged.

What if you could save a customer $59,400? Or, more precisely, shelter them from a fine of that amount. That’s how much OSHA recently fined Mollett Welding and Mine Service, a welding and machine shop in West Virginia, for exposing workers to safety and health hazards.

Among the violations were such things as failure to:

  • Provide clean, orderly places of employment;
  • Evaluate and identify respiratory hazards;
  • Conduct a personal protective equipment hazard assessment;
  • Ensure employees wore eye protection when exposed to metal shavings;
  • Post “no smoking” signs; and
  • Ensure fire extinguishers were mounted, readily accessible and fully charged.

These are only a few of the 25 violations that the company faced. I picked out these specific violations because they are things their gases and welding distributor salesperson—or even a delivery route driver, in some cases—might be able to identify and help the customer correct. You don’t need to conduct a full-scale audit to discover these violations—many can be observed visually.

This business is about relationships—and helping customers deal with regulations can certainly go a long way toward building those relationships (Think of it as a value-add!). When you can help customers lighten the burden of regulations, you can bet they will be more loyal.

And along with saving the customer some money, many of the solutions to these violations call for products that gases and welding distributors sell, like PPE and welding fume removal systems. With a glance around your customer’s workplace, you might actually make a sale in the process of saving your customer from OSHA.

Just think: if you can save your customer $59,000, how much more would they be willing to spend with you?

The Price Drop Dilemma

Thursday, December 2nd, 2010

As I was reading an article in Inc. Magazine called, “Go Ahead, Raise Your Business’s Prices,” it brought to mind a dilemma that many GAWDA members have been talking about: customers only want the lowest price.

In the magazine article, author Jason Fried, co-founder of software firm 37signals, talks about the backlash of angry customers when his company decided to charge $9.99 for an iPad application. Nowadays, customers expect apps to be free or a nominal fee of $.99, but never more than, say, $1.99. Fried says, “We think free is a business cancer.”

So instead, Fried made the decision to charge ten times its competitors, and his justification makes perfect sense. “We wanted fewer customers to buy [our software].” At a lower cost, he says, his company of 20 employees could never provide good service and support to the masses. Instead of making $20,000 from 20,000 customers and provide poor service, he says it’s preferable to make $20,000 from 2,000 customers and provide good service.

The important thing is that Fried had the guts to stand by his price. Some customers will walk away. Many customers will complain. But, as Fried shows, the “right” kinds of customers will stay, because they recognize the value of the service. While software is a whole different game from gases and welding, the issue of price is a common concern.

What does your company do to combat customers who demand low prices? Would you do what Fried did? Let me know by leaving a comment.

Also, take a look back at our “Family Business Challenge” where we asked 10 GAWDA members what they would do if a customer asks them for a discount.

Cylinder Tracking As A Selling Point

Friday, October 1st, 2010

So many cylinders, so little time.Today was quite possibly one of the single most educational days since I have been writing about the gases and welding industry. Several of us here at Welding & Gases Today journeyed over to GAWDA member Haun Welding Supply, located in Syracuse, NY, where Wayne Brownson led us on a nearly two-and-a-half hour tour. (There was just that much to see!) This was the first time I had been to a fill plant, and I came away very impressed with what I saw.

Haun Welding Supply is in the process of building a new state-of-the-art, automated fill plant at their headquarters—I can’t wait to check it out when it’s finished. While we were talking cylinders, I asked him about their cylinder tracking. Wayne’s eyes lit up as he told me that I was looking at “the original cylinder tracker.”

The company tracked cylinders from very early on using a card filing system, before the system went computerized in 1979. At that point, cylinder serial numbers were entered by hand. By 1991, Haun was using bar code tracking, which helped to eliminate the occasional typographical error. Only a few years later, around 1994, they adopted RFID tracking, and have continuously honed their methods ever since.

Apart from the obvious benefits—losing fewer cylinders and creating customer accountability—Wayne explained an additional benefit I had never thought of: cylinder tracking as a selling point. He told us of one specific example of when he convinced a customer to use Haun’s gases for a large construction project because they could track the cylinders. The customer bought in, and when the project was done, 20 cylinders were still missing.

Little by little, more than a dozen were returned by individuals, some who didn’t know where they came from. Without tracking, Haun would never have known the cylinders were from that customer’s project. The customer didn’t know what to do when they received a credit for the returned cylinders—they were so used to being billed by other companies instead of credited.

Talk about leaving a good impression. Not only did cylinder tracking add value on a service level, it literally saved the customer money. You know that customer is going to come back to do repeat business.