Marketing strategies for small manufacturers
Don’t get tripped up by marketing myths. Use these customized techniques to build a successful marketing plan.
Good business-to-business marketing calls for a customer-focused approach that uses your limited resources wisely. Unfortunately, several marketing myths obscure the importance of finding your best customers and determining what they need. By avoiding these myths, you can build a sound marketing plan based on principles that are effective for small manufacturers.
Four marketing myths
Michael Collins, author of the book “The Manufacturer’s Guide to Business Marketing,” has found four marketing myths that lead small manufacturers down an unprofitable path.
Higher sales equals higher profits. All sales are not necessarily profitable. If your manufacturing or sales costs are too high, you could be losing money with each sale. More sales just multiply your losses. You may also have quality and service problems. Higher sales will only worsen these problems and add more costs.
Seven steps to better marketing and sales
To help avoid these myths, follow these marketing principles designed for small manufacturers.
Determine your most valuable customers and products. Which customers and products are your moneymakers? To find out, calculate your contribution margin for each product. This is sales minus variable costs, such as materials, sales commissions, and shipping. Sort contribution margin from highest to lowest. You’ll quickly see which customers and products yield the most cash for paying fixed costs and generating profits.
· A projected income statement for next year
· Measurable goals and objectives
· An account list that includes an analysis of your most valuable customers
· Market analysis of customers, competition, market trends and niches, and sales potential
· Marketing strategies, including a sales and distribution plan, pricing, promotion, and customer service
· An action plan that includes timelines and responsibilities
If you would like more information on this subject, Michael Collins will be conducting a special, pre-conference workshop on “Developing Your Strategic Focus in the Marketplace”, May 18th, 1-5 pm in Milwaukee. His book, The Manufacturer’s Guide to Business Marketing, is the first to address marketing and strategic issues for small manufacturers. Take advantage of Mr. Collins’ valuable expertise and attend this insightful session. Please visit www.manufacturingmatters.org to register or call 877-800-2085.
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WMEP provides technical expertise and hands-on implementation assistance to small and midsize manufacturing firms on advanced manufacturing technologies and business practices including lean manufacturing, ISO, value chain management, and strategic repositioning services for manufacturers and manufacturing facilities located in Wisconsin.
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