As both parties emerged from the sales slump of the 2008 recession and took a few breaths, the discounters started to take hold. Should Aldi continue its market share gains, it will not only have overtaken Waitrose, but in five years, they’ll have a greater market share than Morrisons.
The risk for the suppliers, and particularly those that are much smaller than the retailers, is even tougher. According to top accountancy firm Moore Stephens the number of food production companies which entered into insolvency increased by 28% last year. This is against a backdrop of liquidations falling for the previous five years.
Duncan Swift, partner with the firm warns of suppliers being used as “cannon fodder” and talks of “banker-style trading floors”. Whatever the tactics, it is more imperative than ever for suppliers to create less ‘Queen-like’ visits and more ‘Sugar-like’ visits.
So, here are five tips to help prepare more effective factory visits. They are: decide what you are trying to achieve, make the best use of the time that you have, decide whether or not to skip the factory tour?, ban Powerpoint and negotiate the deal you need.
Deciding what are you exactly trying to achieve may sound obvious. But in our experience of working with suppliers over the last decade, tying-down exactly what you want to achieve is critical and rarely done. Yes, more business, yes, solve issues ABC, but what exactly can you get agreed and done on the day.
Objectives fall into two camps, those that can be agreed on the day and those where you are laying the foundations for the future. List the items in two columns with exactly what you want to achieve. Then get the team to buy into achieving those objectives in everything that is prepared.
Making the best use of the time covers breaking down the day into ‘sessions’, with each session having an objective, a format. That may be a group discussion or presentation and be clear about the outcome you want to achieve. This should be created like the script of a play and distributed to the team. Have a contingency plan for late arrivals, or sessions running over rather than, ‘We’ll just talk faster’.
Should you skip the factory tour? It’s an odd thing to say given the assessors have driven all the way, but if the objectives don’t require a factory tour, don’t do it. There is a feeling that the factory tour helps the buyer visualise the supplier, and gain empathy, but beyond this, what are you trying to achieve with a factory tour? Looking back on hundreds of factory tours, some were interesting, but little else.
Ban Powerpoint. Used well, it can be very effective. Unfortunately many people use it like a drunk uses a lamppost, for support, rather than illumination. The risk with Powerpoint is threefold: first people. People want to create large decks to show all that they know. Second, as soon as someone stands up, everyone stops talking. Third, they take a long time to present.
The day’s objectives should be defined, the objectives for each session are defined. Challenge the team to achieve their session objective without using Powerpoint. If the team wants a discussion, a one pager is an excellent format, if they want a decision, three options written on a flipchart is enough.
Negotiate the deal you need. Issues that need resolving may need to be negotiated and this is obviously where the team needs to be at their very best. Role-play is the most under-valued learning tool for negotiation. It will help you identify blind spots and avoid you bleeding in battle because you have sweat in training. Identify the issues that are likely to be negotiated and role-play with colleagues, always with the aim of achieving a win:win.
- Darren Smith, founder of Making Business Matter (MBM) spent 12 years as a category manager for one of the big four UK supermarkets and now manages the MBM consultancy – a training provider specialising in sales and marketing teams of suppliers to the big four UK supermarkets.
Five tips to plan more effective factory visits
- Decide what you are trying to achieve
- Make the best use of the time that you have
- Skip the factory tour?
- Ban Powerpoint
- Negotiate the deal you need