Customer Diversification – Expanding Your Customer Base

Leaders at our September Round Tables discussed ideas for diversifying and expanding their customer base. Discussions this month were productive, resulting in useful ideas to consider for expanding your customer base. Diversification is key not only for the survival of your business, but it allows you to choose customers without compromising your values. 

Seek Him First
‘Seek first the Kingdom of God and his righteousness and these things will be added to you.’  Matthew 6:33. There may be a market that we are not seeing, and we may need God’s wisdom to open our eyes. Often, we rely on tactics and strategies. He extends into your business, just like He extends into the Church and family.

In CBRT, we encourage people to seek the Lord to give us the customers that he wants us to serve and help prosper so that we are working his kingdom plan.  When one of our business leaders get an opportunity for a proposal, they pray:
‘Lord, open this door or close this door, and if you open this door, we will trust that we will have what we need, the resources, the creativity to successfully serve this client.’

Begin by asking Him.

Expanding into New Lines of Business
One Round Table (RT) member’s business for 20 years was assisting businesses in getting R&D credits, but switched to the Employee Retention Credits, due to covid.  This has expanded the company’s reach into other networking circles, and other industries. This has led to 3^rd party referral sources for new business. It has become the main source of business for his company. This move has paid off in dividends. Leadership now has an openness to try new things and hope for the future.

Strategic Referrals
One RT member looked at his staff, and asked, how do we maximize the talents and skills of employees? He then modified company offerings accordingly. His company was asked to do certain types of work, outside the skill set of his team. They found strategic referral partners to perform that work and received a percentage of the closed deals, bringing in supplemental income. This process did not divert from offerings, did not divert staff, but it did offer opportunities to close sales, and generate additional revenue.

Keep Current Customers by Providing Value
Productivity equals output divided by inputs. A leader’s job is to convert inputs to outputs, or value contributions. Outputs are deliverables and the value contribution to the customer. Ask, what are the resources (employees, software) available to deliver the output?

One RT chair creates a matrix with resources down one side, and outcomes along the top side. He then connects resources to outcomes of value. Looking at the output side, or product value contribution, if there is demand, and you do not have the resources to produce the output, reallocate resources as quickly as possible.

In manufacturing, speed is key. Do whatever is necessary to convert resources into outcomes, or cash. If you have a job that requires skills you do not have, hire, or contract them out, and convert inputs into value contributions for the customer. This will help you survive in this time.

Ask:  How do I maximize the team and get the highest level of output from each team member? This question helps identify a potential skills gap.

Analyze business to find gaps where resources are underutilized. Make a list of your genius. Are you using all the resources in yourself? Each of us have so many talents we are not using. Also, look at the genius of your people. You will find they have skills, connections, and knowledge that you are not taking advantage of.

Choose the Right Market
There are markets, products, and the customer. The nature of each one is different. They cross to find your target. You can find a market with a good side and a bad side. For example, in the legal profession, there are divorce lawyers and business attorneys, with a completely different nature of customer and completely different product. Ask yourself, what market am I in? What products am I delivering in that market? Are they bringing me joy? Or virtue? 

Selection of Customers
One leader asked whether the selection of customers effect the virtuous performance of the team? Is the opposite true as well? In other words, if the customer selection is not ideal, can it drag the morale and focus of your team in the wrong direction?

All of us over time have experienced a time when we had to quit a customer because you did not like the way they treated you, your employees, or their staff.

One RT leader had to quit their best customer, because the marketing director was horrid, draining and demanding, accusing and adversarial. It was a tough decision, but once they let them go, the energy of their company completely changed for the better.

Go Deeper with Your Customers
If we really take care of our current customers, we can expand business by cross selling our services. It costs more to get a new customer than to keep a customer. One leader confessed that in the past when they provided a service to a client, they would call them after several years had passed. Now, they have a program where they call customers regularly to see how their implementations are going, and to see if they need additional services. They can generate new business by keeping in touch with customers.

Contact those you may not like as well as the ones you do.

Recommended listening:  Acres of Diamonds.  https://www.youtube.com/watch?v=VU00E-vwxsw. It is an audio recording with stories of people looking for gold, when they had minerals on their land, or talents within them. Ask the Lord, what are the diamonds I am sitting on? Then look at the stack of business cards on your desk.

It’s Who You Know.  Making Connections through Industry Networking, Conferences and Associations
A RT leader consulted on quality improvement with a manufacturer. He conducted conferences for their suppliers to set the quality requirements and taught the fundamentals of quality improvement, corrective action reporting, etc. Then the suppliers would hire the leader to make sure they met the quality requirements to continue to work with the manufacturer.

One RT member created an advisory Board for his consulting business. When submitting proposals for new business, he advertised his board of advisors. It became an implied referral and a powerful way to gain new clients.

Consider offering training to industry associations as a commitment to be a resource for them. Then teach to gain connections, referrals, and clients. Be willing to serve and business will flow from there. 

For Business to Customer Manufacturing
Our Seattle based RT member introduced a Seattle based company Coupang.  This company has created a simple method to connect American manufacturers to potential customers in Korea. It is the equivalent of Amazon in Korea.

Upcoming Events:

1. Rich Wolowski, President & CEO of Gordon Foods will be the keynote speaker at our Kalamazoo Breakfast Social on Friday, October 21 at 7:00-9:00am. at the Kalamazoo Country Club.

2. Jeff Disher, Founder and Board Chair of Disher Corporation will be the Keynote speaker at our Grand Rapids Breakfast Social on Friday, November 18 at 7:00-9:00 am. at the University Club in Grand Rapids.