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In Lab - Archive

02/05/2013
RELATIONSHIPS AND BUYING

THE CURRENT MARKET SITUATION invites reflection. Consumer crises and the slump in family spending, political uncertainty that is the harbinger of growing interest rates, general uncertainty and concerns about the future are joined by business management that is affected by the choices that every tyre specialist must periodically make.
First of all the relationship with suppliers and their representatives. This relationship must be analysed from two points of view. The first concerns suppliers in the real meaning of the word. Having a lot of them might not be ideal. From orders to invoices, from discounts and conditions to be checked to the analysis of the results actually achieved with sell out to end consumers. Then you have to take into account the ones with whom you have a contract and a specific buying programme, with manufacturers especially. In general, requests tend to reach 50% of sell out, if not more if you are part of a loyalty network.
Then, rightly, you must have other suppliers, distributors in general, with whom you are in touch every day for buying other brands requested by or suggested to customers. This means that keeping large stocks is not necessary. With the manufacturer I get support and services, with the distributor you work on the price and speed of the logistics service.  So good management means having choices in the field.
Certainly for costs and timescales downstream of buying as a function of sales, and continually chasing after the lowest price, which means margins or, if you prefer, mark up. And that means opting for a non-professional positioning rather than service, outlet and price, which must correspond to an average daily number of customers that is very, very high to justify all the rest.
The second aspect is relationships with representatives or suppliers. Their aim is and always will be to generate volumes and sales for the manufacturer or distributor. Sales in terms of sell in to specialists requires considerable specific professionalism and ability to integrate the level of service, but above all it requires an aptitude for commercial relationships. Demonstrating historical purchases and the average for the area on your PC does not help much if you don’t try to find out why there is a problem, what has caused it, and how to resolve it. The commercial strength of a supplier lies primarily in helping to increase sell out and not sell in.
In conclusion, a supplier’s offer always has a positioning, economical and service rules, IT tools and platforms on which to place orders. It is up to every specialist to make the choices and decisions that are the most consistent with the local market, the types of regular and potential customers, vehicle types and the sizes that are most sold, but also interior resources for ordinary business management and operation.
It may seem as though the things to be done are always the same, but this is not so. Outside our shop everything is changing. The Internet is used by 29 million Italians, 85% of whom are registered with at least one social network, where they ask about opinions and experiences even in the world of tyres.
Reality is the way it is and not the way we want it to be. So to respond to the reference market and customers in the best way possible, relationships and purchases are a critical factor for choice and success.


Cesare Soresina
PR3 Consulting &Partnership
c.soresina@pr3consulting.it

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