How can businesses navigate uncertainty?
During times of uncertainty, whether it’s a global pandemic or the rapid rising of costs that we are currently experiencing, cash flow is the key to any positive business. If you operate a business that sells physical goods, there are a number of tactics you can use to help maximize your cash flow. The first is to think about the way your customers pay for goods. Reducing payment terms to minimize the gap between goods dispatch and payment being received is a good place to start, but can be a source of frustration to some customers.
Another way to solve this problem is to incentivize customers to pay in advance for their goods by offering a small discount in return for early payment. This provides benefits for both parties and is a more positive way of framing the conversation with your customers. Finally, make sure to continually review your inventory. If you have slow moving, excess or obsolete products in your inventory, finding a release valve for them is a tremendous help for your cash flow.
How did the global pandemic impact supply businesses and what does the future look like for them?
The global pandemic presented challenges for everybody, but the impact on global logistics was particularly severe. Almost overnight it became very tricky to move things around the world and some trade routes saw a cost increase of three times the normal price. For businesses that handle inventory themselves, the challenge was effectively doubled because not only did they have to make sure they received suitable levels of stock, but they also had to ensure that orders reached their customers in reasonable timeframes.
As we continue to emerge from the global pandemic, the pressure has not eased on inventory based businesses. They now face new challenges in the form of demand and cost inflation. With many customers becoming increasingly careful about where they spend money, demand has increased for everyday essential items but stalled somewhat on higher value purchases. To find success in this period of uncertainty, inventory businesses will need to work very closely with their key customers to understand what their demand is likely to look like over the next year. By planning ahead collaboratively, inventory businesses will be able to create flexibility in their supply chain to continue serving their key customers.
What is the secret to a great supplier-buyer relationship?
Maintaining successful relationships with B2C customers is more involved than ever before. The traditional relationship of simply providing a numbers-focused report on progress and results is changing to more of a trusted advisor relationship. Alongside the numbers, suppliers are providing insights and analysis that empower their customers to make reliable decisions. To do this successfully, suppliers need to have a deep, holistic understanding of the businesses that their customers run.
If you are a supplier that is looking to strengthen your relationship with customers, the best area to start offering insight on is profitability. Showing your customers that you understand which products sell best in different markets is the first step. But to really add value, show your customers where they are losing money and what they can do to turn the situation around. Helping your customers show where they need to invest and where they might need to make some hard decisions progresses from the relationship simply being transactional and ultimately will help you to retain them as a customer for longer.
Fiskars Group is the global home of design-driven brands for indoor and outdoor living. Their brands include Fiskars, Gerber, Iittala, Royal Copenhagen, Moomin by Arabia, Waterford, and Wedgwood, among others. Everybody at Fiskars is driven by a common purpose: pioneering design to make the everyday extraordinary. Since 1649, they have designed products of timeless, purposeful, and functional beauty, while driving innovation and sustainable growth.