Tag Archives: services

  • 0
commodity services

Commodity Services And The Race To The Bottom

Tags : 

Everyone wants a good price. In fact, everyone wants the best price. It is seldom that someone wants to spend more than their neighbor or competition for a similar product or service. Have you ever felt like commodity services are really a race to the bottom?

Price Strategy

Many selling efforts consider the basic economics of price. Sell more at a lower price and we’ll get more money. Sometimes this may make sense.

Selling services has some differences when compared with selling raw materials or products. The value of the product is in the spec. Anything meeting spec may only come down to one thing, price.

Services have some differences. Businesses that treat services like raw materials or products, pushing vendors for the lowest price as compared to spec, may get less than they expected.

Race to the Bottom

When you are selling a service that is based purely on spec you may be selling commodity services. Yet your value will be judged on the expected quality.

It will need to meet spec which includes quality, but the quality of a service subjective.

This is even true for most jobs. When you negotiate a salary, it typically starts with spec. Ultimately though you will not only be evaluated compared with spec but your performance will be compared with price.

One of the challenges for the service provider is to apply enough margin to consistently exceed expectations.

While everyone is racing to the lowest price and trying to sell more, the intuitive path seems to include cutting operating costs to keep margins. Service quality often declines. Promises are broken.

Commodity Services

One trouble spot with services is that they often aren’t remembered for price. They are remembered for the feeling after the service.

The best lawyers, surgeons, and accountants may have to meet spec, but spec isn’t that relative to price. The service promise and the resulting expectations have more relevance.

If you were in trouble legally, would you hire the cheapest attorney? The spec may be, have the credentials to practice law. The promise is to keep you out of jail.

Here is a promise. The cheapest service may meet spec, but it will often be remembered as an inferior product.

A race to the bottom.

-DEG

Dennis E. Gilbert is a business consultant, speaker (CSPTM), and corporate trainer. He is a five-time author and the founder of Appreciative Strategies, LLC. His business focuses on positive human performance improvement solutions through Appreciative Strategies®. Reach him through his website at Dennis-Gilbert.com or by calling +1 646.546.5553.

Dennis Gilbert on Google+


  • -
all in sales appreciative strategies

This Is Why We Are All In Sales

Tags : 

Professionally holding a position in sales is an admirable career. However, many people suggest that the sales role is not for them. They might scoff at the idea of a position in sales, yet they are often envious of the paycheck. Are we all in sales?

Nearly thirty years ago, I held a position in information technology. I wrote code, fixed program bugs, and served as an expert with voice and data communications. That was a long time ago. Although it might not seem apparent, I was also in sales.

Not formally perhaps, but I had to sell my ideas, sell software enhancements and sell hardware upgrades. The type of business I worked for was known as a mail order company. Today it might be a dot com and as such, selling was important.

Commission, not salary, compensated formal sales positions and it was challenging but often rewarding work.

Perceptions of Job Roles

I can still recall a conversation with one of the top salespersons who challenged me one day in the hallway. He approached me about some problem or difficulty he was having and we had a very mild difference of opinion. As our short conversation was winding down he said, “Why am I asking you. You don’t know anything about sales.”

It wasn’t intended to be polite. The intention was a direct hit. The concept was to knock me down, push me back, and insult me professionally. It didn’t work.

My simple response was, “I sell every day.”  He came back with, “Yeah, how?”

We Are All In Sales

Recently I had convinced the board of investors to make this business unit the data center for the six other business units they operated. Just a few days earlier, they had announced this change at an all company meeting.

The investment in computer hardware upgrades exceeded $400k and the opportunity that this brought to our location was huge.

Therefore, my response was, “Well, I just sold a $400,000 computer system to our investors.”

Unsure of what to say next, my assailant just huffed and walked away.

Most of us are in sales, not always formally, often informally. We still sell ourselves, sell our ideas, and sometimes actually sell products or services.

Do you think we’re all in sales?

What are you selling?

– DEG

Dennis E. Gilbert is a business consultant, speaker (CSPTM), and corporate trainer that specializes in helping businesses and individuals accelerate their leadership, their team, and their success. He is a four-time author and some of his work includes, Forgotten Respect, Navigating A Multigenerational Workforce and Pivot and Accelerate, The Next Move Is Yours! Reach him through his website at Dennis-Gilbert.com or by calling +1 646.546.5553.

Dennis Gilbert on Google+


Search This Website

Subscribe to Blog via Email

Enter your email address to subscribe to this blog and receive notifications of new posts by email.

Upcoming Public Events

  1. Managers Toolbox Event – Williamsport

    October 2 @ 8:00 am - 5:00 pm
  2. Developing Middle Managers : Part 1

    October 16 @ 8:00 am - October 18 @ 5:00 pm
  3. Bridging the Gap Event

    October 24 @ 8:30 am - 4:00 pm

Blog (Filter) Categories

Follow me on Twitter

Assessment Services and Tools

Strategic, Competency, or Needs Assessments, DiSC Assessments, 360 Feedback, and more. Learn more