How are your price increase conversations going?

Price rises are everywhere at the moment. How are your price increase conversations going?

Data builds the trust and therefore the relationship

When everything is about price that’s a tricky conversation, but when it’s about Insight you’ve got some substance and more chance of getting a fair price rise.

When people talk about Insight or Data or Management Information or the business hot topic ‘Big Data’, they often link this to technology and efficiency. This makes perfect sense as it’s software (technology) that captures data, for example: a maintenance company relies on its service management system to capture data on customers, contracts, assets, maintenance schedules, parts, job sheets, compliance tests and more. Then Managers use this data to identify where operational efficiencies can be achieved.

But when it comes to price rises it’s the insight from good data that can make or break those tricky conversation with your customer. Companies that share insight with customers over time can build effective relationships by sharing useful information. When you can pin-point problems and share them with customers you can work together more effectively. This could be as simple as sharing information on problem assets causing repeat call outs, honest conversations about overhaul and asset renewal dates, changes to preventative maintenance routines to limit costly breakdowns creates gives suppliers and customers an opportunity to work better together for mutual gain.

Furthermore, regular useful data reports over time mean there’s no surprises when it comes to price conversations because customers know if you’ve had to over service assets, provide more parts, make more journeys.

When your competitors knock on the door to undercut your recent price increase they have the data to really know if the other (cheaper) quote will deliver the service they need for their problem assets and they will be basing decisions on multiple factors not just price, because they have this information and insight – because you gave it to them and they’re working on improving it with you.

So good data gives insight, no big deal, but when it comes to price increases, a necessary evil at present, you want to make these as painless as possible and beyond the inflation discussion, it’s all about the data. Only with the data to back it up can you show the required maintenance levels to maintain uptime, the changes customers may need to make and the efficiencies you’ve already made, all helping you maintain and increase profitability.

Capturing and providing good data is about more than technology and efficiency it empowers you to have useful conversations with customers and build trust – and that’s what long-lasting business is all about.

You’ve got some large lucrative contracts, but certain depots / assets are causing you multiple call outs, more engineering time and more parts than you expected so the reality is profitability is decreasing at a time when prices are rising. Wouldn’t it be better if you could pinpoint this, talk to customers about it, highlight how they can help, limit parts included in the contract or many other solutions? Of course it would help but without the data this just looks like a big contract that’s got to make money, even though it doesn’t.

If you’re giving data that is accurate, and if you trust the data you’re giving, then you’re building trust with the customer. You can also give them interesting insight and recommendations for improvement, which you can’t do with a job sheet alone.

What you need to be doing is giving your customers value added insight. If you can only give basic info, then the conversation is fixed solely on price. Instead, you need to have open and honest conversations with your customers that are backed up by your data. This is what builds trust with customers. Gone are the days where you could scrape by with just your salespeople going to your customers and having a cup of tea- now you need to have meaningful conversations, and the best companies are already offering meaningful data, so you should be too.

Let’s say one of your customer’s contracts is coming up for renewal- if another company says they’ll do it for 10% less, what reason do your customers have to stay with your company? You need to have a reason to keep them, and you can’t just rely on good engineers.

If you have the data to back up the value you’re adding, it can make all the difference. For example, you can give insight on which assets are performing or failing. If you’re servicing them at the right time they aren’t breaking down, instead of them failing in the middle of a job. You can give your customer the data to show that you’re adding value, which will make a difference.

At the end of the day, things are different now, and customers expect more than your basic service, so what else do you provide?