Wednesday, July 31, 2019
Breadth of product offering can be overrated, especially if mismanaged, says Steve Hutin, the managing director of Rope and Sling Specialists Ltd.
I hear about a lot of product launches in my sector and an equal volume of diversification or expansion programmes. Companies see adding a new item to their portfolio, or branching into a different sector, as exciting and lucrative. And they’re right, in principle, but too many firms get the process wrong and underestimate what it takes to successfully widen an offering from nuts to bolts to screws to fixings to hand-tools. Many misconstrue the process to such an extent, it proves their downfall; the new range fails or the core business subsides.
When I took ownership of my company in 2006 (time flies!) our product portfolio was limited. Worse, shelves were bare and stock was non-existent. I’d identified the potential of the company but executing the growth plan hinged entirely on adding more products to the range—triumphantly. And that’s an important point to emphasise; it’s easy to source equipment and put it in a catalogue, but people have got to buy it, speak fondly of the process, and come back for more. It wasn’t a case of printing a catalogue with every product in this sector and the next plastered across its pages.
I knew the business was accustomed to placing orders for, say, 20 1t, 1m slings. I was also aware that we needed to reshape the model and was soon placing orders for 1,000 units at a time. Strategy was important throughout the process just as it is today. We recognise, for example, that in South Wales our focus was steel professionals, while in London, those working in infrastructure and construction require different product and support to our offshore contacts in Scotland and more varied community in Rotherham.
At your service
Any expansion or diversification plan has got to be backed by value to the customer and top-class service. Otherwise it’s all hot air and doomed to fail. Price points have to be sensible but the whole thing revolves around service and a supplier’s ability to back-up what they suggest they’re going to do. A photo of a shiny hoist in a brochure gives the illusion to a buyer that the company has the unit available for delivery today, and can support it with product knowledge and after-sales support. Buyers can find out the hard way that this isn’t always the case.
A red flag I look for when perusing the wares of a company, especially in a paper document or online format, is a huge diversity of kit. I wonder how any small and medium-sized enterprise (SME) can not only stock so much equipment, but also support it with the necessary structures. Think about the training and competence that is required even in the below-the-hook or rigging sector. How then can one single firm boast the necessary expertise to supply every product in use on a construction site at any given time? They can’t. It goes back to the Lifting for Lifting mantra that we promote frequently on social media platforms.
Thus, when we take expansion steps, we isolate the lifting and height safety markets. It’s about implementing a growth strategy that might start with a new product but nothing is put to market until the relevant training—DBI-Sala 8mm permanent horizontal lifeline system course, for instance—has been conducted. Consider the damage it can do to a business if a customer orders a product and it isn’t available, or is subject to a six-week lead time—and then there’s nobody readily available to answer application or safe-use questions.
As many of you would have seen, we’ve recently unveiled a partnership with JD Neuhaus to distribute its new range of Mini Next Gen air hoists to the UK market, which serves as a case in point. Yes, the process started by identifying the product range and then reaching a mutually beneficial agreement with Steve Walker, managing director at JDN UK Ltd. But, importantly, it ignited a lengthy, education-centric process, which will remain ongoing even as the first batch of equipment arrives in mid-September.
As I blogged about last time, Steve and I were among a UK delegation that visited JDN USA’s offices in Baltimore, Maryland in June to mark the launch of the Mini range to the North American marketplace. Also present was Sean Maslen, a regional sales manager here at RSS. Extensive product training was just one facet of the meeting, as stateside distributors also participated throughout the week. The initiative cost time and money but it was worth every second and every penny because we’re now so much better versed on the range, which is expertise we can feedback to customers over the coming months.
Even at the time of writing, we’ve just completed additional training at our Warrington facility, where representatives from all six UK depots participated. Again, this represented time away from the day job and a great investment of everyone’s resources, but this is what it takes to successfully on-board a product. And we won’t stop there; in due course a delegation will travel to Germany for further training at the manufacturing facility where the full range of pneumatic and hydraulic hoists, crane systems, and components is made, principally for use in extreme environments. In fact, we’ll never be ‘finished’ reinforcing what’s in the catalogue with world-class knowledge.
If you’re a provider, don’t add anything to your product range lightly. And if you’re a buyer, challenge your suppliers to offer the best possible value and service. Conducting due diligence now is more efficient than troubleshooting later.
Rope and Sling Specialists Ltd