Meet Major Customer Requirements
Meet Major Customer Requirements
The Challenge: Our client supplies a major technological component to its largest customer in a relationship that involves numerous other products and spans three continents. While there were many positive dimensions to this strategic account, the spotlight was unfortunately focused on the price of the supplier’s technological component. Margins were declining as a result of this focus, and the customer was resisting new concepts and technological innovations.
Assessment: Blue Canyon spent considerable time developing insights into the markets served by our client and their customer, and was able to identify several significant unmet needs that were not being addressed. These insights emerged from an in-depth investigation of several stages far along a long-complex customer chain that began with our client and their major customer. Working with our client, we developed prospective responses to these needs, augmenting these ideas with a strong business case explaining how our client and their major customer could achieve a significant success by targeting these opportunities.
Strategic Solution: Our client took their ideas to their major customer, and spent time sharing with them the insights and origins of the ideas that had been developed. After several interactions, the two firms agreed upon a game plan to collaborate and pursue the new opportunities. Our client also introduced several strategic concepts that had emerged from our work with them. One such idea involved a new concept that had the potential for a significant cost reduction, allowing both firms to realize higher margins even in the face of ongoing price pressures in their markets. A second concept which this supplier brought to their customer offered the potential for a price reduction in exchange for actions that allowed our client to reduce the variants in the product lines which it was supplying this customer.
Results: The focus of the relationship has shifted. New growth opportunities and opportunities for collaboration to improve margins are now the main points on which the two firms interact, rather than on price alone.
For more information on this topic, please visit the Major Customer Strategy and Relationship Management section of our Publications page.