Industrial Marketing Can Increase Profits and Decrease Expenses
What is Industrial Marketing?
Industrial Marketing is more commonly referred to as B2B, or business to business marketing. When a business purchases from another business there is considerable cost savings. An example would be Business A sells to Business B in large quantity at wholesale, thereby reducing the cost of business for both parties. Business A is able to sell their product directly to a buyer without the need of extra advertising. Business B is able to purchase at below retail.
Another cost savings is with regards to invoicing. Rather than go to a retail store to purchase a necessary item, also known as cash on demand, the business can be sent an invoice. Invoice payment will generally include a minimum of a 10 day grace period, possibly as much as 30-60 days. In some cases quarterly payments can be made. Some business will also give a discount if the invoice is paid early. These discounts can be as high as 5 or 10 percent.
How to Implement Industrial Marketing
Business’s can effectively implement B2B, or industrial marketing, by reviewing their purchasing needs. Once they have reviewed these needs research needs to be done by finding the companies that supply the products that the company needs. A key factor in this research needs to be quality. A company should never sacrifice quality for price. When quality is sacrificed, customer and employees can become dissatisfied, this will hurt the bottom line.
Another good move would be to secure bids or estimates for products the company wishes to purchase. A price guarantee is a good thing to watch for. Fine print must be read to insure that there are no contractual obligations that must be met in order to secure the promised pricing arrangements.
Final delivery needs to be considered. If your company has adequate equipment, docking or storage areas to receive and purchase large quantities of items that your company will use, another significant cost savings can be reached. One factor to remember when purchasing in large quantities is that some items need to be stored in temperature or humidity controlled environments.
How to Use Industrial Marketing
When it comes to the receiving side of industrial marketing, a major point to consider is to make sure that you are purchasing from a direct supplier, and not just a middle man that is connecting you to the business you are seeking. These deals can be crowded with quite a bit of extra financial obligation and can lead to receipt of inferior or inconsistent products.
With the addition of the Internet for research, both B2B transactions and research are considerably easier, however this is not a guarantee that the company you are looking for will be on the Internet. Some companies that market only to other companies may not be on the Internet. In this case, the company would need to do some word of mouth research. Contact others in your line of work, or people that have moved on from your company that you can trust.
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