KYC: Know Your Competition

Have you ever done KYC for your sales aspect? KYC is “Know Your Competition” and yes, as taken most popularly, it is also read as “Know Your Client.” Knowing your client is the first step towards being serious about any sales aspect. And ‘knowing your competition’ is the biggest turning point of all the sales game.

Sales have a unique nature, it not only depends on how good you are, but also on which competition you choose to fight with. The market always seems to be open but actually, it is not that open. There are few invisible lines drawn in every sales aspect. This line defines the nature and behavior of the Client. “Approved Makes” is one of those invisible lines.

A few days back, I was analyzing a tender. I was particular about lighting requirements. The client has got specified about 6-7 makes (which I personally feel on the higher side). Logic was simple, more the competition – better the prices. But it is not a true story, the wrong brand in the make list lowers the quality of purchase. But this is the story of a purchaser (Client), which will discuss in some other blog.  What I am intended to focus on is the suppliers/Manufacturer.

If you represent a brand and you are present among the approved makes, then you may be happy about possible participation. But it may also happen that your name was mentioned in the “make list” not because of you or your brand. Your competitor might have placed your name on the list. The most obvious reason for this would be placing their low quality (with low cost) product with your high-cost items, which will make them win by being L1 (Lowest Bidder).

So, many times you are a victim but still, you fail to understand and make a supporting quote. Such sales aspects are never yours and you will be wasting your time with such cases. The sales projections based on such cases are destined to fail. In nutshell, you are being played by your competition.

The story beyond L1 (Lowest One)

Be it government project or Private project, L1 always have the highest possibility of getting the order. If the model and technicalities of products are approved by the technical team then commercial persons will go for L1. Once the product has cleared the technical window, there is nothing much in hand of a salesperson, except throwing prices.

A good salesperson work on specification. They create a technical window for other companies. And not only this, they chose their competition. However, this is a very tough task and that’s why a salesperson can be called a good salesperson. This stage can be achieved by technical knowledge and communication skill with the backup of a good product. It is not a short-term approach but a mid-term or long-term approach. Usually, the salesperson doesn’t have this much patience and end-up with the price war.

There is a very popular term in sales line and that is a 360-degree approach. Means meeting and engaging all the stakeholders in decision making. This is a natural approach for process following person but a time-consuming thing. Needless to say that the conversion ratio (or strike rate) is very high in this case. Also, it requires a team approach.

Competition: Action & Reaction

Assuming competition on losing side is probably the biggest mistake. Your competition may pretend to be sleeping but actually, they may be busy in digging tunnel to steal your order. You have to be one step ahead. Yes, completion will give you reaction, but in sales industry, the company who is reacting is normally losing (Learning in the past years). For example, ‘X’ company was very active with the client who was looking some lighting requirement. They suggested to buy a 90 CRI product which may be unusual for competition ‘Y’. Now till the time Y will arrange the similar product, X will be in next round of discussion. But it may also be possible that, Y comes with some of their unique capabilities. In such cases, if X is not aware of the competition strength, then this reaction will hit them strongly.  But if X is aware and have already made a pre-action on that then they will always be in leading position.

Knowing the strength and weakness of competition is very important. Also getting regular updates new addition in the range, price trends, market movement and winnings of competition should be known to an alert and effective salesperson.

Placing the right competition and their right product is very important. For an example, XIAOMI and APPLE both are a mobile manufacturer and both are good companies. Their products are having their own strength and weakness. And the user may select as per their choices, but what will happen if in a purchase indent iPhone X and MI MIX are approved? Who will win the order? Needless to say, you are smart enough to guess. This is not a competition at all.

Be a Winner

However, winning and losing is part of life but trying your best is in your hand.  If you work smartly and more important timely, then you will be a winner. Devote your time in knowing your competition. Don’t believe grapevines but get an authentic information. Obviously, you can’t be leading every time, but if you work in a process, you will be sure where you should put your time. Right utilization of time and knowledge will give you an edge over the competition.

Post Author: SimplyVedant

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.