There are two fundamental ways that you can grow your book of business or specific accounts. And in this blog we'll cover how you can implement 3 strategies to book more loads now!
You should be evaluating your existing customers a few times a year. And if you haven't done this all year, now's a great time to implement this. Many of the shippers do end of year inventory, will slow down for the holidays and this should provide you some time to get this together.
The first things you'll be evaluating are the most obvious; load count, average margin %'s and your average dollar margins per load. Some of the less obvious are quantifying the amount of hours you and your team spend on this customer's freight. This is probably not something you have any data or info on right now. But, you will want to spend some time trying to get an estimate of it. For instance, take a look at the next few weeks and jot down on a spreadsheet the number of issues you have to resolve. The amount of incorrect load info or details that need to be corrected on a daily or weekly basis. You can also add in some of the more subjective details such as your team's issues related to the customer. And you'll want all of this information in one place. This will make it much easier for you to get a visual of what each customer is providing to your brokerage. It's also going to give you a picture of the quantify of issues and time this customer requires to get that profit.
We want to build out a simple model that provides a sort of dashboard for your business. Our goal is to be able to look at the input or profit this customer brings to your business along with the cost to your business. This is going to give you an unemotional look at what each is worth to you. That's our starting point. It's also going to provide a lot more strategic value down the road.
Next, we are going to discuss how to determine if there's potential to increase those accounts. And the next two strategies are growing laterally meaning grow in number of points of contact at this organization. And penetrating the account with deeper relationships and more of them. But before we can implement them let's talk about what we need to find out.
First, we can't really determine whether there is room to grow laterally until we know how wide the company is. Here's what we mean by that. If you have a smaller shipper and there are only 2 people in their transportation department, and you've been working with them for 10 years. There's not much room to grow the number of people you're working with. Now on the other hand, if you're working with a medium sized shipper that has 5 locations and 50 logistics personal, but you've only been working with the same 1 person tendering you loads all year. There's plenty of room to grow those relationships laterally. Think of it like this, if you're working with 1 person, you need to introduce yourself to 1 up and 1 over in the next few weeks. Meaning, connect with their manager to review you're company's performance and introduce yourself to your point of contacts coworkers. 1 up and 1 over. This is a process that should be evaluated often throughout the year.
Now how do we penetrate an account further and do more with them then we already are? Well the same as above, we can't know where to go until we know where we are. So the first step is to build out a simple model or spreadsheet that has your customer and every one of their locations and points of contact. If you're currently working with a company that has multiple locations, that's the lowest hanging fruit. Getting a referral from one of your customers into another one of their locations is usually very easy to do. You can simply ask which other branches they work with most often. And then simply asked to be introduced through an email. If you've built the rapport and have been doing a great job with their freight, most shipping clerks are more than happy to refer you to their colleagues. The number one reason sales people don't get referrals is because they simply don't ask. They're either scared of rejection or imposing on their current relationships. That's just fear. Think about it, when you have a great provider of anything, whether it's the kid who cut your grass or your pediatrician, aren't you excited to pass that benefit onto your friends and coworkers? It's no different here.
So to recap, we need to know what each customer is worth to us. And it's not just looking at the number of margin dollars. Many of your least profitable customer will require the most amount of hours. Think the 80/20 rule. 80% of your profit is usually from 20% of your customers. And we don't want to spend our time increasing the least valuable types of customers. Secondly, we're going to determine our ability to grow our relationships laterally or horizontally. Meaning, introduce yourself to more of your point of contact's colleagues, managers and subordinates. The more people you are working with the more likely they are to give you more work. And it reduces the likelihood that you get booted if your point of contact takes another job and leaves the company. And thirdly determine how much deeper of a relationship you can have with your customer. If you're only moving a small % of their freight out of 1 of 10 of their locations. There's plenty of room to grow that over the next weeks, months and years.