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management using revenue intelligence software for recession proof distributors advantage

How Does Revenue Intelligence Recession-Proof Distributors?

Distributors that want to recession-proof their businesses need to implement Revenue Intelligence. Distributors are starting to feel the effects of a recession. And if they’re not, a majority appear to believe that they may feel the effects in the not-so-distant future.

According to MDM, 41% of small distributors are seeing indications of an imminent recession. While the sentiment isn’t widespread yet, it does appear that there is a growing belief that is economic doom and gloom coming our way. However, that means that it’s more important than ever to take action. Waiting out the storm isn’t going to fly.

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What is Revenue Intelligence?

Revenue Intelligence is an integrated platform of Customer Relationship Management (CRM), Business Intelligence (BI), and Pricing software that enables you to understand your customers and prospects, keep deals moving forward, identify and act on trends, and create pricing strategies.

How do Recessions Impact Businesses?

Just the sheer mention of “recession” strikes fear in the minds of any business leader, possibly sending you down a rabbit hole of trying to discover ways to recession-proof your distributorship. While we’re not here to argue whether or not we’re truly entering a full-blown economic downturn right now, recessions are an inevitability.

Significant declines in economic activity are coming. It may not be now, and it may not be in six months from now. But eventually, one will come, and it’s imperative that your distributorship is prepared for the worst.

As outlined by Investopedia, there are seven major impacts on businesses during a recession. Those seven impacts are compounded by one another and represent a sort of domino effect when the economy begins to slow. Each of these examples, however, is prevented or mitigated by Revenue Intelligence technology.

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Problem: Slumping Sales

The first thing to go heading into and during a recession is consumer confidence. The immediate reaction is to pull back and buy less. A softening or complete drop-off in demand can lead to significant pressure as demand begins to dip to your breakeven point. While you might have some cushioning built into your business to withstand a short duration of revenue losses, it’s likely not enough to compensate for a prolonged recessionary period.

Solution: White Cup CRM, MITS BI

When sales begin to slump, your focus turns to protecting business with your existing customers. Built-in sales workflows eliminate busy work so you can focus on selling. Marketing workflows empower sales reps, managers, sales ops, and marketing people to create outreach campaigns that reassure your customers and retain confidence in their relationship with you. Use a CRM solution to instill lost confidence and maintain your long-standing partnerships.

But don’t stop there. Use a business intelligence tool to foster growth and identify sales opportunities and product performance trends. The old adage that knowledge is power is proven true with BI. Visibility into the sales process exposes the places where you should or should not dedicate time to nurturing sales ops. Gain control over increasing overhead by uncovering expense trends. Centralize your data from your ERP into one dashboard filled with specific steps you can take to continue to sell when it seems like nobody is biting.

Problem: Cash-Flow Reductions

Getting cash in hand has long been a challenge for many businesses’ accounts receivable. However, it can be even more difficult during a recession. As cash-flow issues affect customers too, a growing percentage of accounts receivable may get caught up. As you probably already know, once the customer’s cash is uncollectible, that sends ripples through your business, and paying anyone becomes a challenge.

Solution: White Cup Pricing

When money is tight, not having a definitive pricing strategy in place will eat away at your margins or, worse, drive away your cash-strapped customers. Pricing software provides flexible pricing recommendations, statistical pricing guardrails, and powerful segmentation. Knowing when to provide a discount that doesn’t give up your profit can make the difference between maintaining a partnership or losing it. Strategic pricing differentiates you from the competition and will lead to long-term revenue success.

Problem: Employee Layoffs and Operational Changes

A spike in unemployment is commonplace during economic downturns. The need to do more with less drives businesses to revamp how they operate. Rethinking existing processes and workflows usually drives business leaders to pursue automation to increase efficiency and reduce costs.

Smaller businesses especially tend to be the first to lay off employees because they lack the cash reserves of larger businesses. With distribution an already tight-margin industry, layoffs are a necessary evil. But if you want to be one of the first to bring employees back, you have to find ways around staffing shortages.

Solution: White Cup Pricing, White Cup CRM, MITS BI

We would be remiss if we singled out only one solution in our Revenue Intelligence platform. In truth, each solution is designed to take away busy work so distributors can focus on selling more. It’s here, perhaps, that Revenue Intelligence demonstrates its true strength in recession-proofing your business.

White Cup Pricing works instantaneously to provide customizable pricing recommendations and pricing strategies so that you don’t have to wait around for manual analysis. White Cup CRM has in-built email marketing and marketing automation tools, so you don’t have to sweat not having a dedicated marketing team or person. MITS BI takes all of the data from your ERP and turns it into actionable insights—no spreadsheet monkey necessary.

Problem: Marketing Constraints

If they don’t entirely eliminate their marketing budgets, distributors will likely cut a majority of their spending on marketing initiatives. We get it, and we don’t. Distributor marketing is unlike other industries. You may not be seeing the immediate effects of a strong marketing effort, but at the same time, you need to continue to get your name and product in front of the right audience. After all, you can’t sell something that nobody sees. However, that doesn’t mean you need to continue to pay an arm and a leg to market.

Solution: White Cup CRM

As we alluded to already, implementing White Cup CRM means that you can market like a pro, minus the overhead. Marketing workflows empower all team members to create outreach campaigns. Customizable templates make personalized and consistent emails easy and efficient. Tracking your marketing campaigns is available at a glance, meaning that you’re able to punch far above your weight class.

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Problem: Price Wars

Even in times of economic prosperity, there is an innate reaction to offer discounts when you feel a deal slipping through your fingers. In a recession, that gut instinct is far more dangerous. Not only can you lose money on that initial deal, but it can trigger a price war against competitors that drives profitability down further. A true race to the bottom that may benefit customers in the short term but hurt all involved in the long term when it comes time to restore normal pricing.

Solution: White Cup Pricing

If you want a glimpse into what these price wars look like, White Cup Pricing will allow you to run “what if” scenarios to forecast the impact of potential pricing options. See for yourself how detrimental the wrong price can be for your distributorship. Instead, use Pricing software to understand your customers’ needs during this time of uncertainty. Examine your customer base and segment them in a way that allows you to approach each conversation with an understanding of how you can best serve them while maintaining profitable pricing.

Recession-Proof Your Distribution Business with Revenue Intelligence

The key to a recession-proof distribution business is arming your team with the knowledge that Revenue Intelligence provides. Constant visibility into all aspects of your sales and pricing processes will mean the difference between your business simply surviving a recession or thriving on the other side of it.

White Cup offers a revenue intelligence platform with integrated solutions specifically designed for the distribution industry. Our CRM, Business Intelligence (BI), and Pricing software is the complete revenue engine for distributors and is laser-focused on driving more revenue and improved profits. With decades of industry experience, White Cup is trusted by more than 1,000 customers globally.

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