The global pandemic accelerated America’s shift from a global economy to a more local economy. With COVID breakouts around the world and global shipping lanes challenged, our supply chains changed overnight. The economy of containers flowing like clockwork from China to US ports was upended, and US businesses scrambled to secure replacement materials, components, and finished goods. This caused scarcity and prices to soar … we all remember the run on toilet paper.
Fast forward a couple of years, and America’s businesses are changing. We meet with hundreds of Presidents and CEOs every year and listen to their business challenges. Some industries continue to deal with shortages, and therefore continue to command price premiums. Conversely, other industries have solved their supply chain challenges, and suddenly their channels are full. One CEO explained, “We came into the office one morning, and Walmart cancelled all of our orders. Their distribution network was full with our products. We had no idea, and now we must make tough choices to cut production.” Literally overnight a consumer products company’s operating plan was outdated and they were forced to adapt on the fly.
JACO sees companies transitioning from supply chain challenges to growth challenges. The pandemic driven scarcity required only one bit of marketing acumen … how much can we increase prices. Suddenly, businesses must dust off their marketing functions to drive growth amidst a much greater level of competition. While the 4 P’s of marketing (Price, Product, Placement, and Promotion) still apply, it is vital to reassess the competitive landscape from a strategic perspective before diving into your company’s details.
Here are 4 considerations for your strategic marketing function to assess before creating your internal marketing plan:
- How has your competition changed?
As your company has likely changed suppliers, raw material inputs, shifted production, or changed mix, so have your competitors. Who was reliant on partnerships with global suppliers who could have been impacted by the Russia – Ukraine war? Have the changes in tariffs impacted costs or created opportunities for substitutes? How have global energy scarcity and price fluctuations impacted costs? Are any companies more highly levered than others and feeling the incremental interest burden? A review of your competitors’ supply chains, balance sheets, and levels of capacity could help you identify opportunities to attack.
- How have your customers changed?
The same questions regarding your competition apply to your customers. Your customers likely had to make strategic choices about which segments they served with scarce supply, and their relationships could have changed. As you lift your periscope out of the water, ask yourself whether you are serving customers who are best suited to win in their industries. If not, what changes should you make?
- How will your industry continue to evolve?
Financial advisory is a broad offering so it’s imperative that you select an advisor who has experience and expertise in the specific area of business finance that you most need help with. A financial advisor who specializes in the biomedical industry might be a very capable individual but may lack the domain knowledge to effectively help your commercial construction company. Ask the FA you are considering to provide examples of past situations that may mirror the circumstances your business is dealing with. Make sure they understand where you are coming from, what you view as a successful outcome, and what you want to achieve for your business in both the near-term and long-term. Ask what tools and processes they will utilize to help your business, and if they will train you how to use these same tools and processes so that you can utilize them after their engagement is done.
- How will your company change in this new environment?
Similar to the competitive assessment, a frank internal assessment is necessary. Is your supply chain capable of winning long-term? Are your partnerships going to help your company thrive over the next ten years? What moves could your competitors make to attack your business, and how will you blunt these challenges? And lastly, are your customers going to grow?
One thing is for sure in today’s environment … change is for certain. The pandemic only accelerated these implications. Geopolitical events continue to unfold rapidly. Those companies who not only adapt, but anticipate the future have the power to shape their industry.
Many businesses’ priorities have shifted from supply chain crisis to an overabundance of availability. JACO encourages you to get in front of the global changes before your competition.
If you would like to learn more about how JACO can help you navigate these times, give us a call, or drop us an email, we would welcome the opportunity to learn more about your business and the challenges you are facing.