When is an apparent dollar of CV (current value – the revenue/margin contributed by a given customer) worth a dollar on an even playing field when compared with the CV of all your customers …… and when is it worth something less, because the given customer is not fully in control of his/her chosen supplier choice. Classically, when the said customer is controlled by some higher body, such as a franchisor.
Remember from last week, I wrote about this real life conundrum arising in a B2B sales process workshop we recently facilitated.
Well the answer is that a dollar of CV (and a dollar of its “parent” … PV, ie potential value – the revenue/margin equivalent of all the given customer’s throughput/consumption of the product/service in the categories in which you compete to maximise CV … for that matter) is always one for one ….dollar for dollar, when comparing the number of CV or PV dollars between customers.
The fact that some customers on “even CV and PV playing fields” have greater freedom over their suppliers of choice is an input to their actual CV and PV………not an adjustment to be made afterwards to the numeric CV and PV. In other words CV and PV are CV and PV……… they are the numerics that result from a raft of business and personal conditions, one of which may be the degree of freedom of supplier choice.
Back to our real live recent B2B sales process workshop. Upon digesting this dissertation, my enthusiastic participant bellowed back “yes but the less control my customer has over his/her CV and PV, the less control I have in persuading buyer behaviour in my direction, when I visit as part of my account management responsibility!”. Another good interjection, I mused.
Does my erudite workshop participant have yet another valid point in terms of challenging the principles that underpin best practice B2B sales process for customer classification and sales team targeting? Tune in next week to find the answer.