Bang! – Clash! – Clatter! is our framework for understanding what happens to both buyers and sellers when prices must go up. This post discusses Clatter! See the end of the post for a short explanation.
Customers need cost controls and disciplines. Suppliers must make adequate margins. Customers will be pushing for cost reductions of 3-10% to meet expectations and what they want for margin improvement. Customers are also looking to extend the term (making suppliers lenders) and flexibility (ability to change for Bang!). Together with the opposite needs of supplier sales the difference isn’t merely a low single digit result – it could easily reach 10% of the value exchanged in the relationship.
Each side will break out its best weapons of persuasion to get its way, all the while the evaluating the risks from a break in the relationship. Tough negotiations will usually get decisions. Other decisions will be driven by expectations, chance, chaos, and egos. The Clatter! from broken relationships will be seen and heard in the street and the business media.
EkaLore works with customers and suppliers to help enterprises thrive. EkaLore can help skills (negotiations, tactics, metrics) or decisions (strategies, perspectives, analysis) as needed. Talk to us about how we can help.
Clash! is inevitable but getting out in front of it can minimize the fallout for your sales force. If you’re experiencing challenges as you raise prices, contact us at https://www.ekalore.com/contact
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Bang! Things happen, Clatter! Buyer and Seller organizations collide. Clash! Relationships change or end because of pricing pressure.
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