B2B - Strategy Tools - Part 8

Who are your real customers?

The value chain

In business you naturally think of your customer as the one you invoice and from whom you receive your payment. But in Business-to-Business that is only partly true - your customer use or integrate your product or service in their product or service and so on until the final product is used or consumed by the end-user or consumer.
If you e.g. produce sealable lids for food packaging your direct customer may well be a producer of dairy foods like yogurt.
Referring to my previous post about customer value the value you can create for your yogurt producer can happen in 3 ways:

• Sales price: Increase the sales price of your direct customers product by e.g. improving the barrier properties or the print quality of your product.
• Productivity: Improve the productivity of your direct customers production by e.g. reducing the sealing time required.
• Unit cost: Reduce the unit cost of your direct customers production by e.g. enabling him to reduce the waste - but as I also wrote don't start by reducing the price of your product!
  

But maybe you should think of the consumer as your real customer? Without someone eating yogurt there would of course be no need for sealable yogurt lids.

So you should also look at the important needs of the consumer and also the other participants in the value chain between you and the consumer.

How can your product or service create added value for them - maybe re-sealable lids?

PETER SØRENSEN