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Box moving 2.0

01 Sep 2008

Box moving 1.0 — the old perception

It wasn’t so long ago that being labelled a ‘box mover’ was not a compliment. Images of shady characters working from obscure locations selling boxed products that seemed to be at silly low prices came to mind.  The price was everything and the post-sales service was, shall we say, vapour.

But in recent years, two new types of very professional box movers have taken hold in the dealer space.

  •     The retail chains

You know who I mean. The ones that shout at you from the TV and bombard your letter box with junk mail. They are highly organised machines and they can make big budget advertising campaigns work.

  •     Online resellers

The ones I have in mind are the professionally run ones, not the PriceSpy specialists (maybe that’s where the 1.0 box movers went!). Online guys have serious volume also, but not the same marketing expenditure. They are able to get products to market through extreme optimisation of resources and processes.

Compared your prices to these guys recently? So we have box movers 2.0.

The corporate guys are doing it too — they call it a ‘procurement service’. They have long since moved from a product model to a service model. So much so that one of the ‘services’ they now offer is box moving. Some offer a web interface and call it a ‘procurement portal’. 

So what characterises a 2.0 box mover?

  •     Strong supplier relationships
  •     Ability to mass market — nationwide volume sales
  •     Effort per sale measured in minutes, not hours
  •     No traditional account management

The challenge for the ‘service focused reseller’

The New Zealand SME market is serviced by literally thousands of dealers. They do an admirable job, with little recognition. Every community in the country is serviced by at least one dealer who is able to offer prompt and efficient services. I call these organisations ‘service focused resellers’. While they no doubt sell a fair bit of product, their main profit comes from the consulting, onsite services, training, web and/or software development.

But talk to these people and you find some tales of woe, such as:

  •     Days spent on preparing a quote, only to have the customer take the quote to a box mover. Lots of time spent with no revenue.
  •     And the one about how they sold a box to a customer which they then installed. The box failed and the customer expected them to recover the faulty product, deliver a replacement and re-install. A lot of time spent that won’t be recovered from the box sale profit. Another loss.

Funny isn’t it — if the end user had purchased the product from a box mover, they would not expect the same level of service. When you sell a box and sell a service, it’s easy for lines to blur.

So what characterises a service focused reseller?

  •     Strong customer relationships
  •     Ability to extract the maximum value from finite number of local customers
  •     Significant effort in getting the right solution for the customer
  •     Strong account management

That’s pretty much the opposite of a box mover!

Are the two business models actually complementary? Is a service focused reseller / box mover partnership a future business model? Resellers often advise customers to focus on their core business and outsource the rest. Do what they do well, and leave IT to the IT experts.  It’s certainly a good argument if you want to increase service revenues!

Well perhaps it’s time for service focused resellers to think about outsourcing their box moving. After all, selling their expertise is where their profits are generated.

The big difference is,  this way of doing business is now available to all resellers, not just the big ones. Food for thought?  

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