Marketing
Small and medium size enterprises (SME’s) tend to operate their business by combining the sales and marketing functions. In the early days of the company this may have been an acceptable practice but in today’s competitive marketplace, marketing needs to be a totally separate function. When a sales department is in charge of marketing, they tend to focus on product discounting as a means to drive sales. Discounting is an effective means of driving sales (production), but it must be done strategically. Product discount offering should be offered during slow periods and be available for short finite period in order to avoid buying and storing of the products. Most importantly, when a discount strategy is repeated each year after the initial, a manufacturer should expect the customer to plan for storage and reduce their purchases at regular. The impact to the manufacturer of annualizing discounts is generally erosion in margin.
The marketing function looks at sales from a broader perspective. The proper development and execution of product marketing strategies considers activities related to new product development, packaging options, product relationship selling, attend industry trade fairs, etc… A dedicated marketing department is usually very aware of competitor product lines and ongoing product and packaging developments. In addition the marketing function will also work closely with a product development team (lab is an
example) so that when a product comes out development they have identified the customer channels to pursue and the pricing strategy to be used to optimize sales and most importantly the profit availability.
SME clients that I have worked with for many years capitalize on my exposure to their product market especially in the availability and production of standard and new innovative packaging concepts. Providing creative and innovative approaches to product development and marketing is a key factor that can contribute to accelerated sales growth.