- Providing superior customer service is the #1 differentiator between one distributor and another.
- Besides financial measures, customer satisfaction should be the top metric that distributors base their success on.
- The best mechanism for measuring customer satisfaction is a comprehensive company-wide survey of customers.
In many cases, as a distributor, you are offering the same products as your competition. In order to differentiate yourself, what can you do to stand out? The number one thing that will differentiate you from your competition is the level of customer service you offer.
Besides financial metrics, customer satisfaction should be the top metric that your company bases success on. Customer service is a leading indicator, not a lagging indicator. This means that what your customers think of you tells you what your market share will be and how successful you will be down the road.
With today’s ever-changing market, and the increase of avenues for contractors to purchase product, it is even more important for you to differentiate yourself through the service you provide. It is necessary to have a way to measure this service in order to be flexible and update your services to flow with the needs of your customers.
The best mechanism for measuring customer satisfaction is a comprehensive company-wide survey of your customers. This is the most reliable way to gather data and feedback from your customers. If you would like to learn how to go about that successfully, follow these three key steps for conducting a customer satisfaction survey:
Step 1 – Formulating the Survey
When formulating your survey, consider what aspects of the business are necessary to measure.
First, you should be looking for feedback on people who answer the phone, counter and inside salespeople, technical support, outside salespeople, delivery and warehouse personnel, the credit department, and the branch manager. Have your customers rate your personnel in three areas, friendliness, responsiveness, and knowledge.
The next section should have customers rate your services. Gain feedback on competitive pricing, timeliness & accuracy of quotes, order fill rate, breadth of product inventory, order accuracy, timeliness of deliveries, emergency service, timeliness of will call service, invoicing accuracy, processing of credits and returns, and your website and ecommerce. Customers should rate these services in two different manners: a stand-alone rating and comparison to competition rating.
You should also look to gain additional insights from your customers. Additional questions include:
- What is your main HVAC Equipment Manufacturer?
- How satisfied are you with your current HVAC Equipment Manufacturer?
- What could ABC Supply do to earn a greater percentage of your business?
- What types of products would you like to see ABC Supply stock or stock more of?
- Do you currently have an online account with ABC Supply?
- What percentage of your total material purchases are being done online?
- What improvements would you like to see made to ABC Supply’s website?
This is also a great time to gain insights into how customers’ sentiments have changed since the COVID-19 pandemic. Include questions like:
- What are some helpful/innovative services that other distributors are offering that you would like to see ABC Supply offer?
- If since COVID you have been purchasing more from a new supplier or channel, what caused you to move your business away from ABC Supply?
- Do you anticipate the amount of business you conduct online with distributors being more, the same or less Post-COVID than you did Pre-COVID?
- Do you anticipate how often you physically go into a distributor’s branch location being more, the same or less Post-COVID than you did Pre-COVID?
Once you have collected your data, break out the survey results in three ways – by branch location, by customer type, and by market type.
Step 2 – Determining Which Customers to Survey
A general rule of thumb is to send your survey to every customer who has purchased at least $1,000 from you in the last twelve months. You can strategically add in some love-volume customers to your survey list to achieve a minimum of 100 customer contacts per branch location.
You should send the survey to “buying influencers”, not accounts payable personnel. Send to people who make purchasing decisions to get the best results. This includes owners/executives, project managers, sales managers, and purchasing agents. The more customers you survey, the better, so send the survey to multiple people at your larger customer companies.
Step 3 – Reacting to the Customer Feedback and Following Up
To effectively utilize the data from your survey, respond to the feedback by doing the following:
- Corporately identify 3-5 areas where you scored lower as a company and create action plans to improve in each of those areas.
- This could be inventory levels on certain product categories, pricing structure with Tertiary customers, search filters on E-Commerce site, or friendliness of credit department.
- Identify 3-5 improvement areas for each Branch or Department based on survey results and create action plans.
- This includes knowledge of counter salespeople, friendliness of branch manager, responsiveness to quote requests, or speed of will call service.
- Review each individual customer’s written comments on the survey and determine follow-up actions for customers who wrote negative or recommendation-type comments.
These three steps will give you the best mechanism for measuring your customer satisfaction.
This information was provided by TJ O’Connor in our What’s Happening Wednesday Coffee Break Series for Marketers.
TJ O’Connor is the President of Farmington Consulting Group, a company that specializes in conducting market research for HVACR, Plumbing, and Electrical Distributors. Farmington is a HARDI Proven Partner and several HARDI members are clients of Farmington’s. Farmington just recently launched a Voice of Contractor survey nationally, on behalf of HARDI, and the results of that survey will be shared with HARDI members as part of our end-of-the year State of the Channel update.
If you would like to work with Farmington Consulting Group for your own Customer Survey, visit https://hardinet.org/proven-partners/farmington-consulting-group/.