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How do companies move from no customer stratification program into a full program? Do you need to be of a certain size to pay attention to something like this? (Webinar Attendee Question)

This question was asked by an attendee during the Proformative webinar "Using Customer Stratification and Cost to Serve Information in Your Sales Efforts to Maximize Profits" held on October 9, 2012.  You can view a video of the webinar and access the presentation here:


Topic Expert
John Kogan
Title: CEO/CFO
Company: Proformative, Inc.
(CEO/CFO, Proformative, Inc.) |

There is absolutely no size issues associated with customer stratification. It applies equally to small and large distributors. The smaller the distributor, the more important it becomes to understand cost to serve and economies of scale (savings from doing more business with the same customer). Only then can the small distributor's limited resources be effectively applied. Service drain customers can give you economies of scale (which means they may not really be service drain, you just got the math wrong) or they can bankrupt you.

Answer provided by Dr. Barry Lawrence, Program Director, Industrial Distribution Program, Texas A&M, speaker on a recent Proformative webinar on the subject of customer stratification.

John Mansfield
Title: Vice President Business Development
Company: Graybar
(Vice President Business Development, Graybar) |

Since embarking on our Customer Stratification journey, I have been networking with other NAW companies who are also pursuing this type of project. I have found that companies of different sizes and different industries are all finding ways to utilize the concepts to increase profitability.

For larger companies that have internal resources like we do who are experienced in successfully implementing large projects, it can be done if you have a strong and focused leader for the project. For smaller companies without these type of resources, you can probably start on a limited basis by following the step-by-step guidelines from the research. But you also may need the help of an experienced consultant who has implemented this type of project before.


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