Business-to-business sales refer to companies who primarily sell products or services to other businesses that add value to their products or reduce their costs to operate — or both. One company selling to another brings a sophisticated seller and buyer together in cooperation to find solutions in which the seller’s expertise is applied to satisfy the buyer’s needs.
So, what is it that you’re marketing? Your company? Its products? Or its services? And how do you communicate your value proposition and organize your selling activities to best capture the business of customers whose needs may be different than similar customers in the same industry?
If you’re also working to acquire a series of tuck-in acquisitions through a buy-and-build mergers and acquisitions strategy, you further add to the business-to-business marketing complexity. You’re also endeavoring to build a company that supports a strategy of developing its capability, expanding its geographic reach, or improving its operations and supply chain, making the company more competitive. Buy-and-build strategies can increase the overall value of a company as the acquired companies are integrated and their expertise and experience are added to what the company already has to offer.
Lead a successful buy-and-build strategy
Leading a successful buy-and-build strategy requires managing significant ongoing change and developing a cohesive leadership team capable of scaling up the size and scope of the business.
Buy-and-build strategies are especially challenging for the marketing and sales leadership team who must begin to market the company you intend to be and not the one you’re running today. Add to that the complexity of each subsequent acquisition with its own business culture, industry reputation, sales and marketing plans, and brand names that will all need to be changed in some fashion to become integrated into the business fully.
I’ve seen marketing and sales leadership teams approach marketing integration in different ways. Many will start by developing a plan to change all the names of the acquired companies to the parent company name, and then try to make sense of the acquired brands by either repurposing them or rationalizing them into smaller numbers. I view this as more of a tactic than a strategy, and the most effective marketers I’ve worked with start a step back by asking fundamental questions such as: Who do we want to be? What is our mission? Where do we want to take the business? When do we need to start? Why do the customers buy from us? and How do we actualize our plans?
Asking and answering these and other “who, what, where, when, why, and how” questions, and developing a marketing and sales thesis that defines the companies’ value proposition and brand promise in a way that will create value for current and potential customers, is the first step. The second step is to work with your leadership and other stakeholders, including trusted customers and suppliers, to develop a shared vision with a clear mission statement that refines the thesis into the marketing and sales plan needed to successfully support the actualization of the company’s goals.
With the plan in place, the marketing and sales team can then develop a detailed project plan to manage everything from corporate identity and communications to product and service offerings, pricing strategy, market intelligence, branding, and all the rest. The detailed project plan focuses on developing solutions that harness your capabilities, expertise, product, and added-value services to create a compelling value proposition for your customers.
This, of course, is easier said than done.
From acquisitions to market domination
In my case, we acquired a platform company and did 18 subsequent acquisitions to build a global adhesives and sealants manufacturing company. We carefully chose the markets that we intended to compete in and then built out a toolbox of products, technologies, and added-value services to create a powerful solution-provider model. Our company model supported a consultive and technical selling approach where we developed close relations with customers to earn insight into how we could help them solve their toughest adhesive and sealing challenges.
We marketed our company’s capabilities and its flexible and thoughtful solution-provider consultive selling approach. We also refined the various product brands we acquired into a cohesive hybrid of product brands, combined with the company brand, to add to our toolbox of solutions. We then promoted our vision and brand promise consistently over time and backed it up with a highly experienced technical sales team, innovative product development, and on-site customer application engineering support.
A marketing plan takes time, patience, and consistency to achieve its desired results. We started our buy-and-build strategy by acquiring a small regional business with $35 million in sales and grew it into a $700 million global business through 18 add-on acquisitions. We marketed the company and its capabilities consistently over a 14-year period before we decided to sell it. In preparation for the sale, we did a third-party survey of our customers to see what they thought of us as a supplier, and the results confirmed that we met the expectation and provided the value we’d committed to in our marketing and business plan. As a result, we sold the company at a value far more than the sum of its parts.
It doesn’t get any better than that!
Theodore (Ted) Clark is a businessman, entrepreneur, and investor with over 40 years of experience as a senior executive in both public and private equity-owned specialty chemicals companies. Starting as a shipping clerk, he rose to become President & CEO of Products Research & Chemical Corporation (PRC), a global leader in aircraft and construction sealants and coatings. His new book, Buy and Build CEO: Leveraging Private Equity to Build a Winning Global Business (Dudley Court Press, Sept. 13, 2022), chronicles Clark’s 14-year adventure in the world of high-stakes, high-reward business. Learn more at tedclarkauthor.com.
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