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Guest opinion: What can manufacturers take from best practice in the grocery sector to build trust and collaboration?

Neal Middle

Did you know that the UK grocery sector was worth £177 billion in 2015 and that UK food and drink manufacturing is worth more at £96bn than car and aerospace manufacturing put together?*

Did you also know that every year the leading high street grocery retailers ask their key suppliers for feedback on how they perform compared to other retailers?

Why?

It helps them to identify strengths, weaknesses and opportunities to work more closely with suppliers to better match their customers’ needs and to ultimately build sustainable competitive advantage.

Car manufacturers should systematically measure the dealer’s voice and integrate findings into a culture of ‘continuous feedback’ essential to uncovering value-creating opportunities that can equally transform a brand and help it outperform competition.

Not only are dealers essential to a car manufacturers’ success, but that regular measurement and feedback from them can be critical to business success.

Most organisations typically invest considerable amounts of time and effort into building trust and engagement with employees, a two-way process that involves day-to-day management of people combined with performance measurement through annual appraisals.

They also petition feedback through annual employee engagement and satisfaction surveys to inform a wide range of decisions around communication, training and investment needs, improving working conditions and reward and recognition.

Similarly, the vast majority of ‘brands’ including car manufacturers, will endeavour to build a strong connection with existing and prospective customers: outwardly through their marketing strategies and inwardly through increasing use of post-purchase and maintenance/servicing satisfaction surveys, which helps pinpoint what the customer thinks and areas to improve.

Manufacturers rely on their network of dealers to sell their cars.

Arguably, they are the brand.

Yet in the past, it would appear that many brands have not always regarded their dealers as important as, say their own employees.

In fact, according to an article in AM-online in December 2015, Gary Savage,  Mercedes-Benz UK chief executive, stated that when he took over the reins from his predecessor in 2010, he quickly noticed “members of the franchised network were being treated like children”.

There was also an obsession with “measuring KPIs to the point where it had become overbearing” and he felt it was “holding back the potential within the dealer network”.

Since then, its dealer relations are at an all-time high, having been the highest-rated franchise in the past two consecutive Dealer Attitude Surveys conducted by the National Franchised Dealers Association.

Having reviewed the summer 2015 survey, I believe there is a considerable opportunity for some manufacturers to investigate further some areas the survey already covers.

For example, a “dealers ability to do business with their manufacturer on a day-to-day basis”.

A poor score here doesn’t actually help to reveal what would improve it!

Also, the same applies to “whether the management of your manufacturer actually takes dealers’ views and opinions into account”.

Applying diagnostic research with dealers could glean actionable information and insight for a manufacturer into what it could do differently to enable its dealers to sell more cars to the public.

I do not believe the existing survey should be changed or upgraded as it provides a powerful benchmark for the industry, just that there is a significant opportunity for car brands to delve deeper and investigate where there are opportunities for improvement through tailored research.

So, how does this relate to the grocery sector?

A sister company of FOTP, a B2B market research company, pioneered the concept of relationship benchmarking back in 1988.

Its annual programmes have since become the industry standard for measuring business relationships in fast moving consumer goods, healthcare, pharmacy and foodservice channels in over 60 countries, helping clients to acquire information and insight into opportunities to improve their performance.

Author: Neal Middle (pictured), UK business development director of specialist market research agency, that conducts diagnostic research for clients in other markets. Email: neal.middle@fotpresearch.com

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