Their survival required them to diversify their sales revenue…
A small company that offered specialized aeronautical software was primarily engaged in a B2B software sales business model. They had found that by selling through channel partners and integrators, they had little input into the sales process and were totally separated from the end-customer leading to a lack of control over their requirements, expectations and prospects for future business. They represented only a small portion of the overall value chain so when their channel partners required discounts in order to compete they had no offsetting revenue and these discounts went straight to the bottom line.
Their survival required them to diversify their sales revenue to increase their participation in the value chain, but this meant making a transition to implementing enterprise-level systems solutions directly to end-customers. This required new organizational capabilities, but as a small company, making an investment to bring in new resources in advance simply in the hope of new business was impossible. It would have to be done organically by finding the right customer and contract in which the technical requirements, delivery schedule, margins and payment schedule were carefully managed.
FES was given the task to spearhead this critical transition due to its proven expertise in securing business with aviation customers requiring enterprise-level systems solutions. Using its global network of relationships, FES was able to identify a number of potential opportunities, but considering the unique criteria of this mission most opportunities were discarded upon further analysis. At the end of this process, only a single opportunity emerged as a true candidate. It became a Must-Win opportunity for the client.
The opportunity selected by FES was at one of the world’s top-ten airports with a demanding customer that prioritized technical solutions of the highest quality over lower quality alternatives that were less expensive. This customer was willing and able to pay the price our client required to fund its business transformation, but in order to realize this opportunity the technical requirements would need to be favourable to our client, we would need to limit competition from eroding pricing levels, and negotiate delivery and payment schedules that would support the ramping up required to deliver.
FES engaged at all levels of the organization, but put a strong focus on interacting with their technical staff as they were the primary decision-makers for all procurements. Through many visits, presentations, demonstrations and continual conversations, FES was able to convince them of our client’s differentiators, respond to any objections and was invited to directly participate in the development of the solution’s technical requirements. The end result was a technical requirements document that justified a high contract value, represented an ambitious, but manageable step forward for our client and included favourable requirements that limited the competition’s ability to participate. FES achieved this with very little input from our client as they did not yet have the in-house expertise to contribute fully to the development of a solution of this scope.
When the tender was released, FES prepared and submitted the entire proposal itself resisting any urges to reduce the price and deviate from its strategy for winning. In the end, all the competitors declined to bid and with our client as the only bidder they were named as the winner. The strong relationships FES forged during the sales process made it possible to negotiate and sign a contract with acceptable delivery schedule and payment terms. The client is now well into the implementation phase, having brought on additional resources that will ensure the success of this contract and provide a foundation for the future of the business.