Minimum order quantities

Good morning everybody - I trust that this day finds you well. I, sadly, have all but completely lost my voice, so I'll be confined to communicating via email, blog, post it note and smoke signal for the rest of the day.

Last night I found myself enjoying a telephone rant with an associate and as he is a follower of this blog, he suggested that it would make a suitable topic for today's posting, so a big shout out to KM in Hertfordshire - you know who you are. More importantly, I know what you did - and you should be ashamed of yourself.

We found ourselves talking about small orders. Now this is a touchy subject because any sensible business person will tell you that there really is no such thing as a small order. Oh sure, the initial value may seem low, but that person could become your next biggest customer. Good sense usually plays its part though. If Microsoft call you up because they want 12 football shirts for their company team, then you'll probably run around like a headless chicken to make it happen.

Similarly, if the local comprehensive call you up with the same request, you may well politely have to turn them down.

The important thing is that you need to put a value on your time, and the time of your suppliers too. Minimum order quantities exist for a good reason. In the world of print, it takes time, money and manpower to set up print plates and start up massive machines to process orders. Simply printing, say, 50 plastic pens is just not cost effective for anyone involved in the process. The simple rule of thumb is that the cheaper the item, the higher the minimum order quantity.

Pens actually provide a good example there. If you're looking for a budget pen around the 30p mark, then you're likely to find minimums of 1000, or 500 if you're lucky. Conversely, if you only need 50 pens for an event, then the price point is likely to be closer to the £6 mark.

Now there are some customers who think that we're trying to be difficult. We're not. We're trying to be profitable, and frankly we make no apology for that - why should anyone in business apologise for wanting to make money?

Do you remember what I said about politely saying 'no' to the local comprehensive school? That is absolutely key here. You see, it is perfectly acceptable to turn small orders away, just as long as you explain your reasoning behind it. Now I get it - sometimes you just figure that the whole order is going to be too much of a headache and when you look at the return on it, you realise it's not worth your time.

Well why would you not explain that to your customer? You may not wish to be so blunt - OK, I'll rephrase that - you wish you could be so blunt but understand that it would most likely get you into trouble, but if you have a good relationship with your customer, surely they would understand wouldn't they?

They wouldn't? Well whose fault is that? I've spoken on more than one occasion about managing the expectations of your customers. If you paint yourself as a miracle worker who'll gladly work through the night to ensure that your customer gets his £50 order on time then I admire your commitment to customer service, but you're just not being very realistic. You're not valuing your own time and you're actually losing money.

Your best customers will always respect your honesty and your practical approach to their situation. If you can help them without losing money, then you should do so. However, we're often reminded that 95% of our headaches will come from 5% of our customers, so just how much do you stand to lose by telling these people that on this occasion, you simply cannot help them.

Those words are very important - ON THIS OCCASION. Telling them that, along with the the reasons why, may well mean that they return to you in the future. And the last part - you cannot HELP them - remember that customers come to you for all sorts of reasons, but ultimately it's because they need your help, so make sure you acknowledge that fact.

Most importantly, make a point of setting your minimum order value - that's the point at which, if you went any lower, you'd fail to make a profit. AND STICK TO IT. Now don't get me wrong - there are plenty of things that you will do for your clients for free. You could give seminars, offer to work in their offices for a day, come up with presentations, you name it - but it all has to lead somewhere, and if you have a clear picture of your objectives in offering all of this free stuff, then you will ultimately succeed.

Just remember, it is your responsibility to show your customers just how valuable you are. Doing so time and time again will mean that you won't need to get into petty conversations about price or sign-offs from managers or all those other pesky little day to day things that we would all much rather do without. You are the most valuable commodity with which you can trade. Nobody else knows what you know or can do what you do, and if your clients are shopping around for someone who they think can do your job better than you can, then you haven't shown them your true value yet, so get out there and fix it.

That's my bit for this week. Just a chance to tell you that if you're looking at using any promotional merchandise in early January, that your deadline really is creeping up fast. Factories will close over Christmas and this means that everyone will find themselves in a mad panic some time around the 4th of January. Don't be amongst them - take care of things in advance and give yourself the chance to enjoy a relaxing festive season.