Cultivating new business leads will be a crucial factor in ensuring forward-thinking firms bloom in the post-recession packaging sector, says Jill Park

Winning new customers is essential to the survival of any business, and even more so when emerging from a recession. As the packaging sector in the UK tentatively begins to loosen the battens on its hatches after one of the stormiest downturns in memory, maintaining the momentum of economic growth with an order book of new clients will be crucial in securing the future of the industry.

"Everyone needs new business, both to provide growth and to replace lost clients," says David Barnfield, managing director of training and consultancy business PiP Associates, whose most recent seminar is titled ‘How will you emerge from the recession?' Barnfield asserts that "even to stand still", packaging companies need on average at least 10% new business every year.

However, before attracting new clients is even considered, it is important for a firm to cater for its current customer base. "In existing accounts, we need to identify opportunities, aim for 100% supply and work with customers to develop new products, which will help promote and add value to their products," says Barnfield. "You can also work with the customer to take cost out of the packaging itself or the supply chain."

Once existing business has been considered, a firm can pinpoint opportunities for growth, but even identifying where to start can be a daunting task. Barnfield recommends working with the marketing department to seek out leads to supply to the sales team, using sources ranging from the internet and looking at lapsed accounts through to buying in databases. "The wider the spread of  sources you use, the better quality leads you will generate, with consequent improvements in success rates," he says.

Creating leads
"We'd never done any telemarketing, but it's been a roaring success for us and we are rolling it out," says SCA marketing manager Craig Carrington, who has been a keen advocate of using telemarketing to find new business opportunities. "It's all about generating appointments. That's when we send our sales team to go in and pitch. Getting that first foot in the door is really difficult and getting a specialist in makes it easier."

SCA operates in the contract packing arena, a transient market that companies have typically relied upon as overflow or a last resort, says Carrington. Telemarketing has enabled SCA to build a database of new business contacts.

One recent project Carrington undertook was the easyFairs trade show. The company decided to offer a discount on all contract packing orders placed at the show, which was held at the Birmingham NEC at the end of last month.

"On the contract packing side of the business we've never done an exhibition before, so I had to convince a lot of people in the company to do it. I really needed to make the most of money and get a return on the investment," says Carrington. "We were concerned it might lead to a mini-discount war, but we took the jump and I actually think it's going to be very successful for us."

In uncertain times, where credit insurance is no longer a given, it is crucial to undertake credit checks early on in the process, says Barnfield. "There is no point chasing people for business if they aren't going to pay you," he says. Everyone, he adds, should get involved in the process of winning new business, from the customer service reps speaking to clients on a regular basis through to the production team "impressing with a factory tour".

Linpac Packaging's vice president of marketing and innovations Adam Barnett agrees that having a close relationship with customers is important, and he is a keen advocate of ‘face-to-face' relationships. Over the past 18 months, the company has become more consumer driven, he says. "We've had to make sure our sales people understand what consumers want out of packaging and develop solutions out of that."

Equipment manufacturer Bobst has taken a similar approach as it attempts to cater for the mature UK market. "It's a market that has lost considerable business in the past 10 years, predominantly to the Far East and Eastern Europe," says Bobst business director for sheet-fed Nigel Tracey. "There has been consolidation of our customer base, but we are strong through innovation."

The company has particularly focused on strengthening its line-up of entry-level machines. "First of all, it's about knowing the market. It's about having a sales force that takes time to develop these customers. We need to plant some seeds."

New markets
Bobst regularly holds open-house events at its manufacturing site in Lausanne, Switzerland. "Informally, we've always held open days. Formally, we've held them since around 2004," says Tracey. Competence 2010 in September will be the next event.

The Media folder-gluer from Bobst was originally manufactured in Switzerland. In 1996, manufacturing of the machine began in Shanghai and it was sold to the Chinese market. Four years later the company decided to sell machines manufactured at this site into the UK market at a lower price point than those that were manufactured in Europe.

Once new business has been won, it is important to secure its future through supply contracts, service level agreements and consistent good quality, says Barnfield. "This will ensure business is not lost from the bottom of the funnel quicker than it is gained at the top," he adds.

Tetra Pak, meanwhile, carries out satisfaction surveys with all its major customers to ensure that it is continuing to meet their needs. The information is particularly helpful as account managers can learn from those that scored highly.

Retail manager at Tetra Pak Ian Williamson recognises that the recent downturn has affected pretty much everybody. "When times are hard, people are competing for business and giving their customers the best possible price. Our sales guys are going out there and everything they do is a competitive tender," he says. "It's not just based on price, it's about relationships and that's something that Tetra Pak has always prided itself on."

Winning new business is easier said than done, but it is an integral part of companies' survival. Identifying fresh opportunities should not come at the cost of maintaining your existing customers. The prospect of winning new business can be a daunting one for account managers in such uncertain times, so a methodical approach can help. But ultimately, it seems, the key is to ensure everyone is working towards the same goal, because every member of staff, from the boardroom to the guys on the factory floor, can make a difference during a customer visit.

IN WITH THE NEW
David Barnfield, managing director of print and packaging training and consultancy business PiP Associates, recommends the following approach to winning new business:

1 Cater for existing customers Identify opportunities, work with customers to add value to products and take cost out of the supply chain

2 Identify targets Go through old quotes, lapsed accounts, buy into databases, research new markets, attend seminars and exhibitions, read trade press and publications to find leads

3 Credit check This needs to be done at the start of the process

4 Get everyone involved All staff from the marketing department to the factory floor should be working towards winning new business

5 Set a drop-dead date A point beyond which you should not spend any more valuable time

6 Secure the business long term Through supply contracts, service-level agreements and consistent quality

AHEAD OF THE GAME
Neil Farmer, managing director of marketing, market research and PR agency Neil Farmer Associates believes now is the time to undertake research into new areas of technology and potential business development.

"Entrepreneurial opportunities arise because forward-thinking companies investigate blue-sky and often unconventional ideas, which have not yet come to fruition," he says. "This might involve funding, or part-funding, of academic studies at a university or institute of technology into a new material or process."

Farmer recommends getting ahead of the competition by bringing a new product or concept to the market before other companies in the industry are even aware of it. "There is a risk involved and, of course, a cost, but the recession will not last forever. When the upturn comes, having a new product to launch, which no one else has seen or heard about, could be a major coup. The fact that you had time to undertake all the preparatory work during the recession will make all the success achieved even more rewarding."