For a recent new manufacturing account, we had a list of their items they purchase from other distributors. They wanted to make sure we were in the ballpark before we continued our conversation on services.
We got costs for the items and put what we thought was the correct margin by item group (i.e. x% on all chemical, x% on all paper, etc). I then asked for the products to be run through SPA. SPA pricing was over $40,000 more in spend per year compared to my pricing with varying margin per item. We took what I thought was a chance and went with SPA pricing.
It was not a chance as the customer said our pricing was quite competitive, some items a bit higher, some lower, but all within a great range. We should be getting our first order from them next week. And to think we would have left over $40,000 on the table.
Jill Kegler, President and CEO