Sales Training Blog : Look out! Multinationals leverage recession for exclusive buying programs

As a direct result of the recession, 44% of all companies are asking for more price concessions. But how customers pursue cost savings varies by the kind of company they are buying from.

According to the new study by Josh Gordon from The Customer Collective, “What Is Your Recession Sales Strategy,” customers of Multinational corporations are much more likely to be open to exclusive buying programs to reduce their costs while the customers of entrepreneurial companies are more be open to partnerships to achieve the same end.

According to the report, 20.9% of multinational corporations report their customers are considering exclusive buyer relationships to reduce costs. In contrast, only 4.5% of entrepreneurial companies, 6.8% of mid-sized companies, and 3.8% of small companies have customers considering the same approach.

This is a case where bigger is better. Companies that have the size to offer price reductions in exchange for exclusive buying programs can lock our competitors and lock in customers to higher volume buying as result of the recession. In good times exclusive buying progams can be considered risky. By putting all their eggs in one supplier's basket can cause problems if the supplier's performace fails. But the recession can drive a need for cost reduction that over shadows this risk. If you are not working for a multinational corporation, look out, if they consolidate buying in the product category you sell in, your business disappears.

In contrast, more entrepreneurial companies report customers that are interested in partnership relationships to reduce costs. According to the report, 23.6% of entrepreneurial companies have customers interested in this approach. Customers also interested in this approach are 19.4% of multinational corporations, 19.2% of small businesses and, 15.1% of mid-sized companies.