For most of our clients and the industries we work within, 2022 was a good year. I know that is not a popular thing to say, but facts are our friends.
- Manufacturers’ biggest problems were inventory, not sales.
- Construction and associated services suffered from material shortage, not sales. (One caveat here is craft services were difficult to staff.)
- Transportation – I cannot hear Supply Chain Management (SCM) one more time. It shows up everywhere, but transportation is a big part of SCM delays and availability was the problem, not sales.
I can go on, but the point is most businesses spent time processing orders rather than selling. The measures of success have been revenue and margin that were artificially created by high demand. The measure worth revising for 2022 and into 2023 is market share. For those companies gaining market share, aggressive selling with longer-term contracts as a result will protect those companies from the negative impact of a projected recession.
When things are going well, we tend to declare success was from our work. When things are going poorly, we attribute performance to external circumstances.
Order taking rather than selling will be a continuing trend through the first two quarters of 2023, maybe a bit longer. This has the potential to skew the perception that there is strong selling happening. Sellers had the leverage in 2022. Buyers were on their heels. This will start to shift by the end of 2023. Unless you are in the tech sector, 2023 is going to be just fine. Tight labor markets and sustained demand will make 2023 a good year for sellers because there is a high buyer demand.
If you are in the tech and SaaS space, no predictions.
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However, here are seven trends I’m expecting in 2023:
- Companies are still buying big – large contracts with large and mid-size companies.
- Sustainability has become more important. It’s not just a nice-to-have component of buying – big money in 2022 and bigger money in 2023.
- Eco-friendly matters and the trend will continue.
- Domestic manufacturing and U.S. supply chain has exploded as a portion of total spend for all sectors. Price is still an issue when competing with overseas.
- Price increases driven by inflation will be less acceptable in 2023. Margin compression will push companies to compete more frequently on price only.
- Construction money for 2022, 2023 and into 2024 will be high.
- Healthcare, healthcare, healthcare. Whatever trend in healthcare spending will increase even more in 2023.
Let me reiterate, in 2023, especially the second half, we’ll see the trend turn back to selling rather than order-taking.
First-dollar revenue commission programs that pay salespeople for all revenue generated in an account can hide actual sales work behind growth from order-taking. Taking orders requires time and insight for sure. Does that effort reflect the necessary work of selling or is the company over-paying, compensating for orders rather than selling?
“Show me the incentive and I’ll show you the outcome.” – Charlie Munger
2023 is a good year to re-examine the process for customer buying and your company selling. It is possible your company should look at the service versus selling design and staffing to increase profits and support to your customers. These trends have been in place since 2015. The pandemic and SCM issues have accelerated the movement of customers’ purchasing process. It may be time to re-align.
Hunt Big Sales offers efficient systems and holistic approaches to smooth over change to land bigger sales — see how our company can serve yours, and contact us today.