Not All Business is Good Business
All Business is Good Business!
Ask most brokers which customers they want and the answer will be the same – all of them.
Brokerage is competitive enough that onboarding any new business is usually seen as a win.
- Maybe it will be easy to service…maybe it won’t.
- Maybe it fits well with your existing business…maybe it doesn’t.
- Maybe you have carriers for the lanes…maybe you don’t.
Who cares? You spend a lot of time trying to land new business so, when an opportunity presents itself, you’ll figure it out.
…right?
Maybe All Business ISN’T Good Business
I’m going to suggest that all business is NOT good business. Well, it might be good business for A brokerage, but it might not be good business for YOUR brokerage. And, if you onboard business that isn’t a good fit, that amazing new customer might end up costing you more than business is worth.
As an example, put yourself in the position of a small brokerage (under $25M) and think about onboarding a typical “enterprise” shipper. You know the ones:
- Big logo
- Huge volume
- Low margins
- High service requirements
- Long pay terms
That customer is going to be a great fit for some brokerages, but they’re going to be a real struggle for a small brokerage. The volume, the service requirements, the pricing, the payment terms…all of those things are going to be an absolute nightmare for a brokerage that isn’t ready to support that kind of business.
That’s just one example, but the moral of this story is this: Just because a customer is a great fit for the brokerage across the street does NOT mean that they’ll also be a good fit for your brokerage.
What’s Your Ideal Customer?
So, what do you do with this information? Most importantly, take some time to figure out what your ideal customer looks like. This can include a lot of different things:
- Industry Segment
- Type of Freight
- Lanes & Volume
- Company Size
- Service Requirements
From there, don’t be afraid to disqualify a prospect that doesn’t fit your ideal customer profile.
Yes, the industry is competitive and you don’t want to say “no” to business. However, by disqualifying prospects that aren’t a fit for your business, you’ll have a more targeted sales effort and avoid wasting time trying to service freight that isn’t a fit for your brokerage.
Sync Logistics Training
If you found this interesting, check out what we’re building at Sync Logistics Training. We cover this topic and more in our coursework on Customer Sales.
Reach out to nick@synclogisticstraining.com for more information.
