Lost opportunities, reduced sales, broken relationships. These are the nightmares of all brand builders. Maintaining stable business relationships are crucial to brand growth, and business relationships are based on performance over time. So why would a brand builder risk turnover when key relationships hang in the balance of moving their own brand forward in the marketplace?
Perhaps folks in the Human Resources Department have been given permission by top management to “mix things up” on a regular basis by moving people around in different positions within the organization, regardless of their relationships to buyers and vendors. You know it can take years to finally develop the trust you need with a big buyer who can display your branded products throughout a chain or big box store. Why put a new person in there who is not known to the buyer and start all over again? Have you given HR too much power?
Perhaps it is because Human Resources think that mixing it up is good for the company and lays out a blanket “musical chairs” policy. If the company is doing well in spite of disrupted relationships in the field, HR will certainly take a bow and claim mixing it up as the management technique that made the difference. But they can’t measure the sales that would have happened if they left the relationships intact.
Maybe the folks in HR have forgotten where the money funding their paychecks actually comes from. Of course it comes from the customer and not the comptroller. But that might be easy to forget when their offices are in the corporate building and not “out in the field” where the salespeople have to jockey for position daily with buyers who value long-term relationships.
Relationships with vendors and suppliers take years to establish, too. Vendors who like and trust your managers will go the extra mile, bend over backward to meet a deadline, and make sure your company gets the very best products, services and prices. They will do extra favors for folks they have built a relationship with to help prevent out-of-stocks, probably the biggest brand killer out there. But since the out-of-stocks are minimal because of established relationships, it’s easy for the company’s HR Department to take this apparently smooth running supply and distribution systems for granted. They may not realize how personal relationships are the glue that is holding these systems together and the grease that keeps the wheels spinning.
Playing musical chairs can stop the music! Before letting this happen in your company, rededicate yourself to the fact that brands are built on the backs of personal relationships. And those relationships need to be recognized, promoted, and protected! Whatever perceived benefits your HR folks may tell you about mixing it up every two to four years should be balanced against what your salespeople tell you about the benefits of maintaining and nurturing those hard-won long-term relationships. They make all the difference in sales. And isn’t that what we all want anyway, sales? Isn’t sales the way that brands are built ultimately?
Make sure your HR people understand the value of stable relationships with your vendors, suppliers, and buyers, and the role these relationships play on their paychecks. Don’t be fooled into believing that putting new faces out there will result in increased profits and sales. If your business is down, then consider making changes. But if it ain’t broke, don’t fix it!
Who Are We.
Having built and sold a bestselling national brand, we appreciate the value of brands and everything it takes to make them successful. Companies are valued by their brand equity. Achieving and maximizing brand equity requires tremendous respect for all your customers, from your wholesaler to your end user.
Starting in our laundry room with no money and no knowledge of the industry, we built the famous Barefoot Wine brand. We learned a lot they don’t teach in school and much of it the hard way. Although our success was in consumer products, our real world experience will be helpful to anyone looking for information and advice about brands.
We have written the New York Times Bestselling Business Book, The Barefoot Spirit: How Hardship, Hustle and Heart Built America’s #1 Wine Brand, which chronicles the history of the famous brand from its inception through its acquisition. Our book is now required reading in schools of entrepreneurship across the country. We hope this book will provide inspiration and encouragement for all those contemplating starting a brand or wanting to improve their existing brand.
Michael Houlihan and Bonnie Harvey
-Barefoot Wine Founders