An anecdote

My father-in-law has run a number of businesses in his life, both large and small. His current business is based on selling tractor parts to dealerships in Latin America. That he makes a successful living in this trade is down to all the obvious factors like hard work, product knowledge and market knowledge, but this alone probably wouldn’t make a viable business.

His competitors are Massey Ferguson, John Deere and Ford. His is a small business. How does he compete? Firstly, he has an excellent relationship with his customers – he can bring all the business background and skills of a major account manager to a relationship that Massey Ferguson assigns to a junior sales rep. No contest. Not only does he talk their language in business terms, but he has also invested a considerable amount of time (at age 60 plus) in learning Spanish and trying to get a deeper cultural understanding of his customers.

So I kind of believe him when he says that these dealerships are not about to start buying their tractor parts over the internet any time soon. He knows them and their shops better than I do. There are people that would have us believe we are on the verge of a global transition to a web-based economy, and that “high-touch” sales and marketing techniques for low-value accounts will be made obsolete by automation. Don’t believe everything you read.

It’s not a recipe for getting massively wealthy in 18 months but it is sustainable for the time being. And I believe there will always be a place for human relationships in business, even for low-value transactions.

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