“We specialize in large, global, Fortune 500 customers!”
That may sound good to say, but it is severely limiting. Why? Simply because there are only 500 companies in the Fortune 500. Even if you extend to the Fortune 1500, it is not an oversimplification to point out that there are only 1500 companies on that customer list.
A far more interesting list might be the list of mid-market companies, those companies with sales between $50m and $500m in sales in US dollars. In the US alone, this potential customer list consists of over 55,700 companies generating $1.7 trillion in economic output and providing jobs to 16.5 million people (think ‘users’) according to global bank HSBC. That’s more than 37 times more customers than in the measly Fortune 1500 list.
HSBC also notes that there are 40,200 such midmarket companies in China producing $1 trillion and employing 74 million people. Germany has 11,900 midmarket companies, and France 9,300.
This same infographic shows us that Extending downward from US$50m in sales, estimates reach over 15,000,000 small-to-medium businesses (SMB) on that potential customer list.
Who Has the Leverage?
Anyone who has ever sold into the Fortune 1500 knows their sheer buying power. With that volume comes leverage. Pricing is cutthroat. Margins are sliver-thin. Loyalty is seldom assured.
Midmarket customers may not match the volume, but they’ll pay a longer dollar for quality. Since most of them are service companies themselves, they respect quality service and are willing to pay for it. They are also agile enough to try new things, and it doesn’t take acts of Congress to get decisions made. There are often far fewer layers of senior management to go through.
Vertically, business services companies in the midmarket are the top producers of economic output and jobs with 4.5 million potential users. Wholesale & Retail are second in economic output and third in jobs with 3.1 million potential users, with Manufacturing taking third place in economic output, and second in jobs with 3.3 million users. All of these verticals and their 11 million employees benefit from and continue to depend upon print services to run their businesses.
Creating Customers
Access to line-of-business (LoB) managers is easier in smaller organizations, and the cost of pursuing, penetrating, and creating a new customer in the midmarket can be significantly lower in pure dollars and even more significant in terms of time to market.
With decision-making moving away from purchasing departments and new applications and services becoming the province of departmental management, your path into a midmarket company is far easier to pave than trying to unseat an incumbent in a Fortune company.
Find Your Sweet Spot
Whether you pivot your pursuit based on dollars or seats, work to find that ideal size customer that best resonates with your messaging. The smaller the company, the fewer onboard technical resources they will have, creating the need for your services.
The larger the company, the more departments with more opportunities will be available. It is to your sales and marketing team to track your successes and determine where your best opportunities lie.
For more assistance in targeting your ideal customer, talk to your Xerox partner rep today.
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