One of the major changes is that we are no longer a specialized industry that is applied as a preconceived part of a building. We are now the innovators that extend the reach and interaction of our client's information enterprise. In carrying out this task effectively, we must interface with our cli-ent's enterprise gurus, while sorting through our own technology evolution cloud to determine what is real and what is not.
Creative SellingOnce we understand our mutual capabilities, we must roll this into a financially justifiable package that will provide "off balance sheet financing" to reduce or eliminate our client's real costs. Do not interpret that creative financing means reducing our market share - quite the opposite. Getting involved in our client's financial plan will allow us to innovate and help put the cost, savings, and paybacks where they should be.
When today's low bank interest rates are coupled with innovative financing off the balance sheet, it allows us to successfully tackle the marketing barrier of the "first capital cost only" scenario vs. the payback-based "ongoing operating cost" scenario.
In an article on the AutomatedBuildings website entitled "Automation System Financing: A New Trend?" by Jack McGowan, he states:
"This economic climate calls for some new and creative approaches to selling systems. Fortunately, the banking industry is very interested in financing projects. This means that contractors may also have to overcome some old and familiar objections from customers who say they simply don't have the money. This means the only way to sell some projects will be to offer a finance option. Clearly this is not new, but all indications are that automation financing is about to become much more popular again. "As stated in previous articles, negotiated sales will also be necessary, and it could change the approach contractors take in establishing relationships with the customer, but for now the focus is on financing."
In addition, McGowan states, "Many banks are willing to work with a control contractor to go through a qualification process that simplifies financing too. If a company becomes established with a bank, it offers a real alternative for the customer who simply cannot or will not spend the money. Further, by borrowing a concept from performance contracting, it is possible to quantify savings and justify a project without necessarily providing a guarantee. The other exciting alternative is to offer off- balance-sheet financing."
He sums up with: "Taking proactive steps to address facility needs now, and financing projects with dollars that can come from savings will be an attractive story for many customers, especially if it does show up on the balance sheet!"
This is good advice, and the complete article is worth a read to determine how we all can make our own markets.
Integration Is KeyAnother article on the above-mentioned website, "What Got You To Where You Are Won't!" by Darrell Matocha and J. Rand Arnold of Controlshop.com offers:
"It is the integrator that is tasked with innovative thinking. The sales manager who finds ways to control systems without using 100% of his product, the engineer who finds new control solutions, the programmer who challenges "traditional" theory to create more efficient control algorithms, these are the forces that push a company to the front of the line. These innovators make reputations instead of just reading about them.
"Without a doubt, integrating nontraditional control and monitoring products will be paramount in the coming years."
They finish the article with: "If you aren't looking for new ways to satisfy your customers, increase marketing opportunities, and differentiate yourself in your industry, you will fall prey to your competitors that do."
The bit suppliers of the industry must also change and learn to make their own markets. Their acceptance of evolving protocols and standards is cardinal. Their markets are now a global affair, and creating sensing, actuation, networking, and installation products that adhere to international standards is the way they will create their own new markets.
Consultants, too, must reinvent themselves and make their own markets. This sometimes will mean partnering with the automation contractor to provide innovative solutions. Performance-based design-build solutions that are creatively financed will lead them to increased project satisfaction, improved client relations, and greater profits.
Are you making your own market? ES