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Case Study

Bossard Fasteners (A): Fighting B2B commoditization

By Stefan Michel

12 pages

September 2018

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Reference: IMD-7-2020

As the market leader in fastening technology Bossard maintained a global network of more than 1,800 employees in 50 countries from its headquarters in Zug, Switzerland. The company focused on the supply of fasteners, a process that included sales, technical and engineering support and inventory management. Its business model also spanned three strategic areas: product solutions, application engineering and logistics. Bossard enjoyed a very strong value proposition if its account managers could only access engineers, quality managers, heads of operations, research and development (R&D) departments and business owners who understood the total cost of ownership (TCO) concept. If it had to submit a quote in response to an RFP (request for proposal) and bid for a given list of parts, the customer’s procurement department might simply compare prices, and Bossard typically was not the cheapest provider. Competitors also had copied Bossard’s logistic system and claimed that they could offer similar solutions for lower prices. Anecdotal evidence suggested that most competitors’ solutions were less reliable and accurate than SmartBins and that their data integration workflows did not work as well. In a manufacturing world where global competition, commoditization and strategic procurement puts suppliers under constant margin pressure, how was it possible that a Swiss-based fastening supplier could grow profitably with an EBIT (earnings before interest and taxes) margin of 12.3%, significantly above industry benchmarks?

Learning Objective

How to build a competitive advantage in a tough B2B market through differentiation.
How to craft different value propositions to different clients.
How to design a strategy that addresses the main obstacle in the market, i.e. commoditization.
How to create new “to-to-market” strategies to avoid a price war by not focusing on requests-for-proposals (RFP) and competitive submissions.

Keywords

Strategy, Business to Business, Marketing, Digitalization, Differentiation, Digital Transformation

Settings

World/global, Switzerland
Bossard Holding
2017-2018

Type

Field Research

Available Languages

English

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This case study is part of a series

Bossard Fasteners (A): Fighting B2B commoditization
Bossard Fasteners (B): Developing a digital strategy by refusing a digital transformation

2019 EFMD CASE WRITING COMPETITION AWARD WINNER (Shared 2nd prize) - Hidden Champions category

This case study is part of a series

Bossard Fasteners (A): Fighting B2B commoditization
Bossard Fasteners (B): Developing a digital strategy by refusing a digital transformation

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