As a Manufacturer, you know it’s a continuous challenge to answer this question: is your Distributor not selling your Product? Establishing a Direct Sales channel through Online Marketplace is a great and fast way to assess if your Distributor is pushing your Products for real.
Making sure your Distributor is pushing your Products
Product Brand Owners and manufacturers have to work through distribution channels to market their products. Direct selling is not a growth model all by itself, as the usual best case scenario is topped at 20-50%. This is mainly because the Manufacturers are not organized nor equipped to run small quantity logistics and to prospect massive amount of retailers / customers.
Distributors buy directly from wholesale manufacturers, then market those products through a network of retailers. Distributors handle the logistics and marketing requirements that manufacturers don’t want to or aren’t able to handle in house. The manufacturer-distributor relationship benefits both parties. At its best, this is a partnership that helps both partners meet their goals. But in order to get the most out of the relationship, Manufacturers and distributors need to carefully manage the relationship to make sure both parties are in alignment.
Adding the Online Selling channel to your Distribution mix will give you more visibility on Markets, Territories and Customers habits. Those Data are most of the time hidden by the Distributors as they are the main reason why you need them.
What kind of learnings you get from adding Online Selling to your Distribution Channels?
- Sales Reps are not pushing your Products to the client base
- Sales Reps are only choosing a subset of your Product Catalogue to showcase
- Sales Reps are not targeting the whole list of clients from their CRM
- Distributors favor a Competitor substitute
- Distributors neglect pushing the Product when the margin is low
- No sufficient Branding/Marketing is in place at promising locations
The main reasons are split in 4:
- Failure to understand the manufacturer-distributor relationship. If you’ve gotten this far, then you already understand that the relationship isn’t a customer relationship, even though invoices are sent to the distributor. The distributor also isn’t an employee—they’re an independent business whose goals may not always align with yours. Manufacturers need to remember that the real customer is further down the supply chain; the distributor’s role is to help you get your products into as many of the end-customer’s hands as possible.
- Lack of Commitment from your Distributor’s Sales Reps. Sometimes, Distributors are not realizing themselves that their own staff is reluctant from selling your Products. It could for legitimate reasons like a bad commission scheme, or less acceptable reasons.
- Failure to understand the distributor’s business. The distribution business is a margin game, so distributors will gravitate toward products that are the easiest to sell with the least effort. If your product is complex, if goals are not in alignment, and if expectations are not reasonable, it will create conflict between suppliers and distributors, which negatively affects both partners’ businesses.
- Lack of Marketing support from the Brand (your fault). Whether it’s lack of promotional and sales materials to support distributors’ sales efforts, lack of training, pricing/quality issues, or too few/outdated products—or even just plain lack of communication—a lack of support is one of the biggest complaints most distributors have about their manufacturing partners. Manufacturers and distributors need to communicate and work together to make sure that each partner has what they need to be successful.
What we would do to help you?
With our help, Distributor not selling your Product is not a big concern anymore as we can set up a system where Online Sales will shortcut your way to the Customers. Also, you will be able to do your job as Brand Owner in a better way: helping your Distributors to better sell your Products.
In a very short time, LR Data Science can process and list your Products for sale on proprietary and common Marketplaces. We want to make sure we use the Digital Marketing tools (emails, Google Ads, etc.) on our hand to reach out to a massive list of prospects.
Either we build your own Webshop using our WooCommerce partners, or we list them on our web of specialty Marketplaces. Talk to us through the below right chat. Audrey will be glad to point you to the Business Analyst expert in your industry.