When I talk with entrepreneurs, I always hear about the idea, the team behind and how they will affect the market. One question, I never get a proper answer for: How will you sell your product/idea?
Distribution is key for any successful business. Without a good salesperson in your team you will never succeed.
The salesperson is today looked upon as an economic necessity. He helps the producers and manufacturers by familiarizing their goods, distributing them and by creating new demands. He is the key figure in the business world of distribution. You have to realize that it is the salesperson who is responsible for making it possible to distribute your products. By educating the customer to make the right purchases, the salesperson has awoken the demand for your product. Without that demand you could never sale one single piece of your product. Distribution is akin to veins through which the life blood must flow. This is why it is key that your salesperson is meeting customers and partners. We live in a digital world but people still buy only if they trust the product and the company behind. This is why you have to create a personal relationship to your costumers through your distribution strategy.
The function of distribution is often not fully appreciated. Distribution is frequently believed to mean sale. The true position that the term distribution covers all the services necessary to place the product in the hands of the consumer. You cant just post a picture on the Social Media and say “Buy me”, you have to earn trust and references. You have to create access to the market and a position on the market. You have to find distribution channels and establish a “product placement” strategy. This are the tasks of distribution and this is where distribution makes the difference between success and failure.
In today’s fast paced world, distribution can be an enormous competitive advantage to your company. Most companies target their customers far and wide. Because of the rising costs, companies are trying to expand in various channels so that they have a higher exposure. To reach far and wide, you need the right distribution strategies in place. You cannot market a product and then not deliver the product to the end customer. This is a sheer loss of money as you waste money on your marketing and the opportunity loss is also huge. Not to mention, the loss to the brand when the customer wants to purchase the product but cannot get it.
Distribution strategy is mainly decided by the top management of a company in close relation with the overall operations. This strategy can be summarised with three main points.
- How to get the product from the manufacturing point to the end customer
- How to control costs and save time while executing the distribution strategy
- How to build a competitive advantagethrough distribution
HERE ARE 3 MAIN DISTRIBUTION STRATEGIES
Distribution is how a business makes their value proposition available to customers. There are three main distribution strategies:
- Direct– company-owned channels
- Indirect– 3rd party channels
- Hybrid– both company-owned & 3rd party
By creating your distribution strategy, there is no right or wrong. You have to understand your market and your costumers to find the perfect distribution strategy.
However, two things you should never under underestimate – the people who work in your distribution department and that your innovation always have to be innovative.
Do not try to copy your competitors! Try something different and find your own way. It may make sense to reexamine your distribution model and take some time to think through if you have the right distribution model for your situation or you need to innovate. Do it with your team and you will succeed.