Sales channels to reach your customers
Selling through retailers, wholesalers and other distributors
Selling through an intermediary may be a more cost-effective way of reaching your end-customers than selling to them directly.
If you are targeting business customers who prefer to deal with large suppliers, selling directly to them may not be a realistic option. Instead, you might aim to supply wholesalers who have existing relationships with those businesses.
If individual consumers buy low value quantities of your products, the best option might be to target retailers that sell similar products. Or you might choose to focus your efforts on a relatively small number of wholesalers who can in turn supply your products to many retailers.
Other distribution channels may also reach your end-customers. For example, technology suppliers often sell to resellers who can configure and install the technology to suit end-users’ particular needs.
Managing your distributors
You need distributors who will value your product. If they sell competing products, what will make them push yours?
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Think about how you set your prices. Distributors will be more enthusiastic if they can make a large profit – but setting too low a price will eat into your own margins.
Effective advertising and promotions can be vital. As well as marketing to the distributor, you can promote your products directly to end-customers. Distributors will be keener to stock and sell products that their customers are asking for.
The key terms of the supply relationship should be covered in a written contract. Key issues might include:
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how much stock the distributor will hold
what the distributor will do to promote your products
how quickly you can resupply and minimum order levels
whether the distributor has exclusive rights to your product (for example, in a particular territory)
what happens if either you or the distributor want to end the relationship
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Merchandising … Mantra to increase visibility
Just remember the last time you visited a Mall, nearby Grocery outlet and local Convenience shops (Panwaris). Some products catches the eye of consumers – as they are in the vicinity of eye contact and others in the nook which are never observed.Lets take different situations where merchandizing will increase the visibilty and then the Brand Salience.Brands near billing counter: People who go to Big Bazaar must have noticed that Lays/ Bytes Packets are kept near the billing counter before they have finalized the other brands. Now, its not only display but the schemes on the Brands – 1 Lays Rs. 20 packet with buy of 3 Packs of Lays. It comes out to be Rs. 15 packet. Most of the consumers will put 4 of Lays in their basket. Brands in one product categories: Lets take the example of Biscuits in Big Bazaar again. There is different height for different brands on the rack. Kids prefer Sunfeast Cream biscuits – which make ITC to place their cream variant a little lower (around 3 to 4 feet) and Seet N Salt a little higher (5 to 5.5 feet). But every brand cannot command a position on the shelf or a place in general in a Mall or any outlet per se. It all depends on the Relationship and financial capacity of the respective company. Britannia may have a higher say than PriyaGold biscuits. But once you get the right area for your brand you are all set for higher visibilty and definately higher topline. Frontal Attack: Just think of a situation – A consumer entering a mall and the first thing which he observe is a good looking retail display – a stacking unit to keep cigarettes. Here smokers will get an opportunity to buy ITC cigarettes brands and at the same time it will reinforce the image of ITCs Brands. Other big international player – Malbaro has also set up these displays in different malls. Company Area: Big FMCG companies like P&G, ITC, Nestle who have the financial muscle take the whole area in a strategic location inside a mall to display all the Brands. Just think of a space where Aashirwad Aata & Namak, Sunfeast Biscuits and Mangaldeep Agarbattis are kept. People loyal to ITC products will directly go to that area and buy. There can be many more creative use of merchandizing to increase the visibility.