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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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Marketing to China’s Consumers

In China’s fast-growing market for consumer goods, most foreign companies sell premium brands to the most prosperous consumers. Several industry leaders have achieved sales of more than $1 billion, but the rest have failed to crack their first $100 million. To scale up, they will have to sell to the mass of consumers with middle and lower incomes. Few foreign companies have gone this route, however, because they fear hurting sales of their premium brands.To read more about it visit: http://www.mckinseyquarterly.com/article_abstract.aspx?ar=1472&L2=16&L3=14Moving goods in ChinaIt has never been easy getting goods to market in China; even producers of bulk goods and commodities find its transportation system cumbersome, costly, and slow. For makers of finished goods—whose needs are more complex—the situation is even worse: ships and railroads are slow and inflexible; modern trucking networks are nonexistent at the less-than-truckload level; and cargo planes account for only 20 percent of China’s aircraft. Yet the business of getting goods to market may soon become more competitive in China—with improved services the likely result.To read more about it visit: https://www.mckinseyquarterly.com/subscribe/index.aspxIndeed, China is Huge !!

 

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