What's the best way to find/evaluate a good distributor?
I have an online retail business, and I'm looking to find a good distributor to help expand my business' reach. How can I find a quality distributor, and what should I keep in mind when devising a strategy with them?
Before appoint any distributor check his distributor net work his sales man qualification ,work experience and most important did he has a good companies to distribute there product
In addition to some of the advice given, you also need to evaluate how important will your products be to the distributor, and what margin can you afford to give the distributor in relation to other products they carry. You may have to give high margins to make an established distributor serious with your products.
Research who distributes other similiar products in your category. Also find out once you have the interest of a distributor what other lines they represent. Most good distributors carry quality branded products. Once you have a relationship you can then start to discuss strategy as well as potential partnerships. Good distributors can really help grow a business if you can build trust with them.
While evaluating the distributor you have to check their past records of sales and the network in addition to it the interest level they have towards sales. It has been observed that many people joins/ apply to distributorship because of commission but when they find out that the area where they work wont give them the customer and the number of sales they drop out hence identifying their interest toward the segment / product and their network becomes essential.
In addition distributor seek more training or support part from the company you have to be sure to work with those who are self motivated towards business and the sales then they will generate the numbers for your company but in case you are wasting your time on training and motivating them always then why to join them .
There are many aspect to be considered however mentioned essential one hope this helps
Usually an online business and a distributor do not go hand in hand. The advantage of an online business is you can build a community of people that want to buy your products and you can interact with this community for ideas on new products, what sells etc. On the other hand a distributor handles multiple vendors and you would need to provide sales training on your product and a wholesale price structure. Does your price structure allow for the insertion of a distributor? You also have to hold the receivable and have a return/shipping policy for inventory etc. Usually you need to provide a fair amount of inventory to feed the funnel and samples. This is a much more 'hands off' process as you are one more step away from the customer. These are all things to think about before deciding if the distributor setup is best for your business.
First of all you should identify the parameter of business expansion, i.e. Product and/or services. Then you can contact the manufacturers whether they supply directly to retailer or thru distributors network.. and take their recommendation on delivery system and payment terms. Delivery terms and efficiency is very crucial while getting into trade agreement becoz it is the retailers' customer is at stake as goodwill and face values to their customer.
Hello Lynn , Its not difficult to find or evaluate distributor , You can ask for the total quantity of products distributed within a particular period of time -Say one year more or less , You can ask for Sales reports for previous year , you can ask for the quantities Vouchers , my documents you may ask for which proves that he can be good distributor .
You really cannot use the term 'distributor' and 'online' simultaneously. You want an 'affiliate marketer' who you give commission to in order to send traffic to your online retail business or you allow that affiliate to market your products independently. Alternatively, if you are shipping your products OUTSIDE the USA, exporting, you can work with the US Export and Trade Association. These people work exclusively with Americans wanting to export and their Consulates around the world interview and list potential distributors for you. You may want to export your items to foreign countries so that foreign nationals either set up their own online retail store or sell wholesale as many countries still utilize 'mom and pop' type brick and mortar retail or even help them set up their own online store. I have helped many put their strategies together. There is no one answer that will be best for you - you must individually look at what your business is, your budget, is it part time or full time job for you, and if you do not have a business/marketing plan, you must make one.
Hope this helps
Not only your strategy but also You have to look at the anwsers at the following questions :
- his network of customers
- Since when does he exist ?
- his pro-activeness, the way he will promote your products
- take care - because it's the case in Belgium - at his representaiton in all the
regions (in Belgium we have the problem with Flanders and the German-
- check also the way that distributor will pay your envoices !
- Also will he accept your strategy : imagine that internationally your products are
top-ranked ones or premium and that in his region, in order to make volumes,
he would sellthem to discounters !
- Last but not least I hope for You that he doesn't sell already the same kind of products from your competitors and that he would sell products on which he earns much!
Market reach through distributors/resellers should be part of a comprehensive marketing approach (strategy) within your overall business strategy which may extend to 5 years or more.
Based on what you have in your marketing approach and your business strategy, there should be some clear business model descriptors (elements) that will serve as guidelines regarding what you want to achieve.
Dealing with one specific entity ( a distributor for example, a partner, a supplier, a customer or even a sales lead/opportunity), you'd better have some special templates (blank forms) that contain the brains (intelligence) of the qualification process that you need to go through with your candidate distributors, resellers, partners, ... etc .. etc.
If you do not have the above in place, then may I suggest that you need to do so to have a solid platform that you can rely on and build upon your future business model?
Where ever you are, look for a trade show, in your area, for your market and talk to the vendors. You'll learn more in two days, about vendors and distributors, than 8 weeks searching online reviews.
First, what type of 'retail' (i.e. what types of do you sell) is your business? Finding a distributor is dependent on the industry you're in. Each has its own norms and what to look for.
Second, why do you want to add physical distributors? The main benefit of using the Internet as your 'distribution' channel is that there are no borders. You can sell to whomever, wherever. The question then becomes how do you get customers to visit your online store.
In general, the following are some of the questions to ask of prospective distributors.
1.) What's their annual sales?
2.) What's the geographic area they cover?
3.) How long have they been in business?
4.) How many salespeople do they have?
5.) What other product lines do they represent?
How are you going to do business with them?
What are your terms going to be?
Do they have to carry inventory? If yes, how much?
What payment methods will you accept?
How will you conduct business with them, via PO, EDI, e-commerce?
How are you going to support them and their efforts?
Will you restrict their territory?
Have you reached out to industry trade associations and get information about the typical operating procedures, etc.?