Being as most manufacturing companies depend on attracting and retaining distributors to sell their products to end-users, your company’s relationship with its distributors is paramount. Both you and your distributors want the same outcome: for your relationship to be a profitable one. But it is up to your company to take the initiative in identifying what you can do to make selling your product easier for your distributors.
Here are 8 tactics manufacturing companies can use to boost business with new and existing distributors:
#1 Know Your Market and Your Potential
Before manufacturing companies make promises and define their sales targets, they must first understand the economic climate they’re distributing within. Doing so will help them discern their products’ potential for profitability and manage their distributors’ expectations.
According to the National Association of Wholesale-Distributors, Consumer spending, which accounts for more than two-thirds of U.S. economic activity, kept U.S. Real GDP expanding throughout 2016. GDP is rising at a seasonally adjusted annualized rate of 1.9% despite the negative pressures from U.S. Industrial Production and U.S. Nondefense Capital Goods New Orders, a measure of B2B activity.
This economic statistic is important because it sets a bar for expectations. Before manufacturing companies make inflated assumptions about how many SKUs their distributors should expect to move, they need to consider market fluctuations that may affect sales and communicate them honestly. You don’t want your distributors to be the first to notice such trends. Knowing this will give you time to come up with a strategy to work around any market fluctuations that could affect sales.
#2 Identify Needs and Manage Expectations
Manufacturing companies should find out – directly from their distributors – what they can do to help their distributors sell their products, and what needs or targets have to be met in order to keep distributors ordering from them. This can include expected margins, shipping turnaround, reordering processes, payment terms, packaging, marketing materials and promotional support.
Make a point of getting in front of your distributors and speaking with their sales teams. Ask them directly what they need from you and what you can do to help them sell your products. Don’t make the mistake of relying on any third parties, such as middle-men suppliers, to do this for you. No one has a more vested interest in selling your products than you do. It’s better that you have these conversations because doing so will often reveal things that you can do to improve your service model and future product design.
#3 Be Reachable, Responsive and Informative
Manufacturing companies should do whatever is in their power to make it easy for their distributors to order from them and get information when needed.
- Ensure your account managers, support and shipping department staff are easy for your distributors to reach.
- Questions and concerns should be handled with the utmost urgency!
- Ordering should be a streamlined process.
- Product shortages should be communicated well in advance.
- Payment terms should be aligned with your distributors’ accounting cycles if possible.
- Product return policies, guarantees and warranties should be straightforward and hassle-free.
But it doesn’t end there:
#4 Keep the Honeymoon Alive
After the relationship is established, it cannot be forgotten. Changes in marketing, product availability, upcoming product releases, shipping or ordering processes, products costs and turnaround, and economic factors are necessary things to be communicated between you and your distributors regularly. Your distributors want to be kept abreast of the knowledge your company obtains. They want to be treated like VIP customers. And considering the cost and effort it takes to establish a new distributor relationship, it makes sense to do whatever you can to retain them.
- Assign an account manager to each distributor relationship, and ensure your whole sales team is aware of each of your distributor relationships and any formal or informal agreements you’ve made with them. (The worst thing you can do is have a distributor call and not be recognized by someone on your sales team).
- If a distributor qualifies for expedited delivery, let your sales team know this!
- Invest in a solid CRM software such as Salesforce that will enable you and your sales team to record details about your distributor relationships and keep track of all communications and promises made to them.
- Super-serve them! Make a point of doing a little more than what your distributors expect from you. Be willing to do the little niceties that make your company more human and likeable to your distributors’ sales teams; do the things that your competitors won’t. This is one area where smaller manufacturing companies can really shine.
#5 Actively Participate in Promotions
Manufacturing companies would benefit from keeping track of their distributors’ seasonal sales cycles and promotions and then participating in those promotions by offering a value added incentive, or absorbing at least a portion of any promotional discounts their distributors offer. Make it easy and cost-effective for your distributors to promote your products and they will.
And have a presence! Don’t just deliver a bundle of marketing materials with your distributors’ next orders and expect their sales people to know how to use them when presenting to customers. Show up and offer your distributors free demonstrations for their sales teams or customers. Show them how to present your products and utilize your marketing materials. And consider customizing your marketing materials for each distributor by conspicuously including their logo and contact information. This will make them feel like you are truly invested in your relationship with them!
#6 Aim to Achieve Preference
Manufacturing companies are each vying for prominent positioning and exposure via their distributors. It’s a competitive landscape that big brands often dominate, but smaller manufacturing companies can still steal part of that spotlight. Find out what you need to do to achieve prominent placement with your distributors and preference with their customers. Consider the following elements that make your product more marketable:
- Attractive packaging that conveys your products’ quality, key features and benefits.
- Marketing materials such as info sheets, attractive callouts and hang tags, rack cards and catalogues that distributors can display with your products to address customer questions.
- An attractive and informative website that both end users and distributors can refer to for more extensive product information. (You don’t want your website to be directly competing with their sales, or they won’t send customers there for information).
- Promote your distributors via a “where to buy” section of your website.
- Prepare and have ready:
- Professional product imagery that distributors can use in their ads, flyers and website.
- Professionally designed ads that can quickly be resized or reformatted and used in your distributors’ ads and flyers (the less work for your distributors, the better).
- A media kit containing logo files (in both colour, and black and white, with transparent backgrounds) in a variety of file types and sizes that your distributors can quickly pull from and use in their ads, on their website, and in print materials as needed.
- Product info sheets and warranty information.
#7 Establish Common Goals
When preparing your manufacturing company’s sales strategy for the year, and determining sales targets per quarter, make a point of establishing common goals with your distributors. Your approach should look like a partnership: each party’s objectives aligned with the other’s. Doing so will ensure your marketing dollars are invested in tactics that attract end-user customers as well as reinforcing your profitable relationships with distributors.
Work with your distributors to design a sales approach and promotions. Plan ahead as much as possible so you can anticipate their needs and support mutual sales goals. Understand what is important to your distributor, and they are more likely to work with you accordingly.
#8 Keep Evolving
Your distributor will only stock what their customers show interest in and purchase. Your product is likely to be one amongst many and competing with big brands for prominent shelf space, or being compared to less expensive alternatives. Therefore, establishing and maintaining product appeal is critical to your growth.
While keeping tabs on what your competitors are doing, also make sure to touch base with your distributors’ sales teams to gain insight on what kinds of questions and objections they are hearing from customers about your products. Knowing this can help you stay abreast of trends and continue to develop products with features that are relevant to your end-users’ needs.
Your manufacturing company’s relationship with distributors is, in many ways, the same as the relationship between your distributors and their customers. You want to become known for being intuitive to their needs as well as for developing great products.
There are many ways to keep a relationship above par with your distributors. McAllister Marketing is a full service agency specializing in strategic marketing tactics that help you attract, convert and retain more customers. We help our manufacturing clients with everything from comprehensive marketing strategies, to preparing media kits, packaging, web design and online and offline marketing materials to increase sales. To learn more about how we can help you grow your manufacturing company, contact us today.