Many companies think of their distributors as an expense to be minimized. However, Thomas McDermott of Chicago-based Machine Marketing advises companies to view them in a different light.
"If distributors are part of your channel, you should view them as a much more valuable asset," McDermott writes in a recent post on New Equipment Digest's LinkedIn network.
"With your help, they can become champions of your products."
But the playing field has changed in recent years.
Mass distributors such as Grainger and MSC Industrial Supply "have become forces within specific vertical markets." They wield ample power to "dictate price and even influence new-product development," explains McDermott, who calls them "one-step distributors."
"Just like a dealer, companies like Motion Industries and Grainger have a showroom, salespeople, a counter and an inventory of products," McDermott writes. "And like with dealers, you must follow the same three-step process to success."
McDermott offers these three keys to success:
- You need distributors to carry you. If they don't carry you, they can't sell you.
- Become the preferred brand or company for the distributor.
- Help the distributor outperform its market and sell more than its competition.
McDermott offers the same guidance for making inroads with two-step distributors. However, in Step 3, "you need to help them assist their dealer customers in outperforming their markets," he adds.
For more, join New Equipment Digest's LinkedIn network
(it's free, of course) and read "How to Grow a Distribution Network."