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Do you have a bad distributor?
Nearly every company finds themselves stuck with at least one bad distributor. Sometimes it happens, despite the best evaluation process or because things change.
But all too often, it happens because there’s not enough up-front work. Your company may get introduced to a company or are approached by prospective distributors, promising you hefty sales numbers.
It’s tempting to sign them up, thinking that whatever they sell is upside. After all, they know their market, so they must know something you don’t!
Plus, you don’t have any other options at the moment, right? And why wait or spend money when you could be making sales now!
Choosing the wrong partner, however, is one of the worst mistakes you can make when trying to grow your exports.
Many companies do not realize just HOW badly it hurts to choose the wrong distributor. In addition to the lost investment in this distributor, and the poor sales results for however long you keep them, ending things with your current distributor and starting with a new one is usually not like turning off a faucet.
Here’s a typical sequence of events, based on our experience and interviews with experts having 100+ collective years in this business:
Total elapsed time: 36 months., if you’re lucky. Clearly, this timeline might be shorter. But we know of many cases where the timeline was considerably longer. Sometimes a LOT longer.
Especially if the old distributor stirs up trouble or has a long history of disappointing local customers,. It may also take a long time to re-register your products. And some products have a long sales cycle, further extending the time before you’re truly back in the market.
What should you do instead? Make the time and spend the money necessary to pick your distributor partners wisely.
How do you do that? Invest enough time upfront to get to articulate clearly all of your expectations. Many companies skip this critical step.
And then get to know your potential distributors. There are companies and services like Blue Sky Consulting that can help you design a program that’s right-sized for your company. And you can outsource all or parts of that process.
If by doing this, you avoid one bad distributor (and you’ll likely avoid several), this is a good investment. Conversely, picking the wrong distributor can be very costly.
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