3 Questions to Develop Your Channels of Distribution Strategy

When developing a new product or service, one of the first things to consider is how to get it to the end-user. Deciding on what channels of distribution to use is a very important business decision that must be made correctly. Using the wrong channels of distribution costs you money and depletes the value of your product.

1) How does the end-user want to buy?

To answer this, you’ll need to understand your customers and your relationship to them. How does your customer prefer to buy this product? Will they need customization or regular service? Maybe your customer needs other products or services to be able to use your product. Once you know your customers’ needs, you can develop a strategy for your channels of distribution.

2) What is your distribution strategy?

If you’ve decided your product is easy to buy and is pretty straightforward, consider selling directly to the consumer through a catalog or website. Products that require lots of customization or that require regular service may be better distributed through a sales team. Maybe you’ve determined you benefit mostly from selling in large quantities or bulk; then it is probably best to consider a wholesaler/retailer channel. With proper planning, you can use multiple channels to get to different customers in a variety of geographic areas or various vertical markets.

3) How are you providing support for your channels of distribution?

No matter what channels of distribution you choose, remember that each part of your distribution channel is your customer. Once you’ve gotten a distribution partner on board and they understand your value, it will be your turn to step up. You’ll need to provide the necessary training (always required), let them know the service requirements, help promote your partners and be sure to deliver the product and supporting materials on time. Be as thorough as possible and follow through on all agreements.

Remember that your channels of distributions are not only customers, but partners and even assets, not just means to an end. They are the trusted advisers of your potential customers. As the old cliche goes, you’re only as strong as your weakest link. In this case, your product is only as strong as your weakest channel.

Channels are not free.  Support of time and money may cost more for one channel partner than one direct customer.  With the right channel partner, you get hundreds of end user customers that you wouldn’t have gotten any other way.  One plus one can equal one hundred.

Contact us and let us help you develop a powerful channel strategy to drive your business’s success.

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