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The Sales Channel management

The Sales Channel management

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Product Description

The sales channel is equivalent to a canal and aisle and is the carrier for connecting and carrying products and services.

At both ends of the carrier can be enterprises - dealers, agents, wholesalers, large retail terminals;

It can also be a regional agent, a wholesaler, a distributor – a second or third or even smaller distributor or a husband and wife shop.

In short, the consumer of the final product and service is not obtained from the original manufacturer.

(After 2 and more than 2 links), it can be called a channel. Such as: P&G, Wahaha, cola, etc.

The sales channel is one of the most important asset values of the company and the most variable asset. It is the path that companies take in the process of transferring products to consumers. This path includes the company's own sales organization, agents, distributors, retail stores and so on. For the product, it does not add value to the product itself, but increases the added value of the product through the service; for the enterprise, the sales channel plays the role of logistics, capital flow, information flow and business flow, and it is difficult to complete the completion of the manufacturer. Task. Different industries, different products, different scales and development stages of enterprises, the form of sales channels are different, and most sales channels must go through the two links from dealers to retail stores. In order to meet the needs of retail stores, and to maximize their own profits, few dealers only represent one product, but have their own product portfolio.

These are useful means

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We know that dealers are guarding one market, have sufficient social relations, have a sound sales network, and have a market-tested sales force. His short-term interest is to make money, long-term interests are to develop, and the goals and manufacturers are not the same. So what means does the company have to "control" the dealers? The following five methods may give you the answer.

Vision control


As stated in the Fifth Practice, corporate vision is a top priority for business leaders. A company without a vision is a company without a soul, a company that only makes money, and has no future. Although the quality of domestic distributors is generally low, it is normal to have no long-term planning for themselves, but for manufacturers, they must have their own vision. Because every business must consider the development of their own home, the market opportunities are limited, I mainly do the distribution of the company's products, and also means that I am likely to give up the distribution of similar products. If a company has problems in operation a few years later, Company B is very prosperous. Then the dealer paid a huge opportunity cost when choosing to go home.

Based on this consideration of dealers, enterprises should use the performance of the market to prove their excellence. On the other hand, enterprises should constantly describe their bright prospects to dealers, and we call them [spits." The dealer recognizes your company's philosophy, the company's development strategy, and recognizes the company's main leaders. Even if the temporary policy is not appropriate, the temporary product has problems, and the dealer does not account for it. The specific practices are as follows:

1. Inspects and visits by senior executives: Directly communicate and communicate with the top management and dealers of the company to establish personal contacts. Through senior leaders to convey the company's development philosophy and look forward to the company's development vision, such initiatives can enable dealers to better understand the company's current situation and future development.

2. Publications within the enterprise office: Regularly publish corporate leaders' speeches and market conditions around the country. It is best to start a dealer column and let the distributor's comments and suggestions become part of the publication. Regularly send the publication to the dealer's hands.

3. Dealer's meeting: The company regularly holds dealer meetings, and praises and motivates dealers with good performance at the meeting. The company's various policies are promulgated, and a discussion meeting of dealers must be held in advance. In this way, the dealer has the sense of participation of a member of the company, and feels that he is part of the enterprise, and his own development is inseparable from the development of the enterprise.

Brand control

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The modern business society is a society in which products are homogenized. The only characteristic that often distinguishes products is the brand. The brand is the most important asset for many companies, so the owner of the Coca-Cola Company dares to say: Burn all my factories, just give me the Coca-Cola brand, I will do the same today. Some brands, like McDonald's, Pepsi, and MTV, have existed out of the product, becoming a culture, becoming a kind of value, and becoming a religion.

From the perspective of channel management, product brands have an impact on the entire channel through the impact on consumers. As a dealer, we must also establish our own brand, but the dealer's brand can only play a role in the channel and have less effect on consumers. Often the dealer's brand is attached to the brand of the main products, and without the support of the manufacturer, the value of the dealer's brand will be greatly reduced.

For dealers, what is the role of a brand-bright product? It is profit, sales, and image, but the most important thing is the efficiency of sales. Generally speaking, the price of the best-selling products is transparent, the competition is fierce, and it is not the main source of corporate profits. However, the sales of the best-selling products need to be less competitive, so the sales cost of the dealers is relatively small, and the sales of other products will be driven. This can be used to find profits from other products, and because the sales speed is faster, the turnover rate of dealer funds is increased.

Therefore, as long as the company has established its own good brand image on the consumer level, it can exert influence on the channel. Through this brand, the sales cost of the dealers is reduced, which leads to an increase in sales efficiency and a sales control channel.

Benefit control

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The above method can be said to control the dealer in terms of service, and consider long-term cooperation with the dealer. But every business is guaranteed by certain Benefits, especially short-term benefits. How much does this short-term benefit give to the dealer? We often hear sales representatives and companies want policies: give more rebates, give a good price, if not, customers will not do with us. Is this really the case? If the dealer does not do with us, he is still operating other products. The variable cost of the dealer will not be reduced in the short term. Fixed expenses such as rent will occur, and depreciation will occur. If the profit of the cooperation is lost, his overall profit will be reduced, and the cost will not be reduced. That is to say, he is likely to lose money, so the conversion risk is too great, he is not willing to take it. At this time, we will fully respect the opinions of the company. That is, the company controls the dealer

So when is the dealer's risk small? If the profits that the company brings to the dealers are small, he and the company will not be able to cooperate, and they will still be profitable. Then, such a relationship does not matter to the dealer, and the company does not control the dealer. Therefore, the dealer's control in addition to the above services, but also in the interests of control, to give dealers enough benefits. In other words, the profit of the company to the dealer is greater than the profit of the dealer. Only at this time will the dealer feel the pain when it "breaks up" with the company. It is the company that has the final say and control of the dealer. There are five specific methods:

1. Increase your rebate and discount, so that you can increase the profit of the unit to the dealer.

2. Increase the sales volume of your products.

3. Reduce sales of other products of dealers.

4. Reduce the unit profit of other products of dealers

5, increase the cost of dealers

The above five methods, the first two methods are adopted by the general enterprises, through continuous promotion activities, continuous channel rewards to stimulate channel sales and unit profits. The essence of the two methods in the middle is to crack down on competitors' products and reduce the sales and profits of the opponents. The fifth method is to make a big loss to the dealer. It is best not to use it because the value of the channel can be distributed at a lower cost. If the dealer's cost is too large, its existence is unreasonable, and the control is not controlled. No meaning.

The above analysis is only a perceptual understanding, and the method of inconvenient measurement, the sales analysts are most exposed to the specific sales volume, not the profit. The following quantified method is used to indicate that [the profit to the dealer is greater than the net profit of the dealer". Assumption: the total sales volume of the dealer is Y, the sales volume of the manufacturer is X, the unit profit of other products is T2, the unit profit of this product is T1; the net interest rate of the customer is M.

The formula for the manufacturer to control the dealer is: X*T1"M[X*T1+(Y-X)*T2].

Change the formula to become: X/Y"1/[(1/M-1)*T1/T2+1]

From the above formula, we know that the company's sales volume should account for the proportion of the total sales volume of the dealers. For example: the example of the mobile phone industry, the unit gross profit of other products is T2=20 yuan, the manufacturer's unit gross profit is T1=20 yuan, the dealer's pure interest rate M=1/3, then X/Y=33%, which is this If the manufacturer wants to control this dealer, his sales volume should account for 33% of the dealer's sales.

The above formula is only a rough estimate, and the actual operation of business is not so simple. Every sensible business or manufacturer must think twice when making channel changes. When the manufacturer switches the dealer, the customer has already been selected. When the merchants switch manufacturers, they have already chosen a new family, and there are few sudden changes without warning. But no matter what, the above formula X/Y is the direction of every sales representative.

If the company has established a great vision and made the distributors agree; if a good brand image is established in the minds of consumers; if the company cultivates a team of customer consultants and truly serves the enterprise; if the company controls the terminal, and Established good communication with the terminal; if the company can bring the benefits that the other party can't refuse. The future of this company's development is ambitious. The first-class channel formed by controlling the dealers in this way can grasp the development of the industry, realize the true network as the king, and establish the style of the industry leader.




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Product Categories : Marketing And Distribution > Chinese Market Overview

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