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Finding a Sales Distributor

Get your product out to the masses by hooking up with a sales distribution company.
November 1, 2005
URL: http://www.entrepreneur.com/article/80784

Editor's note: This article was excerpted from Successful Sales & Marketing.

Happy are those manufacturers who sell their products directly to consumers. For them, the assembly line (through their retail outlets or direct-mail arm) empties right in the customer's hand, and the money paid goes right to the manufacturer.

For most manufacturers, however, life just isn't that simple. To illustrate the dilemma of distribution, let's put you into the tea business--as Tastee Tea. You purchase tea from all over the world. You make a number of delicious blends: some induce sleepiness, some a sense of well-being and some wide-eyed alertness. You mix those tea blends with a number of aromatic essences and flavors to produce, say, 12 different teas. When the tea is done, how do you physically get it to the customers?

If you sell your tea only to the local market, all you need to do is put a retail outlet on the front of your plant, plug in a cash register, run a few ads and there goes your tea, moving out the front door. But selling only to your local market severely limits the amount of tea you can sell. How far will people drive to get tea?

If you want to sell your tea in other parts of the country, how can you make that happen? You have several choices:

  1. Will people come to a tea store? I don't know of any that just sell tea, do you? Even coffeeshops are carrying more and more baked goods because coffee by itself doesn't draw enough traffic.
  2. Is this really the most efficient way to sell your tea? Making tea doesn't give you expertise in running teashops.

Who Are These Distributors, and What Do They Do?
When you turn on your water tap, water happens. Wonderful, isn't it? You've got your hot; you've got your cold. It's clean, dependable and cheap. How does that water get to you? Chances are you haven't a clue--and you probably don't care. Depending on where you live, you have large-scale municipal water or a local or private well. It's the same with electricity and natural gas. These things make your life easier, but it doesn't make much difference how they get to you, just that they do.

Distributors in the American marketplace operate the same way. They're invisible to most consumers. Their names mean nothing to the people who enjoy the products they deliver. But they effectively (if not always efficiently) bridge the geographical gap between producer and retailer. Supermarkets and department stores couldn't exist without a complicated distribution system, capable of moving enormous amounts of product of every size and description.

Distributors add millions to the cost of the products we buy in the supermarket. But from the manufacturer's perspective, they deliver a lot, too.

From the retailer's perspective, distributors provide the following main benefits:

Finding a Distributor for Your Product
The distribution channel you select for your product should be based on a careful analysis of the needs of your product in the marketplace.

How can you motivate distributors to carry your line? This can be difficult for companies and their products breaking into a market that's already flooded with other similar products. If you have an idea for a new plush toy, for example, you will have some tough sledding unless you can find something in your product that's genuinely unique and attractive to the consumer.

You can base your pitch to the distributor on a range of rationales:

Remember, you're marketing to the distributor just as much as you're marketing to the general public. If you can't persuade significant distributors to handle your product, you'll have a very difficult time breaking into the marketplace in a big way.

You can probably find local distributors for your type of product in the Yellow Pages, but that's not the best place to look. When you need a new banker, lawyer or accountant, you usually look for word-of-mouth referrals, for the endorsement of someone you know and trust. It's the same with distributors.