Channel Institutions

BY: MUZAMIL QUADIR

Distributor/Dealer/Stockists

A distributor is a wholesaler nominated by a company to most times exclusively redistribute the company products to all retailers and institutions in a designated territory

Distributor Management

A distributor is person appointed by a company who has responsibilities for:

Buying quantities of all products and pack sizes for redistribution Ensuring full market coverage Maintaining inventory Assisting company in all promotional efforts Helps in financing the operations

Need for a distributor

• For entering a new town

• For additional coverage in the same town

• For replacing an existing distributor

Expectations from the distributor

• Achieving sales targets

• Financial commitment

• Infrastructure

• Manpower

• Developing new markets

• Managing damage stocks

• Handling complaints

• Launch of new products

Selection of a distributor

• Identify two or three appointments

• Background check

• Finding interest level

• Shortlist the final candidates

Selection of distributorIdentify two or

three prospects for appointment

Background check

Finding out the interest level

Shortlist the candidates

Selection made on quantitative and

qualitative factors

Criteria for selection

Qualitative Factors

• Willingness• Eagerness• Confidence• Willingness to spend time

in the market by the owner himself

• Willingness to abide company rules

Quantitative Factors

Parameters Weightage

Financial status 50

Market standing 15

Infrastructure 10

Present business 05

Market coverage Capability

05

Location 10

Involvement in business

05

Total 100

Further Process

• Security deposit

• Credit to be extended by the distributor

• Investment in inventory

• Investment in infrastructure

• Manpower

• Coverage of markets

• Developing rural markets

Outlet coverage

• Width of distribution

• Depth of the distribution

• Merchandising

• New accounts

• Institutional accounts

• Secondary sales and tracking

• Competition tracking

• Handling product promotions

• Managing damage stocks

• Attending to customer complaints

• Reimbursement of the cost of promotion to the distributor

Functions

Contd...

• New product launch

• Motivational tools for distributor

• Categorisation of distributors

Performance Evaluation

Future of wholesaling in India

Companies’ efforts to eliminate the wholesalers

• More outlets like metro are encouraged

• Strict price control

• Coverage focus on retailers and institutions through their distributors

Contd..... Positive Trends

• Companies still have limitations in their coverage

• Hundreds of companies who cannot afford own distribution networks

• Even book companies need wholesalers to get big sales volume

• Wholesalers extend credit to their customers

• Retailers have no choice but to visit wholesale markets