Wholesalers generally buy existing products from manufacturers or importers in large quantities and master cartons. Then, they offer the product to retailers in smaller quantities and in units or small boxed amounts (5, 6, 10, 12).
Wholesalers who sell mom and pops are generally called Wholesale Distributors or just distributors. Those who sell groceries are commonly called Brokers. Some are also called jobbers for grocery, drug, and other chain stores. Those who sell entire sections in chain discount and other department stores are sometimes called Feeders.
While most products carried by wholesalers are stock catalog items offered by manufacturers or importers, it is uncommon for the wholesaler to buy direct from exporters rather from importers. Normally, wholesalers require specific product designs, packaging changes, or inner and master packing preferred by the wholesaler. This might be due to their own desire to differentiate themselves or because their customer asked for something special.
When a manufacturer or importer desires to sell through distribution, they do not eliminate their need to market the products through the rest of the distribution chain. Therefore, the manufacturer needs to sell all the following layers:
DISTRIBUTOR BUYER, including his management.
DISTRIBUTOR SALES FORCE – They have many products to sell. You need to get their attention.
RETAIL BUYER, including his management
RETAIL SALES FORCE
As you promote to these various levels, you might think in terms of pushing product through the pipeline. You have sold the wholesale items, but now you need to push them off onto the retail display unit. You can also see your role as pulling products through the pipeline. You convince consumers to go into a store and ask or buy the product. You also convince retailers to ask the wholesalers for more stock.
How does your SALES ORGANIZATION fit into this effort?
HOUSE SALES – This might be customers of the owner or sales manager where no commission is paid.
IN-HOUSE SALES TEAM – These are W2 employees who are paid with a combination of base pay and commission. They generally have a geographic and industry-specific territory.
SALES REPRESENTATIVE AGENCY – There are independent representative agencies in most industries. They offer solid relationships with your prospects due to years of selling them a range of products.
Some representative agencies will be strong with customers 1, 2, 3, and another agency might not be strong with 1 and 2 but is strong with 3, 4, and 5.
LIKELY WAYS TO STRUCTURE SALES TO WHOLESALERS:
Most representative agencies are paid straight commission, but some may require guarantees or other payments for attending shows, doing store sets, or traveling to see your customers.
WHILE IT WOULD BE POSSIBLE TO WRITE AN ENTIRE BOOK ON HOW TO MAXIMIZE YOUR SUCCESS USING IN-HOUSE OR SALES AGENCIES TO GENERATE BUSINESS THROUGH WHOLESALERS
ALWAYS PAY YOUR AGENCY REPRESENTATIVES ON TIME. They are generally in the power position unless you are a major part of their income. Late payment is likely to get you fired.
Whether in-house or agency, keep them supplied with fantastic samples, displays, and collateral materials. Salespeople feel naked if they don’t have props. Agency salespeople will be way more likely to give your lines more time in front of buyers if they have props.
RUN DEALS OFTEN – PROPS ARE GREAT. Deals, new products, new packaging, etc., are even better.
SALES MANAGERS AND OWNERS NEED TO TRAVEL IN THE TERRITORY. Your salespeople will pull the wool over your eyes, and no matter how good they are, they aren’t as good as your sales manager or you. You need to have management in the field often to find out what is really going on, and to be able to close deals and make snap decisions.
FOR IN-HOUSE SALES, HAVE SALES MEETINGS OFTEN, EVEN WEEKLY. For representatives, have meetings at your facility at least annually or potentially quarterly. These should be at least partially for brainstorming. There should have seminars or workshops at least for learning or constructing new ideas, creating opportunities as you are to teach and motivate.
If you are not sure which agency to put up in a certain market, do a survey. Ask the buyers or the buyer’s assistant. They all have their favorites.
LET’S JUST MENTION A
FEW MAJOR FACTORS:
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