Many products are sold through dealerships or networks of interim sales elements tied to the brand name. An important advantage here lies in spreading sales efforts over a larger amount of stores.
A disadvantage lies in controlling the marketing and sales processes. Afterall, these dealerships can choose between multiple products, brands and suppliers. The biggest challenge is gaining and keeping their loyalty. If they're satisfied with the dealer proposition, that may lead to a strong growth of sales across the whole network. A powerful dealer strategy contains at least these elements: the right selection of products, the right margins, training and service, intelligent marketing communication tools, pull marketing and prospect / lead rewards. Time, money and resources are often scarce and profits are the most important target, so segmenting and managing your dealer channels is crucial.
Internet and new distribution insights influence commercial results. Customers don't always stick to one supplier anymore. For instance, they can now buy their health insurance through the local football club, as it's made arrangements with the insurance agency. Their DELL computer is bought at the local supermarket, not the computer store. The grocery store allows credit, national organisations offer cheap law insurances for businesses. Business-to-business markets are showing changes in distribution as well: companies have to pay attention to possible partnerships for certain target segments. It's expected the partner market will be divided over the coming years and considering partnerships are always aimed at the long term, it's of great importance to design a strong distribution strategy. The organisation has to be suited to the distribution strategy. Good distribution partners can allow for larger volumes, new target groups and lower costs.
