Partnering for Profit

There is no doubt that in order to achieve a high performance business one needs to excel in the development of meaningful customer insights and ways to put those insights into action.

But since no company is successful for its insights alone as success ultimately depends upon the effectiveness and reach of its go-to-market strategy.

The role of channel partners gets crucial here as they are expected by the vendor to understand what their customers want, and know how to deliver solutions that customers will buy and in order to bolster the sales a sophisticated optimization model needs to be implemented by the channel partner family.

So what is the Optimisation of the Distribution channel all about? Here is the answer-

At the most basic level, distribution partners enable suppliers to deliver goods or services to end users, and distributors’ reach In short distribution partners provide customer service in areas where suppliers cannot or do not for example financing, insurance, training, maintenance, repairs etc.

And If managed properly, distributors provide access to customers that can determine a supplier’s reach, revenue, and long-term growth potential.  Companies with productive channel relationships stand to increase sales, reduce operating costs, and improve customer reach.

An effective distribution channel management fetches benefits to all players in the value chain, often by increasing the size of the market or capturing a greater chunk of customer wallet via the channel.

Proper distribution planning can also ensure that the best available channels and distribution methods are in place to efficiently move products and services to customers.

Distribution optimization is therefore an answer to competing in new markets or regions, reaching customers where they prefer to buy, and achieving both goals profitably. The optimization spans across three phases-Current channel and partner evaluation; New partner evaluation and selection and partner management and monitoring which very much covers the entire process of driving the distribution ecosystem of a vendor

Multiple factors determine the success of a company’s distribution network (such as successful product development and marketing, the development of a targeted global expansion strategy, or the critical role of Mergers and Acquisitions in opening access to new distribution networks) and a successful and organized distribution system can really do wonders in the balance sheets of a company.