If You Work with Distributors, Look Out for a Major Disruption

     

    Our guest expert today is going to talk about the major disruption that is affecting the manufacturer - distributor - end user relationships and how your company can be the survivor.

    Guest:
    Derek Weber, President at goBrandgo
    Website: gobrandgo.com

    Highlights:

    [4:00] The relationships on both sides, the manufacturer and the distributors, are ending because of retirement. In the past, the relationship was the catalyst for business, if the relationship goes away, behaviors have to change.
    [10:10] Technology will play a critical role in this disruption. The manufacturers and distributors who can work together to serve the end user will be the survivors, those that do not will not make it.
    [12:00] Here's why the end user comes out the winner, at least in the short term.
    [15:14] It's all about education and problem solving.
    [17:30] Derek shares a real life example of how a good manufacturer-distributor relationship helped an end user with a big problem.
    [23:45] The upside potential for manufacturers and distributors who can and will adjust, is huge. This is a once in a lifetime opportunity to differentiate and gain market share. But the downside is even more dramatic in a negative way.

    Interview Questions:

    Question 1: Derek, as I mentioned, this is an age-old problem that probably goes back to the first civilization in Mesopotamia. What are some tips and advice you can offer to our manufacturing marketers out there who face this challenge?

    Question 2: You mentioned technology. How does technology, the internet and ease of access to information play a role? Should distributors be worried that it is easier than ever to reach out to the manufacturer just as much as they are worried about being cut out? Maybe the days of using distributors, manufacturer’s reps or re-sellers are coming to an end, what do you think about that

    Question 3: Could you share an example of how the ideas and suggestions you mentioned earlier have worked for a manufacturer and the distributor as a win-win proposition? What type of results did they see in this example?

    Question 4: Is it an opportunity for savvy manufacturer who gets it and learns to work closer with his distributors to gain a competitive advantage over those not willing to change the way they go to market?

    Challenge Question:

    This week our challenge question comes from the VP Sales & Marketing at a Midwest plastics manufacturer. Here it is “We’re really a service provider of injection molding. Our customer base is mostly retailers. It’s almost impossible to differentiate our service from our competitors, so it almost always comes down to price. We and our competitors seem to be spiraling into the abyss of tiny margins. Do you think your idea of sharing expertise could help my business to increase profit margin and revenue? Nobody else is marketing that way in our space.”

    • Derek shares a great story about Schlitz beer and how they increased market share by sharing expertise.
    • Think about what your customer is trying to accomplish and how you can help them get there.
    • When you share knowledge and help them solve a problem, you get TOMA, credibility and reliability. Then you will get the first call.
    • The best place to find topics is in the inboxes of your service and tech support email.
    Takeaways:

    Don't underestimate the changes and make sure you're prepared for the future.
    Make sure that you're partnering with good people.

    Related podcasts and blog posts:
    MM 051 - Learn exactly what your distributors need from you to sell more
    MM 063 - Channel partner sales strategy for manufacturers




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