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Route to Market & Supply Chain Blog

RTM: An FMCG Distributor Is For Life: Not Just For Christmas

Posted by Dave Jordan on Thu, Dec 04, 2014

Ok, so maybe not for life but FMCG Distributors will have a significant impact on your sales performance, probably your personal bonus and therefore your CEO career! How have you treated them this year? Were they the usual pain in the proverbial - failing to achieve targets, not paying on time, always moaning about trading terms? Of course, some Distributors really do fit this stereotype but others are keenly trying to be treated as and to be, equal partners in your business success.

How are things going in Q4? Have you fallen into the “sales bonus push” trapYear end stock clearance FMCG breaking all the sales phasing rules you have been trying to drum into Distributors? Did you strictly maintain discipline on Sales & Operational Planning or did the last quarter deteriorate into a “sell whatever we've got” scenario?

Companies that spend time and effort in proactively guiding their Distributors and providing relevant training and support inevitably succeed in the market place. Yes, at the end of the day they have to stand on their own two feet but so many FMCG companies assume an organisation calling itself an “FMCG Distributor” knows how to support any specific business.

If you do not pay attention to the Traditional Trade (TT) Distribution side of your business then you are asking for trouble and that trouble usually ends in divorce along with all the discontinuity baggage separation brings. You need to avoid your choice of Distributors becoming like the English Premier League where managers get about 5 minutes to make an impact before being shown the door. (Strange though, that all these football managerial failures usually find another job.)

So, as we approach a special time of the year why not think about your Distributors and ask yourself if you have given them a fair crack of the whip?  If not, then you might consider a New Year resolution to develop mutual success rather than continually highlighting deficiencies and using backward looking KPIs to bash them on the head.

Sit down with your Distributors regularly, evaluate their strengths and weaknesses and agree to do something about the latter. Simply running through a Route To Market evaluation together can work wonders in establishing trust and cooperation. Do yourself a favour and do this now before Q1 next year also becomes history.

Click on the link below and go!

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Image courtesy of stock.xchnge at freeimages.com

Tags: FMCG, Route to Market, Dave Jordan, CEO, Performance Improvement, Supply Chain, S&OP, Distribution

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