ManuData's partnering skilled research staff make direct contact with thousands of prospective trade partners every year.
Independent research has confirmed that 12 out of 13 Trade Partner relationships fail. The result is that most companies marketing aspirations are much too low.
Most agents and distributors are found at trade fairs and yet most failures come from partners found at trade fairs. The reason is that at least one of the following qualifications was compromised.
If one of these qualifications is missing, then you will never achieve a significant market share.
Many Manufacturers Reps and Agents believe that their partner's customers are suitable. However when carefully analyzed this often proves to be incorrect. They may be selling to the right companies but the wrong buyers. They may be selling to the wrong sectors and niches within the industry. They may not have enough customers.
These discrepancies account for many reps never achieving a reasonable market share.
For instance, if next day delivery is essential in your home market then it is likely to be required in most new territorial markets. Your partner will need this capability.
Other skills may include:
Technical ability, installation/servicing, chilled distribution, product support, marketing skills, point of sale know how,
a national sales team, a national maintenance team, problem solving skills, regular client communication, etc..
If these qualifications are essential to successfully promote your products, then it is important that you only work with a rep, agent or distributor that can verify that they have these skills.
Your rep or agent will only achieve maximum sales if they are good generators of enquiries.
Watch out for Line Collectors. They sound enthusiastic but seldom succeed. These companies are usually found at trade fairs where they pick up many other new products as well as yours.
You need to be linked with a rep or agent that is prepared to FOCUS on your products.
Do not be enticed by a line collector's initial enthusiasm!
Most Trade Partners will not invest significant finance and time to secure a good market share.
The average cost of setting up a new sales territory is $40,000 to $75,000 per year. If you would have to invest this much in staff, sales costs, travel, stock, promotion etc. then why will your Trade Partner succeed without a similar significant investment?
Be uncompromising on this point. Don't accept mediocrity from your rep, agent or distributor.
The painful truth is that even poor products well marketed will outsell good products poorly marketed.
You can address the quality of the product, the presentation and packaging, the distribution, the price, the support and still make little difference to your export success. However the quality of the trade partner will have a dramatic effect on the sales of your product.
Ideally you want a good product well marketed.
Most failures in new territorial markets are to do with linking up with the wrong reps or agents.
The same studies showed that most reps, agents and distributors are found at exhibitions or trade shows and yet disproportionately most failures come from trade partners found at exhibitions.
Most companies have projected sales targets that are only 10-20% of what they should be.
For instance, why does a company with sales of say, $10,000,000 in their home market, put up with export sales of less that $500,000 in new markets?
For some reason we accept a sales performance from our agents and distributors that would be totally unacceptable if we had our own office in that country.
It is important not to put up with mediocrity.
We are not suggesting that there is anything inherently wrong with enthusiasm but it can be very misleading. We said earlier that 12 out of 13 partnerships fail in the short term, yet you can be certain that they were all enthusiastic when they began.
Enthusiasm is pure emotion. The only way to measure enthusiasm is by investment. Will they invest people, time and money into the promotion of your products. If not then their enthusiasm is superficial and irrelevant.
If your partner can only sell with a high level of support from you then watch out, they may be the wrong agent, rep or distributor. Your best investment will be with those reps, agents or distributors that can sell without your constant support.
We have noticed that support and training almost never turns a poor performer into a good performer. It can, however, turn a good performer into a better performer.
A bad rep is good at excuses!! They blame your prices, your products, your presentation, your support and finally the culture. You should rarely believe what a poor performer tells you. It is rarely a cultural or product issue but a marketing and selling issue.