“It is not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change” – Charles Darwin
Change is inevitable. It’s also an opportunity to grow. To make the best of change you need to take action that generates real measurable results. I once managed the realignment of a brand with distributors in 30 states, during OND, (not my decision) and lived to tell about it. This is an incredibly relevant topic these days given the evolution of the wholesaler landscape with Breakthru, SWS/Glazers, the state of Washington changing from control to open, and many craft brands being kicked out of Anheuser-Busch houses due to AB wholesaler incentives.
If you refuse to act on this opportunity and think — “our brand is solid, we will be fine. . . “ — you are doomed.
Wine & Spirits Daily published an article on February 9, 2016 titled, “Survey: 70% of Suppliers Reevaluating Route to Market”. The purpose of the survey was to “gauge the temperature of how suppliers are feeling about their respective routes to market in the wake of these changes”. The article presented some of the “overarching themes” of the responses they received. Some of the results they stated were shocking.
“A whopping 71% of suppliers surveyed said they are now reevaluating their routes to market. 57% of suppliers surveyed said they believe “recent distribution moves” will affect their business negatively. The majority of these suppliers were worried about receiving less attention”, among other things.
The truth is that this time of change represents an amazing opportunity to beat your competition. This can be accomplished not only by re-establishing your relationship and stature with wholesalers, but also by securing your own fate directly with key accounts who are also navigating the changes.
Now is the time for suppliers to double down on sales efforts and organize sales teams to execute a defined strategy of high value activities to jump the curve during this tumultuous time. One of the respondents to the Wine & Spirits Daily Survey stated it best when they wrote, “Consolidation only hurts poor operators.” I will add to that by declaring that the brands that are most successful are the ones who execute their commercial strategy the best. The question is, how will you steer your organization through this opportunity?
You may not be realigning with entirely new distributors, but you will likely be working with new sales divisions and sales reps as a result of the latest consolidations. Here are 4 ways to manage these wholesaler changes to come out ahead.
Reach out to your key accounts using “Trade” CRM (Customer Relationship Management)
Realizing you cannot touch all your accounts, you really need a strategy to identify and manage those precious Key accounts that make or break a market. Key accounts are fickle, and any change with distributors is likely to disrupt your business unless you take action to solidify your position with each account. Do you have a corporate system in place to identify key accounts for your business, list buyers and key contacts in the account, and detail your history of activities and conversations with each? Do you know where your brand is featured on a menu or in a display? Moreover, do you have a plan for what you want to accomplish in the account and a planned next step?
If you are one of those suppliers who have always said, “We don’t need to do Trade CRM, that’s what our distributor does,” you will be terribly under-represented in the trade if your distributor suddenly disowns you. Suppliers who practice good Trade CRM and maintain relationships with key accounts will be the ones who maintain and even grow their distribution and visibility during a wholesaler realignment. A visit needs to be made to your most important accounts to solidify your brand presence during wholesaler changes. Maybe some telesales from the home office directed to buyers of your current customers, notifying them where they now need to order your products. How about an email blast to all buyers, reassuring them of your commitment to their success with your brand? Or a postcard mailer to your local reps, offering to fill any gaps in service they may experience during the change? The % of current key accounts touched personally by your company in the last 60 days would be an important metric to focus on right now.
Educate and engage your new reps using “Distributor” CRM
In our 3 tier system, there are 2 types of CRM: The aforementioned “Trade” oriented CRM but also the often neglected “Distributor” oriented CRM system that enables highly organized activity and relationship management against distributor sales reps and managers. We all know that this is a relationship business, but do you have a system in place to manage these all important relationships with the people who sell your brands everyday?
Distributor sales reps sell the brands that are easy for them to write orders for, and they won’t have an easy time selling a brand they don’t know anything about for a supplier they haven’t met. Has your new distributor sales team been trained on how to sell your brand? Have you met with each DM team and organized work-withs? Have you delivered your key account list detailing where menu features are in place to ensure they follow up to maintain the placement? Have you communicated your target list of unsold accounts or upcoming promotions? Do you have every reps email address and have you sent them your contact information with your latest sell sheets? Perhaps a key metric to focus on is the % of distributor teams you have met within 30 days of any change.
Make a great first impression with new distributors
Position your company with distributors as easy to work with and eager to take action to help them sell. Use any change in alignment as an opportunity to impress your distributors so you become their “go to” supplier. Present them with useful information like account lists and historical sales in digestible reports and dashboards. And get it to them electronically and early. Don’t wait for them to ask for it, because then it’s too late. Be proactive. They will see you as adding value to them if you can augment any data that they already have in their internal system with enhanced data from your own depletion reporting or CRM system. You never get a second chance to make a first impression, so show them that you are buttoned up and they are likely to call you first with any opportunity.
Allocate more resources to field sales
Mid- and small-sized suppliers have been warned that they may get less attention from distributors. Competition is fierce, so without a dedicated sales resource in the market, you are likely to miss out on opportunities in key accounts that will get gobbled up by the distributors pushing big brands or by another supplier who has a local rep in the field calling on the account. The reality is, you cannot expect to secure a menu feature in a key account unless you have a local person making it happen. This human resource is a major investment, so be sure to have a proper CRM/Retail Execution tool in place for your reps to utilize.
You must give them the tools to succeed, and you must manage them efficiently. Without a tool, your resources will be under utilized, unfocused and unaccountable. You need to take full control of your assets. There are 2 benefits to putting people in the field to call on key accounts. 1. Increase in key account distribution, visibility and volume; and 2. Distributors help those that help themselves! Your distributor will actually sell more on their own if you have a rep in the market! As Dina Opici said in a different article in Wine & Spirits Daily, “Our salespeople identify brands with a person and if that person shows that they’re supporting our efforts we’ll do anything for them.”