How do dealers find new brands that make money?

How do dealers find new brands that make money?

For dealers, new profit growth points can be found only by constantly finding new brands with development potential. However, the most worrying about taking over new brands is risks. How to reduce risk factors, selecting new brands that make money is the key to dealer development.

Dealers should avoid three major risks brought about by new brands

To select a new brand, dealers should first fully consider and avoid the risks brought about by new brands. It is a wise choice for successful dealers to consider how to "not lose money" before making money. Dealers who are often moved by the bright future and ignore the risks are the most likely to suffer losses.

1. risks of new brand cost investment

The investment in new brands has always been a challenge for dealers. Despite the fact that manufacturers have to pay a certain amount of fees to reduce dealers' concerns and even provide a considerable amount of goods, the market development of new brands, after all, is based on the joint investment of both parties, if the total cost is higher than that of the manufacturer, why should the manufacturer find the dealer? One of the purposes of finding the dealer is to share the risk of the cost, along with the various support conditions of the manufacturer, the dealer is required to give a small amount of the first order, if not sold, how many manufacturers will be refunded to the dealer in full, not to mention the expenses that dealers will spend on entry or brand promotion.

Risk Avoidance Methods:

No matter how attractive the prospects are, you must be cautious when cooperating for the first time. You can negotiate with the manufacturer to test the product quality and consumer response before signing the contract. Determine whether to invest in the new brand based on the test results. For example, you can let the manufacturer fully bear the promotion cost for one month. If the effect is acceptable, then the dealer can consider investing in the marketing of the new brand in proportion to the manufacturer.

2. credit risks of new brands

As a distributor to take over a new brand, there is also a great credit risk, we know that dealers must have a good relationship with the store, in order to more easily obtain preferential conditions and store support in the store. In addition to personal and emotional communication, a good relationship is more important. The brand operated by the company can bring benefits to both parties. After all, it is a business discussion. If the brand's sales are unsatisfactory, it will also lead to loss of trust in the store.

Mr. Wang is the manager of Company A responsible for the sales of store B. Manager Wang has always had a good relationship with Chief Li of the department for food and beverage of the store. However, Mr. Li has recently warned Mr. Wang that, without increasing the sales volume of C health care products, he had to dismount the C brand and complained that the C product had been "approved" several times by the leaders due to the unsalable effect of the c product, said Mr. Li did not fully realize the economic value of shelves, and found some unsalable products. So Mr. Li complained to Manager Wang. Manager Wang shook his head helplessly. In the past, all the agent brands were operating well, and the relationship with the store was also very harmonious. That is, the C brand that took over the relationship between friends affected his credit, as a result, other brands are also affected ".

Risk Avoidance Methods:

First, look for a Single-store to first enter and check the sales of new brands, because the chain stores with multiple terminals are an important resource for dealers, and it is not easy to "test the water ". Second, you should first look for a local store, rather than a foreign store, because the operations of foreign store are generally more formal, once the problem occurs, there is not much space to solve the problem. In China, especially local stores, the relationship is more familiar and easier to talk about. In case of any problems, the credit crisis can also be resolved through "emotional communication.

3. Risks of the new brand "crossing the river and bridging the bridge"

Due to the need to cultivate the market for new brands, most dealers are unlikely to make money in the first year. Experienced dealers gradually accept the fact that new product brands do not make money in the first year or even two years, however, after a long period of human and material resources, new brands gradually become larger, and new brands with greater initiative are somewhat unrecognizable, so that the dealers who have worked hard in the early stage do not get the final "Fruit ". Some new brands may switch to more powerful dealers or assign scattered management rights to larger dealers. For example, if an enterprise is not strong at the beginning and its market prospects are unclear, it cannot find a proper provincial distributor and directly uses the municipal agent as a level-1 agent. After one year of development, the product market is doing well. At this time, we will cooperate with provincial agents with greater strength to fully develop the market. Therefore, we will notify the previous municipal dealers to either switch to level-2 agents or not to renew their services. In this way, the dealers who previously paid the most for the new brand cannot get the maximum return.

Risk Avoidance Methods:

If the dealer signs an agency contract on a yearly basis, you can add a note in the contract that if the new brand reaches a certain sales value, the dealer has the right to automatically renew the contract as agreed in the previous contract, otherwise, the manufacturer defaults and compensates the dealer for the brand construction fee in the early stage. In addition, if a new brand develops to a certain extent, the establishment of the brand's operating company jointly funded by both parties is a way for dealers and manufacturers to develop together, share risks, and share profits.

How to select a new profitable brand

I have been familiar with many dealers with outstanding performance and often talked about how they select new brands among many products and ensure a high success rate. I have summarized the following points for your reference.

1. Do not add too many new agents each year (1-3 agents per year based on actual strength), which reduces risks and improves survival.

The operation of a new brand requires a large amount of manpower and material resources. If you do not spend a certain amount of energy on the new brand, it will be difficult to develop. If there are too many new brands on behalf of the new brand, you will not be able to take care of it, so focus on one or two projects, and the chances of success are even greater. A provincial-level food dealer wants to pass the relationship every year and hopes that they will always choose only three of the hundreds of brands they represent. Once the three products have been taken over, they will not consider the best products. The company Wang said: the best products, just rely on "self-Touch" (not very managed, natural sales) it cannot be done either, so even if you have a lot of good products in your hand, it will only make you confused, and none of them will do well. On the basis of ensuring the stable development of existing products, we have made some effort to focus on the new products, which is much better than doing one thing.

2. There are too many competing brands, and products that are saturated in the market do not act as agents to avoid fierce competition.

Currently, most products are highly competitive, but too many competing brands are more difficult to develop. Just like the current beverage, it is very difficult for an unknown new brand to enter the market because there are too many giants in this industry, you can see that there are more than a dozen brand products on the shelves of convenience stores, and they are all big brands. As a new brand, there is no place for you, it may be difficult for consumers to pick this new product among many well-known products. Therefore, regardless of how powerful the manufacturer is and how distinctive it is, do not represent the products of this brand. The market is the market. The manufacturer believes that its products are unique and will stand out from many products, it's just a good wish, not a reality. Never trust it.

3. Be careful when the profit margin is too large.

Many dealers once said that in the fast-moving consumer goods industry, a normal profit of 10% out of expenses is a good product. The profit of general products is only a few percent, there are only two results for a product with a high profit margin: first, a high price and a large profit margin. Many competing products will enter immediately, and a high profit will not last long. In addition, it cannot be sold. The price is significantly higher than other similar products, and consumers are not dummies. It is unrealistic to spend more money to buy your products for publicity. From the store point of view, the quality is guaranteed, and the price is a little lower than that of similar products, it is easy to sell. In addition, such a high profit margin also represents the speculative and immature operation by manufacturers in the market. Therefore, we should be more careful than being tempted by "high profits, I forgot which ones are just flowers in the mirror and water in the moon.

4. Prioritize local enterprises with potential

Generally, an enterprise's home door is definitely a test field. If you look at the places where the enterprise's headquarters is located, most of the products of these enterprises will not do very poorly. This is a face project of the manufacturer, this is also because the manufacturer has many advantages locally. Many of the products of sibao.com rank first among similar products in the Wuhan market. hengan group must be the leader in sanitary paper products in Fujian, and Guangming is the leader in Shanghai dairy products, these prove the advantages of local enterprises and witness the consolidation of the base at all costs. The first local distributors to cooperate with these brands have been launched. If dealers can seize the local enterprises with such development potential, they will find a gold mine. There are few intermediate links and high profits; any problems can be solved by the manufacturer at any time; more marketing efforts and many other benefits ensure that dealers are absolutely profitable.