You may have a completed range of health and beauty products, a stocked warehouse and the excitement built for your brand ready to go to market. But is your brand ready for your distributor?
Your distributor requires some important provisions prior to taking the lead. As a pharmacy distributor, we have created this checklist to ensure you are ready to turn your brand and your partnership with your distributor into a success.
1. Do you have a complete set of selling samples of the product for each sales representative?
Health and beauty products are visually attractive, their packaging, their fragrances, colours and textures are what draws consumers to purchase them. Providing a full range of samples to your distributor for each sales representative is an easy way to showcase all your products and the colours within the range and are an influential tool to help close the sale.
Buyers, managers and retailers look at samples to assess the quality and saleability of the products, especially with a brand they are unfamiliar with. Samples are like testers are to consumers; buyers and sales staff want to see, feel and smell the product.
2. Do you have a professional sales presenter on your product both in hard copy and soft copy?
Having a sales presenter is a quick and easy way to ensure all your product and company information is conveyed to the new distributor reps and to the new retailers. It ensures a tight marketing and branding message.
Sales representatives use sales presenters to create clear presentations that convince the retailer, head buyer or manager to buy. Being unique and eye catching, at the same time as being informative and effective keeps the audience engaged and provides all the information they need to make an informed and favourable decision.
3. Do you have training material for both the sales team and the retailer?
Sales representatives need training material to educate themselves on your products, their use, and other information such as warranties, guarantees, and consumer information. When they know your health and beauty product well, they are more likely to sell it to the manager, owner or buyer.
They will also use the training material and its information to educate the retail sales staff on the product range. It ensures knowledge and product retention long after the sales rep has left the premises.
4. Have you provided room for margin in your pricing for the sales agent/distributor and the retailer?
When engaging a distributor, there are cost savings on freight, handling, receivables financing, invoicing, and inventory carrying charges. However, you now need to factor into the price of the products, margins for the distributor and the retailer. Over the years, when talking to brands, we have found that some have not considered the scale of this, leaving them little room to move.
Understanding the role of the health and beauty product distributor will help you determine your pricing. A distributor will act on your behalf to the retailers, let’s say they are the middle-man between you and the retailer. Using the recommended retail price or maximum sales price to the consumer as the total revenue, these revenues will be split between the manufacturer (you), the distributor and the retailer.
5. Have you provided room for discounts in your pricing that you may need to give?
Keeping in mind that not all the pharmacy distributors margin is profit. Within this margin, expenses such as shipping, storage, financing, and the costs involved in the selling of your products needs to be accounted for. In addition, there may be discounts or rebates that different retailers require that need to be provided for. Some retailers expect discounts for opening orders, or ranging discounts for major groups, head office rebates; all these costs can erode the margin.
6. Do you have a mass advertising and co-operative (catalogue) budget? If so, how much is it?
While mass advertising can help in building market share and increasing your reach, the costs can be high and out of scope for most brands. Co-op advertising for health and beauty products provides a viable alternative of reaching a broader audience cost-effectively, with advertising costs shared between the retailer and other suppliers. A budget for co-op advertising should be allocated, as it is included in the contract with the larger retail groups and is not an expense paid by the distributor.
If you checked everything on this list, your brand is ready for a distributor.