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Key To Building A Distribution System For FMCG Business

The competitive environment among enterprises is increasingly fierce, especially competition in fast-moving consumer goods (FMCG) sector. Thus, distribution channels are considered as the “strongest” weapon of enterprises in this race. Successfully building a brand with good products is just the first step in this race, as the important task to bring the products to customers is to build a strong distribution channel to meet customers’ needs at any time.

1. What is building a distribution system?

Building a distribution channel can be understood as building a market segment based on geographic surveys and customer demand, which is the fastest and easiest way to reach your target audience.

Effective distribution channels will help enterprises anticipate market demand, user tastes, and product quality. Revenues and profits will be maximized through distribution channels, contributing to building a stable growth and increasing value for the company.

2. Building a distribution channel strategy:

The first strategy in building a distribution channel is conducting market research and analysis, identifying the factors that affect the distribution system such as geographic limitations, market demand of customers, and distribution of sales force, etc.

Secondly, it is necessary to define the goals and standards of the distribution system channel channel based on company’s standard procedures to achieve sales targets and development orientation of the company.

Thirdly, select the distributor’s strengths to meet general requirements that the company proposes, and determine if the distributors can develop or not, and identify the needs for manpower and material resources of the distributor.

Fourthly, build sales force at distributors’ side; assist them in pushing the products to the market

Fifthly, develop promotions, accumulated point programs, discounts, display support, POSM, etc. to promote the distributors.

Sixthly, assist the distributor with technology solution, control distributor’s performance, and regularly assess their performance after coming into operation.

3. Effective Management of Distribution System Channel:

Effectively manage the distribution channels of the company from traditional to modern ones, build and manage the sales team of the company as it is a very important force of the company to sell or distribute the products.

Distribution system management is also an integrated process from production to sales and distribution. Control the operation of distribution channels to ensure that the process that the company has set is correct. In current era of technology, the application of software to management in order to optimize and increase work efficiency is a trend that many enterprises are interested in. Applying technology to distribution channel management process makes management become easier and more efficient.

When applying the  distribution management system solution to administration, it helps enterprises have the optimal automation and workflows that save time and personnel resources for operation, and cover more customers instead of recruiting more people. Huge expenses in distribution for promotion, display, sales programs, POSM… are strictly controlled on the system to help businesses resolve negative issues, budget losses and ineffectiveness in deploying these programs.