Mastering Distributor Partnerships for Growth: Part 1 - Planning and Plan Management
Healthy and productive distribution relationships are crucial for any brand to build sustainable success, yet so many seem to break down relatively quickly despite the best of intentions. One of the most effective ways to ensure that this breakdown doesn't occur, and to empower sustainable and productive relationships, is through planning and plan management. To create the necessary foundation for a healthy relationship with distribution partners, a brand must first define what success looks like and the steps required to achieve it. This means effective brand planning. With Annual Business Planning (ABP) season quickly approaching, now is the perfect time to build a strategic plan and communicate it with your distribution partners.
The Importance of Proactive Planning
Your distributors should be collaborative partners in building and scaling your brand, but the initial responsibility lies with you. Distributors have numerous brands to support and will dedicate their time and resources to those with clear, strategic plans. Look at things from a distributor's perspective - their number one priority is to grow their overall business and sales volume. From first-hand experience, I can tell you that distributors commit the most time, effort, and resources to the brands that give them the best chance at achieving this growth through effective planning.
A brand that presents a clear and effective plan engages a distribution partner because this plan is a roadmap for the distribution partner to drive sales and create growth. Conversely, a brand that does not present a plan, or presents a convoluted plan that puts all of the burden on the distributor to generate results, will create frustration and disengagement. During the craft beer boom, many brands failed to provide effective plans, leading to disappointment and misunderstandings.
Three Foundational Elements for Effective Brand Planning:
Establishing Annual Volume Goals: Set yearly volume goals, broken down by individual product and packages. These goals should be ambitious yet realistic, reflecting market demands and production capabilities. Clear, measurable goals help track progress and motivate the sales force, providing a roadmap for the year.
Pricing Strategies: Determine competitive pricing for each SKU, ensuring market competitiveness while maintaining profitability. Analyze market conditions and competitor pricing to set effective prices. Effective pricing strategies should find the best possible balance between profitability and market engagement, taking into account feedback from distribution partners.
Regular Check-Ins: Conduct monthly calls and quarterly reviews to monitor progress throughout the year. Adjust strategies based on market feedback and performance to continuously improve the brand’s performance. Regular check-ins ensure the plan remains relevant and responsive to changing market conditions, providing opportunities to address issues and celebrate successes.
The Role of ABP Meetings
With ABP season approaching, it's the perfect time to build and implement effective and engaging brand plans with your distributors. It’s crucial to engage with your distributors effectively and allow your brand to stand out in a crowded portfolio. The ABP meeting is not just a formality; it’s a strategic session where you and your distribution partners can set tangible goals, implement plans to achieve those goals, and discuss potential challenges, opportunities, and market trends. By aligning on a shared vision and specific goals, you can build a stronger, more cohesive approach to success in each market. Without effective planning, a distributor will feel increasingly powerless and frustrated. Especially in today’s market, a distributor needs to feel empowered to engage and execute your brand’s potential.
Learning from Experience
Having run a distributor for almost a decade, I can attest that brands with strong plans in place often outperformed those with more resources but less effective planning. Here’s a common scenario: You sign with a distribution partner, launch the brand, and see a great initial sales bump. However, this initial success can lead to complacency. The brand assumes that it's only up from here and leaves the distributor to make it happen. Almost any brand will see an initial sales bump when launching in a new market due to the novelty factor. The real challenge is earning the follow-up sale and building a foundation for scalable growth.
Brand planning with distribution partners and managing those plans are essential strategies for boosting results and establishing effective distribution relationships. With ABP season approaching, it's vital to perform an honest self-assessment to put your brand in a position to create and build successful partnerships moving forward.
Do you want to ensure your brand is set up for effective distributor relationships and sustainable growth heading into 2025? Click the link below to schedule a FREE STRATEGY CALL where we will perform a comprehensive analysis to put your brand on the path to success.
