To increase the number of sales of the product that you manufacture, you have to broaden its market coverage. To accomplish it, you have many options that you can choose from, such as expanding your firm to another area. However, although it is a good way to broaden your product’s market share, this option may come with risks and costs. Thus, in many situations, employing multiple market intermediaries, such as insurance agents, real estate agents, retailers, dealers, distributors, etc., can be more feasible than building another store branch. In doing so, you will need a distributor letter of appointment. We’ll discuss more of it in this article. Additionally, we have included a set of sample appointment letters that you can use to send to your authorized resellers.
Benefits of Using Distributors
Depending on the result of your market analysis, including distributors in the distribution strategy, will allow your company to enjoy its beneficial results. Let’s discuss more of these advantages below.
1. Acquiring an Established Customer Base
In expanding a market share, you will have to infiltrate a new market, which can be quite risky. However, by offering local distributors with existing patrons, you can eliminate this risk. You don’t have to start from scratch in building a strong relationship with your customers.
2. Sales and Marketing Edge
Aside from the established customer base, local distributors may already have strong sales and marketing skills, which will cut down the need for your effort to build these skills in the area. You should be glad not to deal with these areas because, according to the marketing statistics of Hubspot, snap ads alone will cost you at least $3,000 per month. However, to ensure that you can take advantage of this benefit, you have to research the potential distributor. It will also help if you will ask the firm to submit a business proposal to get a better understanding of its background and capabilities.
3. Logistics and Storage
Logistics and storage are a few of the essential but hassle parts of doing business. If you open a new store branch to sell your products yourself, you are going to need an adequate amount of space to store your products. You will also need to deal with the logistics to deliver your items to the customers. However, you don’t have to worry about these inconveniences if you will give permission or authorization for the resellers to sell these items.
What is a Distributor Letter of Appointment
A distribution letter of appointment is a type of letter that manufacturers use to announce their approval for a particular distributor to resell the products they produce. Although you have the option to create another document for the distributor agreement, a typical distributor appointment letter may already serve as your agreement.
8+ Distributor Letter of Appointment Samples in PDF | DOC
By now, you have a better understanding of the use of a distributor letter of appointment. In this section, we gathered distributor appointment letters, which you can download in MS Word(.doc) and PDF(.pdf) file formats.
1. Distributor Letter of Appointment Sample
2. Distributor Letter of Appointment Template
3. Distributor Letter of Appointment in PDF
4. Distributor Letter of Appointment Example
5. Basic Distributor Letter of Appointment Sample
6. Distributor Letter of Appointment Agreement Letter
7. Distributor Referral Appointment Letter Sample
8. Formal Distributor Letter of Appointment Template
9. Distributor Letter of Appointment in DOC
Tips in Looking for a Distributor
Now you have obtained an appointment letter that you can use for closing a distributorship deal. In this section, you will learn how to make a productive dealership agreement by looking for the best one.
1. Understand Your Product’s Industry Distribution Channel
The distribution method that you have to use may vary to which industry your products belong to. For example, you are producing products under FMCG or fast-moving consumer goods. Most likely, you will use several market intermediaries, such as wholesalers and retailers, to maximize its number of sales. You can also read our article about distribution channel management to know more about this process.
2. Make Sure that Your Products are Market-Ready
Before you sell your products to the market, make sure that these goods are marketable. Meaning, your products should appeal to the customers. Use a good packaging and, if possible, set training with a meeting agenda to make them aware of the benefits of consuming your products. You can also include the proper way of storing your products to ensure that these will reach the customers in perfect condition.
3. Make Your Products In-Demand
Nobody wants to sell products that don’t sell. Making your target market to want your products is not the job of the distributors. It is your task. You can try to offer a free taste to the customers in a grocery store or wherever you think your target market is. To do it, you will want to create a marketing campaign.
4. Try Online Marketing
You should know that online marketing has already become a popular method of retail marketing. It is due to the rising number of people to go online. According to a July 25, 2019 Statista article, the number of people using the internet has reached more or less 3.9 billion. Level up your marketing strategy by penetrating this type of marketing.
Including distributors in your product distribution process is indeed an essential way to make your business prosper, and by using a distributor letter of appointment, you can optimize the number of distributors that you will include in your distribution plan. However, as we have mentioned earlier, the right distribution channel to apply in your business may vary to the result of your market research. Particular items will sell more with direct selling. Thus, it is crucial to include this study in your distribution plan.
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