Distribution Opportunities in India

Customer is oxygen for business. More customer means higher sales and thus better financial health. To remain in business - manufacturers have no option but to seek out more customers in larger markets. Effective distribution strategy enables a business to achieve this goal without significant investment in sales infrastructure. So, how should a business go about building distribution channel ? The first task is to create a distribution plan charting a path for accessing market. Ideally, businesses should consult experienced distribution trade professionals to prepare customized distribution plan matching their products. Failure to do so may lead to loss of money and wastage of resources or in worse case - loss of brand image and reputation.  This article outlines essential parts of a distribution plan. In case you need a customized distribution plan prepared by experienced distribution trade professionals - please tell us here . 1. Analysis Of End-User Foundation of a dis...

We all know distributors help manufacturers by re-selling products. But there are many other ways a distributor adds values in manufacturing process that need to be understood. Its true, distribution channel costs money - sometimes as high as 40% to 50% of MRP. But a properly aligned distribution  channel also adds enormous value through tangible and intangible ways. Knowing these facts can help manufacturers make optimum use of their distribution channels. This article describes some known and some not-so-known facts about how distribution channel adds value in manufacturing. 1.  Bulk Breaking Companies produce in lots, but consumers buy in single piece. So, we have retailers who buy in moderate quantity and sell in single units. However, the nature of manufacturing is such that, its     completely uneconomic for even a small or medium sized company to sell to retailers. Distributors break manufacturing  lot into pieces or dozens or whatever units the...

In every country or market - whether developed, emerging or underdeveloped - consumer products eventually go through some form of distribution process. The distribution chain involves movement of goods from factory gate or shipping yard to consumers' doorstep. Success in international market largely depends on entering the distribution chain with suitable overseas partner who can successfully introduce your products. There are several models and resources - one can select depending on own organizational resource. 1. Wholesale Model Wholesaling involves selling in bulk to an overseas wholesale partner who has access to downstream channel for re-selling the goods. The wholesaler buys in bulk from Indian seller and takes complete responsibility of selling the goods in his/her own country. Post sell, the Indian seller is free of anxiety, but loses track of how his/her products doing, such as - at what price the consumer is buying, margin of intermediates, consumer feedback etc.  ...

Distribution is the backbone of Indian market - feeding its massive retail system spanning across length and breadth of the country. Estimated to be $ 714 billion (2019) -   Indian retail market is expected to grow at 10% CAGR to reach US$ 1.2 trillion by 2025. Unlike developed markets, over 70% of Indian b2b distribution market is in unorganized sector, having its own dynamics peculiar to Indian social and cultural ethos. Understanding this market, its players, their respective roles and overall market dynamics is vital for success of any brand.  Indian Distribution Model A specific feature of Indian distribution model is presence of many intermediaries - almost too many in certain cases. A study by McKinsey and CII (Faida Study in 1995) found presence of 7 to 11 intermediaries in agro distribution channels.   These intermediaries bring costs and benefits in varying degrees. The wholesaler model, for instance—in which large, powerful wholesalers buy produc...