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How can Smaller Distributors Compete with Bigger Companies?

blogWith big distributors taking on the role of retailers and retailers becoming distributors, there is a growing trend of reducing third parties. B2B models now range from individual company operated procurement solutions to large marketplaces. So, how does a small distributor survive and succeed in this market space?
The answer lies in redefining distribution to create an enhanced vital role.

Typically a small distributor caters to a market with many small customers. These days, with online sales and better logistics, bigger companies are able to efficiently reach customers, regardless of order size. However, in B2B purchasing, instances where customers buy products without really researching them are rare. This is where the distributor can still leverage their strengths to stay in the chain – in roles where the level of customer educational service required is high.

In today’s digital world, where nearly 90% of B2B customers use the Internet to research prior to buying, small distributors have to leverage their web presence to establish competency online.

How do you share your capabilities online?

  • Online Presence
    Create a website that is easy to navigate. B2B customers require information. Decisions to buy are based on references – both offline and online.
  • Register with Trade Associations
    Make it easy for customers to find you. Cross-link between your business website and other forums. Join online industry forums to read up and answer queries that you have the knowledge to answer. Always link back to your website.
  • Specialize
    Be industry and location specific. The Internet floods customers with choices. Nevertheless, there are customers looking for vendors of specific products or in specific areas. By capturing a niche market you can draw, create, and build a loyal customer base.
  • Maintain Stock Levels
    One of the primary requirements from a distributor is immediate supply. Otherwise, customers would directly get in touch with the manufacturer. Reflect current stock levels online and strive to maintain adequate stocks to earn customers trust and prove they can get what they need from you.
  • Online References
    Feedback from happy customers is a great motivator for further sales. Genuine positive references from others like industry experts bring in more trust.
  • Be Knowledgeable
    Stay up-to-date on the products in your industry. Be the thought leader that customers and suppliers look to for information on industry trends.
  • Be Professional
    Clearly state commissions payable, whether you will deal with competing products, and legal requirements.
  • Care
    Be a key facilitator in improving business for suppliers and vendors. Research shows that emotional decision making plays a larger role than rational decision making.

Distributors still play a vital role in the marketing process. It’s up to you to evolve businesses and remain irreplaceable.

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