When manufacturers are ready to bring their products to market, they often face a critical choice: should they sell directly to retailers or go through a distributor? Both strategies have their advantages, but selling direct to retail can open new opportunities for control, profit, and customer relationships that can drive long-term success.
Why Sell Direct to Retail?
- More Control Over Branding and Pricing: Selling directly to retailers puts manufacturers in the driver’s seat when it comes to how their products are presented and priced. Without a middleman, there’s no need to compromise on brand image or give up control over pricing policies. This means your products can consistently appear the way you want them to in the marketplace, protecting your brand’s reputation.
- Better Profit Margins: By skipping the distributor, manufacturers retain a larger portion of each sale. Without the distributor’s cut, you keep more of the revenue, which can be reinvested into growing your business or enhancing your product offering.
- Closer Relationships with Retailers: Direct sales foster a closer connection with retailers, which can lead to better communication and stronger partnerships. Manufacturers can gain more insight into how their products are performing on the ground and receive direct feedback that can shape future product developments.
- Faster Market Response: With fewer layers in the process, manufacturers can respond more quickly to changing market demands and trends. This can mean adjusting pricing, launching new product lines, or responding to customer feedback faster than if a distributor were involved.
- Streamlined Communication: By dealing directly with retailers, manufacturers eliminate the possibility of miscommunication that can occur when relying on a third party. This can make it easier to address issues, ensure orders are fulfilled correctly, and foster more effective problem-solving.
The Case for Using Distributors
While there are clear benefits to selling direct to retail, distributors still have an important role, especially when manufacturers are looking to expand into new markets or streamline their operations.
- Access to Wider Markets: Distributors can open doors to retailers in new regions thanks to their established networks and relationships. They often have a deep understanding of local markets, which can help manufacturers overcome barriers like language, cultural differences, and regulations.
- Less Operational Burden: By handing over logistics, inventory management, and order fulfillment to a distributor, manufacturers can focus on what they do best: creating great products. Distributors manage much of the operational side of sales, freeing up valuable time and resources.
- Established Relationships; Distributors often have long-standing connections with retailers, which can help manufacturers get their foot in the door with key partners. This can be a faster route to gaining retail shelf space, especially in competitive markets.
How ‘Best of Modern’ Can Help
Choosing between selling direct to retail and using a distributor is not always straightforward, and the right answer can vary depending on the market, product, and your long-term goals. That’s where Best of Modern comes in.
With over 10 years of experience in the global market, Best of Modern specializes in helping manufacturers make informed decisions that align with their specific needs. Here’s how we can support you when we’re working as your sales agency:
- Tailored Market Analysis: We provide insights into market conditions and consumer behavior in different regions, helping manufacturers determine which strategy—direct or via distributor—works best in each country.
- Local Expertise: Each market has its own set of challenges and regulations. Whether you’re entering North America, Europe, or anywhere else, we help you navigate those complexities with confidence.
- End-to-End Support: From initial strategy to execution, we’ll be there every step of the way, helping you implement the approach that makes the most sense for your business, whether that’s working with distributors or building direct relationships with retailers.
Selling directly to retailers provides the advantage of control, profit, and closer connections. But every market is different, and sometimes working with a distributor may still be the best route. At Best of Modern, we help you make the right choice for each situation and ensure your business thrives globally.