6 Ways Not to Get Dropped by Your Distributor Partner

Last week I was in Maui with clients. Today I am in Minneapolis St. Paul with clients. Two very different cities for sure on all fronts. Different weather, different people, and different topography. While these cities are very different, my clients that are the liquor brands from these cities have the same problem, the distributor partner gave up on them. Similar to my first marriage, the relationship ended for no real reason that I saw. One day we are all getting along, singing in the park, rainbows and unicorns and then it ended.

Now, selling brands and being married are not the same at all, but a relationship is a relationship.

When distributors end their love of your brand, the only ‘dear John’ note you get is lower sales and declining depletions.

Why would a distributor drop you? Well there are many reasons and some you likely know and some you do not.

Here are just a few:

• Lack of Sales
  Obviously if you don’t sell for them they will not sell for you
• Losing a key member of your team.
  Not known as much, but if the distributor has a sales person or brand lead from your team that leaves, gets poached or is fired, the distributor my enact the with cause kicker in your distributor agreement – they work with who they like.
• A stronger like and kind brand
  Sometimes when two strong distributors in the same market have similar style brands, it can become a ground war. If the distributor does not feel the war can be won, they will pull resources off that brand. This is very common in the over saturated vodka and brown spirits wars that are happening now.
• Investable dollars
  More dirty secrets. Sales incentive programs are often co-op’d dollars with the distributor partner. If you cannot contribute, than neither will they. The more dollars you can throw towards sales teams, the more dollars they will coop and theoretically, the more sales you will have.
• Feet on the ground
  This is a big one, and I feel very strongly about this. If you are willing to put boots on the ground the more likely that your distributor will be successful with your brand. Any added assistance you can give as brand owners will let the distributor know that you are ‘for real’ and that you are worth supporting.
• The uncontrollable reality of supplier targets that are not your brand.
  Many big distributors that distribute large brands have built in sales targets for said brands. If you are not that large brand, and it is O-N-D, and the distributor is falling short of other brands targets, watch out! You will be sent to the sidelines so they can sell other brands. Often times, large brands hit distributors with financial penalties if targets are not met. That said, plan on supporting your own brand as Q4 comes into play.

So look, distributors will drop brands all the time. Brands will get dropped without cause and often for some bull malarkey reason that you never saw coming. We all know the pain of the distributor hunt and how it stinks. Solving that will be the difference between a brand and a hobby.

• Pick the right distributor partner
• Help sell your brand socially
• Know what the other distributor in market carries that is similar and watch those sales trends
• Bookmark money to support the sales teams
• Put a crew on the ground because as I always say, “distributors will not build your brand”
• Make it a point to know what your distributor also carries that has sales targets that could impact your brand success.

If you are mindful of these items and keep open communication with your distributor partner you will be fine, especially as. O-N-D comes and goes. You do not want to get dumped by your partner with a surprise certified letter delivered to your door in a very unceremonious fashion.

Just saying…