When we talk about ‘Distribution‘ in your business, we are talking about your ‘Channels to Market’ – where do your clients come from. Our experience has demonstrated that the best clients come from referral relationships – but keep reading before you leap out of your chair to attend another networking event.
Your business will benefit most if you have a small, committed number of strategic referral sources. So another way we use ‘Distribution’ is to mean the deep, business to business relationships you have developed that actively send you work. This isn’t coffee-and-a-handshake conversations.
In my last article I talked about businessmen seeking a magic bullet to their revenue fluctuations, ultimately discovering that an ongoing Relationship System was key, but then diving into “Networking” and being disappointed with the results. Today I want to talk about an alternative solution my team has developed over the past 15 years.
Your Distribution Supermarket
One way of thinking about Distribution is comparing the Kellogg’s – Woolworths example. Kellogg’s don’t directly sell their Cornflakes to customers – you can’t buy them from the Kellogg’s website, and they won’t ‘cold call’ you at breakfast time to see if you’ll make an impulse purchase.
Instead, Kellogg’s use Distribution channels – including your local Coles or Woolworths. Kellogg’s builds their primary relationship with the Supermarket; the Supermarket has the end Customers; and while Kellogg’s does have a relationship with their clients, the Distribution is the source of their business.
Kellogg’s have a relationship with both the supermarket and the customer. But the customer comes through the supermarket.
Referral relationships in any business follow the same pattern. While you may have the option to sell direct to your customers, you also have the option to find Distribution sources – your supermarkets, those business relationships with agreements for them to provide you with multiple pre-qualified, pre-sold clients.
Clients provided through Distribution relationships:
- Are easier and faster to convert in the sales process
- Are generally more profitable, and more loyal
- Are a continuous stream of leads for your business, able to be dipped into whenever your business may require new clients
Networking activity can be the perfect starting point for finding Distribution relationships. But be warned – it is very easy to find yourself investing in networking groups because you like the conversation or the breakfast provided, not because you are actually receiving quality leads. And even if you do meet the right referral sources at a networking event, there is much that needs to be done to build the relationship in a more direct manner.
After all, the CEOs of Kellogg’s and Woolworths didn’t meet for one coffee, shake hands, and agree to send each other customers – they invested in the relationship and came to an agreement that benefited both parties.
Actions
- Do you currently have a small number of deep relationships sending you regular pre-qualified, pre-sold clients?
- If not, are you investing in networking breakfasts or are you actively building a Relationship System in your Business?
- For more information, contact me for a complimentary copy of our “Introduction to Distribution” document detailing the key steps you must undertake to develop this system for yourself
Jacob is an energetic business coach, speaker and author. He works with young businesses wanting to grow faster by leveraging the experience of others.
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