The people on the local level your distribution channel are more important than you realize.
Too many building materials manufacturers treat local dealers and distributors like they’re glorified warehouses – just a place to park their product until the end user comes asking for it.
They ask for a lot, want lower prices, take up your time and maybe you think they get paid more than they are worth.
Manufacturers can also mistakenly see contractors as more of a necessary evil than a strong advocate for your product.
If you’re in this camp, you are missing out on a number of sales opportunities. You may also be unnecessarily swimming upstream against these powerful local influencers.
Let me tell you a couple of stories to show you what I mean.
Advertising to the Wrong People
About 30 years ago, I worked with a large shingles manufacturer that was struggling to grow its sales in one region. No matter what they did, their sales just kept declining.
The first thing they tried was going to their ad agency. And of course, the ad agency suggested a major ad campaign. So, they spent a lot of money running television ads aimed at homeowners. After 90 days of trying to convince homeowners to buy their shingles, sales still hadn’t improved.
So, they figured that maybe no one’s buying them because the price is too high. So, they slashed it. They made their price so low, it was cheaper than the ones offered by their competitors. Now that they were offering a high-quality product at a low-budget price, it should’ve been flying off the shelf. But after several months at the lower price, nothing. Not only did their sales not improve, they continued to decline.
That’s when they came to me. They hired me as a consultant to figure out just what was going on and how they could fix this problem.
To figure out why their sales were declining in that region, I traveled to it and rode along with some of their salespeople.
Once we were there, I interviewed the customers and found out that they had no problems on this front. Homeowners loved the product and loved the brand.
So, I thought maybe it was the distributors who were keeping this product from selling. But when I spoke to them, they all told me they preferred dealing with this manufacturer because they’re easier to work with than the others.
Homeowners loved them. Distributors loved them. But I found one group who didn’t care for them at all: roofing contractors. The local roofing contractors had used a similar shingle in the past and ran into some problems with it. There was no way they would go back to using a product like that.
And that had a kind of trickle-down effect. The distributors and dealers (who loved the company, remember) wouldn’t carry their product because the contractors weren’t buying it.
And the homeowners who were intrigued by those expensive TV commercials would bring it up to their contractors, only to have the contractor tell them that the shingles my client was selling would be too much trouble.
And that was the source of the problem. They put all that energy into convincing homeowners to buy their shingles when it’s the contractors who really needed to be convinced.
Sometimes, you can go around the contractor. If they’re indifferent about what kind of vinyl siding to stick on the side of a house, then all you have to do is convince the homeowner to ask for your brand and the contractor will oblige. But in many cases, they’re the gatekeepers. They’re the ones who will decide whether the products get used or not because the homeowner will trust the contractor if the contractor has a strong opinion about your product.
New home builders, architects and facilities managers will frequently trust the contractor’s advice more than the manufacturers.
My client underestimated the importance of the contractor and ended up paying the price for it.
Once they aimed their efforts at the contractor and showed them how the previous problems had been fixed, their sales took off.
They didn’t have to convince the homeowner, the contractor did it for them.
Relying on Local Suppliers
In another instance, I was working for a high-end window manufacturer who was looking to increase their sales.
I met with an architect and a dealer for these windows who were going over the plans for a 15-million-dollar house and it came time to decide what kind of windows to use.
What I saw next kind of floored me.
The architect told the dealer they would leave the decision entirely up to them. The architect reasoned that they didn’t know as much about windows as the dealer to make the call, and instead of doing all the research needed, it made more sense to pass it off to the dealer, who already knew more about windows.
With that little bit of delegation, my client’s fate was entirely in the hands of the local dealer, not the architect.
I traveled to six different cities and saw the same thing over and over again. Even when architects had some opinions, they still depended on the window dealer to help them make the right choice.
These dealers all carried windows from several different manufacturers to meet the needs of different projects.
And this was the heart of the problem. My client saw the local dealer as just a middleman, as someone who facilitates the deal but has no real influence. Little did they know, they weren’t just influencing the product decisions –in some cases, they were picking the products themselves!
Respect the Power of Local Decisions
If there’s one big lesson here, it’s this: don’t underestimate the importance of how decisions are made on a local level.
Local dealers, distributors, and contractors are trusted by their customers and often have a lot of sway over their product decisions.
The mistake a lot of building material suppliers make is assuming that the ones with the decision-making authority will be the ones making the decision. Yes, the choice of what product to use will be in the hands of the architect, builder or the homeowner, but they will often delegate that decision to their local supplier or be swayed by their opinions.
Many building material companies also underestimate how savvy these dealers are. They know more about selling building material products than you probably give them credit for.
In fact, they often seem to know more about it than the manufacturers themselves. They’ll receive displays, samples, brochures and other sales tools from the manufacturer and they’ll be able to tell right away which ones will work and which ones were put together by a creative designer working in a vacuum without any clue how to sell your product.
Local suppliers also often act as advisors. The good ones have an impressive amount of knowledge and they will sit down with their customers to figure out which product they need. They can steer the builder, the architect, the designer or the homeowner in the direction they feel is best. And if you haven’t done enough to show your local supplier why your product is a great option, then they’ll probably steer a lot of potential buyers away from it.
They also know which companies offer the best support and which ones are going to make them jump through hoops for every little thing they need. When something got damaged and needs to be replaced, they know which companies will keep them hanging and which ones will respond right away.
More than Just a Funnel
It’s important to recognize the power and influence of the local supplier. They’re not just a funnel that you throw your product into and then it gets distributed to the customers who come asking for it. They play an important role in deciding which products the customer will use.
If you take advantage of this and work more closely with your local suppliers and offer them the support they need, you will see your sales go up more quickly and at a lower cost-per-sale than you would if you just tried to get around them.
It’s also easy to stand apart from the competition because not many of your competitors are taking their local suppliers as seriously as they should.
If you see your local suppliers as a necessary evil in the distribution channel, you need to reframe your thinking. Think of them as sales partners instead. Because they will help you sell your product – as long as you give them the support they need to do it.
If you like to see how a local dealer can be your best salesperson, talk to Devon Tilley at Mountain View Window and Door. I would not want to be selling against him.
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