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Ten Tips: Converting Promising Leads to New Partnerships

New Partnerships

By: Greg Seminara,Export Solutions
Topics: New Business

Have you ever experienced an incredible first meeting with a distributor ? Strong alignment , good fit, everyone smiling, timelines agreed. Then, nothing happens ! The export manager may take up to six months to translate his outlook from "done deal" to "dead deal".  There are two reasons why this occurs: First ,distributors are positive, competitive athletes, always striving to win new business. However, in some cases, the distributors wake up after time to reflect and decide they really weren't interested in your brand after all.  Failure also results when a strong first personal meeting at a trade show or distributors office is followed by a relationship buried in email communication, with no personal touch. Below are Export Solutions Ten Tips on converting promising new business leads into tangible business partnerships.

1.Call/Skype- Don't depend on Email
Motivated distributors still return phone calls, but frequently receive up to 200 emails a day, many from existing brand partners. Top distributors business days are captured by a continuous flow of meetings with customers,principals, and their own employees. Best bet is to call a potential partner or set up Skype meetings.
Email is okay for routine correspondence, but too easy to ignore or delete. 

2.Follow Up Immediately & Frequently
Time slips away, as Export Managers focus on existing businesses and "problems of the day".  One tip is to put regular follow up reminders on your computer calendar.

3. Focus on 5 C's: Category Review,Calculation, Cost of Plan,Compliance,Contract
There are 5 critical elements to translate a "lead" into shipments.

 Category Review:
How does your category look in target country ?
Category size, competition,pricing,margins, and merchandising activity. 

Calculation:
What is the distributors proposed calculation from your factory gate to the store shelf ? What are standard costs like duties and taxes ? What are flexible or negotiable like trade discounts and distributor margin ? 

Cost of Plan:
Each brand needs a plan to gain market entry. This includes key account "sell in", followed by consumer and trade promotion activities. Look at the distributors proposed plan, as well as several options with different price tags. 

Compliance
Many countries feature a product registration process and labeling requirements. In some countries, this step is easy with automatic compliance for a USA or European brand . Or a simple solution with a small distributor applied sticker. In other countries like Japan or Indonesia, plan on one year or more to navigate the complex process. 

Contract
Ready, Set, Go, can be delayed by 3-6 months due to contract negotiations. Company lawyers demand 20 page agreements in English that even the Brits can't understand. Distributors prefer two page letters of understanding or a handshake deal. Do what is right for your business, but expect delays and frustration.

4. Request References
A good idea is to quickly request Distributor references from other brands they handle. Motivated distributors will send impressive references right away. Also, have your credit department run a Dun and Bradstreet or Equifax report as soon as possible. Many trade show meetings are with "pretenders" who state exaggerated claims and are ultimately too small to handle your brand. Better to discover this sooner versus later.

5. Move Beyond the Distributor Owner/MD
The distributor owner "writes the checks", but frequently serves as a "bottleneck". The key is to quickly get your brand assigned to a "worker" whose task is to move your project through the system and produce an order ! 

6. Establish Realistic Timelines
Sync with category review dates and avoid holiday periods . Update timeline frequently. New Distributor relationships always take longer. Plan on six months from first meeting to first shipment. Be pleasantly surprised if things move quicker. 

7. Distributor Response Time Signals Interest Level
How often do you check your emails ? Probably every hour. When I work on distributor search projects for well known brands like Pringles, Tabasco, or Barilla, distributor response is lightening fast. Motivated distributors will chase you if tghey are interested,because they are anxious to start selling your brand ! 

8. Establish Regular Checkpoint Calls
I suggest every two weeks at a minimum. Use a common document of priorities, action steps, and due dates. 

9. Visit the Distributor
Its amazing the amount of progress that will be made during a meeting at the distributors office. Also, the distributor will work hard in advance of your visit as your project moves up the priority list and they want to guarantee a favorable impression. A visit to the distributors market signals your commitment. Beware if the distributor is reluctant to schedule your visit. Either he has changed his mind about a partnership or his office and capabilities do not match the bold promises made at the initial trade show meeting.

10. Parallel Path Two Candidates per Country
A favorable first meeting represents an excellent start. However, there are still many steps ( think 5 C's in point 3) before you sign a contract and receive your first order. Always keep two candidates in the process, in case your top choice disappoints. This can be tough, but represents a better option than needing to start the entire process over again.