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2018 Focus: Underperforming Markets

By: Greg Seminara, Export Solutions
Topics: China Venezuela Brasil Russia

All Companies Have Problem Markets!
The first step is to admit that the market has a problem. It’s a natural instinct to rationalize poor results and hope for future improvements. We must remind ourselves that chronic underperformers impact our ability to achieve our personal sales and profit targets.

Four Warning Signs
1. Low development for your brand relative to adjacent countries and size of category

2. Large country- small shipments

3. Current distributor is too small ( or too large) to meet your requirements

4. Distributor failure to reinvest in the business: People, Training, Technology

Segment Existing Markets According to Results
Markets can be labeled “Leaders”, “Achievers”, and “Laggards”. Normally, 20 % of the markets should be categorized as “Leaders”, 60 % as “Achievers” , and 20 % as “Laggards”. Take lessons learned from your “Leaders” and apply them to other markets

Turnaround Strategies
Focus on the Fundamentals-Evaluate core elements of your brand and their relevance vs. other brand alternatives. Adjust pricing, promotion, packaging strategies, if required.

People with Passion- The right person managing your business can make a significant difference. Insure that the person assigned to your brand can influence the organization to achieve your goals and has sufficient time to dedicate to your business.

Distributor Change-Organization change is a last resort, but sometimes the best avenue to reinvigorate your brand. A new distributor brings energy, focus, and commitment. A former boss would terminate one distributor per year to send a message to other distributors that the company would not tolerate sub-par performance.

Pay for Performance- Sales people everywhere respond to incentives and sales contests.
Incentives could range for a corporate bonus to a distributor who achieves a 10 % shipment increase to “ipods” or other merchandise to all sales people who hit their “stretch objectives”.  Strive to offer programs where “Everyone can win”.

Increase Visibility- Increase the frequency of your market visits to problem markets. Invite the distributor to your corporate office for a meeting with top management and a factory tour. These “bonding” activities will improve communication and commitment.