Sales Network Construction



1. Sell Through Distribustors
Sell through distributors is the easiest and fastest way to penetrate
the market. It does not require the need for a local office, only a dedicated
commercial forces to start selling. Our team is determine to target the
right distributors and create channel with the dealers at your place.

Advantage : Very low initial cost. No human resources needed.
No accounting, SI or network synchronization needed.
Quick and easy to organize.

Limits : Your products or services must fulfil the local demand or
have a strong comparative advantage (price, quality, technology...).

 

2. The Representation Office System

Setting up a representation office in the local country is a big step in your
investment plan. It represents a real determination in setting up the business
and commitment to expanding your sales.
As the first system, the distributors commit to their mission, engage in wholesale
purchasing and sell to the dealers within their network. The representation office
has the mission to build the brand name and increasing product popularity for
both resellers and end users. And finally, with their local presence, the system will
work as a support for headquarters in developing corporate programs and CRM.

Advantage : Local presence, local sales and marketing team.
Minimize channel conflict. Open to corporate and public projects.
Take care of the clients services, building brand name.

Limits : The representation office does not sell or trade anything so its operating
budget depends on the headquarter contribution.
Warning : Setting up a representation office MUST be fully accounted for in your
strategic plan, and you must be ready to invest money for at least one consequtive
year before receiving significant results.

3. Branch Office System
  The Branch Office works as a client of the mother company.
it buy goods and sells them directly to the distributors and/or the resellers.
It's mission is to represent the company in a different geographical area
and to open the business to more people (corporate and end users).
The Branch Office, as a commercial company (100% owned/fusion/
acquisition or joint venture) aims to make money and run independently.

Advantage : Gain access to a different geographical market when physical
presence is necessary or recommended to conduct business.
Meet clients' needs, and dynamically respond to their request.
Make your company more attractive, and consistent since building a
Branch Office requires significant amounts of ressources.

Limits : Building a Branch Office is a very heavy operation that need to be
fully approved in your strategic plan. It is more complex to build than a
Representation Office because it requires warehousing, alogistic specialist,
and much more cash flow. It requires additional admisnistrative work,
management, detailed budgeting and accounting synchonization with the
mother company, especially if it is necessary to record for statistical purposes.
The firm which attempts to set up a Branch Office must be adequately capitalized
in order to support the office for a considerable lenght of time before it could
generate its own revenue.


4. Branch Office (Direct Sales)

  Direct sales is an alternative system, easy to setup and recommended
for companies that want to deal with the margins of distributors and dealers.
The Branch Office in this situation has two main missions :
- make sure their products and internet web sites are familiar with the public
- organize a logictic and tracking system for the orders

Advantage : Direct sales is a cost effective solution. No sales and no
distribution network needed. It is quick and easy to set up because it allows
your company to control 100% of your margin.

Limits : Online selling is risky for young and inexperiented companies.
Customers that like to "test drive" products and services are unable to do so
and must make the decision to thrust the company. In this case, marketing
is the key to success, and it takes strategic timing and money.


5. Branch Office (Direct Sales + Sales Through Distributors)

This distribution network construction deals with both distributors and
direct sales. The system is fairly attractive, with wholesale business on one side,
and direct sales and optimizing the profit margin on the other. However, this system
has its limits. It is only recommended large and mature companies.

Advantage : Participate in both volume and margin optimization.

Limits : Can generate channel conflicts. Need to set up order platform,
logistic and CRM as well as simultaneously manage the distribution channel .