FINDING GLOBAL SALES PARTNER REQUIRES GLOBAL THINKING
FINDING GLOBAL SALES PARTNER REQUIRES GLOBAL THINKING
According to leading economic indicators, the result has been record trade deficits of nearly $900 billion. By circling the corporate wagons rather than bravely moving into new territories, U.S. businesses have sent clear signals to these major competitors that we aren't interested in selling to 95 percent of the world's population. Granted, sales in most of these areas are only now showing strong promise but the potential is enormous.
As important to a firm's long-term global success in its respective market area is that by retreating from markets outside the U.S., the companies also abandon vital intelligence outposts. Outposts that can keep firms abreast of plans and actions of foreign competitors as well as provide solid inputs for next generation products and solutions.
As foreign firms become more aggressive in the U.S. market as well as on a global scale, many American companies are struggling to determine how they can increase their global activity and presence. Simply having a good global Web site isn’t enough. Firms usually have three choices:
* establish their own corporate presence in key countries
* acquire a small local competitor
* establish a relationship with a local, established distributor
For years, we watched European and Asian manufacturers fail in the U.S. market because they opened their own offices, sent in their own people and launched programs and activities that worked at home. Rather than being deluged with sales, they were overwhelmed with disappointment.
As a result, international distribution often appears to be an easy way to increase sales, but more is involved than simply signing up a distributor in each target country. Those firms that have attempted to impose U.S. policies, programs and activities have found that rather than providing a blueprint for success, they became a roadmap to disaster.
Although it's almost unheard of for their U.S. counterparts, international distributors develop and carry out their own marketing and promotional plans and programs. In most instances they take almost total ownership of the products and their success in their respective countries...including sales, support and service.
Because the distributors are so important, U.S. firms that establish a relationship with them must view it as more than simply signing on a distributor; it's a strategic alliance. Too many firms fail internationally because they fail to fully come to grips with this important distinction, its requirements and its ramifications.
U.S. firms often lack a clear, concise set of international objectives. They often haven't determined which products/services have international appeal and haven't considered the training and support that will be required. In addition, they haven't set down the physical and fiscal commitments they will have to make to ensure the program's success.
Equally important for the company is the development of a strong profile of the ideal distributor or partner they want/need...even for domestic markets. Overseas, the selection process becomes even more difficult. The biggest distributor in a given market isn't necessarily the best organization to represent their products.
Since you are establishing a strategic alliance it is extremely important to ensure that management styles can co-exist and thrive together and that sound personal relationships can be developed.
In making the choice, it is important to understand how distributors operate in different parts of the world. In Europe, distribution varies dramatically from country to country, region to region, and often from city to city. The same is true in the Pacific Basin, South America, and the Middle East except in these areas the distributors are often national in nature. While numerous distribution organizations have expanded their global reach, their "image," influence and penetration can quite different from country to country.
In most of these international markets, distributors not only play a key role in the sale and distribution of goods, they are also a strong marketing and support factor.
They stock inventory. They have extensive lists of important contacts at the governmental and sales level as well as in-depth knowledge of their target markets. At
the same time, they spend considerable time and money developing and maintaining their technical, training, and support expertise.
Even as the Internet eliminates country borders to produce a global economy and global marketplace, too many U.S. manufacturers fail in overseas markets. They never fully come to grips with each area's important distinctions, their requirements, and the ramifications of these differences on how it affects the image, sale and use of their products. Instead, they rush to sign up distributors, fire them, and then sign up new distributors, much as they would in their own backyard.
This trial-and-error process delays sales success and in some instances has caused marketing and financial disasters.
On the other hand, firms that carry out a careful selection process, conduct positive support and training programs, continually monitor their foreign relationships are likely to increase sales and profits.
There are several other reasons for choosing international distributors with care.
Because of the distances involved in these strategic alliances as well as the language and customs barriers, U.S. producers, by necessity, relinquish a part of their marketing
and sales authority to the local distributor. Thus, it is important to ensure that their respective management styles can exist and thrive together.
It is also advisable to document a potential local country's partner's market connections. As aggressive as the global market is today, a company simply can't afford the luxury of establishing a relationship with a firm that doesn't understand its target markets or doesn't have strong relationships in those markets. Management has to keep in mid that one of the key things they are "buying" is the distributor's ability to quickly and economically tap into their markets...with your products.
In most areas of the globe being "the new aggressive, hungry kid" on the block is less desirable. Usually you're looking for established (dare we say entrenched) organization that has extensive, long-term relationships with senior management and key technical personnel at prospective customer organizations. Key personnel in most countries make less than their U.S. counterparts but they have often come up through the ranks and move less frequently from company to company.
Finally, because of the distance between a U.S. company's headquarters and an overseas distributor's territory, it is important to ensure that the distributor's sales force has solid technical expertise, as well as the ability to service customers. With the slim margins firms are forced to deal with today, it is seldom economically feasible to fly service personnel across the country, let alone across the ocean to handle customer problems.
When the supplier doesn't or can't respond to the overseas customer's or distributor's requests, the relationship sours quickly. This is especially true when the company is focusing all of their resources on protecting their market position at home rather than trying to build marketshare in the new territories.
Whether corporate management likes it or not, the local firm will be the company in that country. As we are all coming to realize service and support are becoming increasingly important for future sales. They become pivotal decision factors on the long-term success of a company and its products.
If the company isn't willing to commit the time, money and effort required in helping the individual country distributors become successful for your products and services, management will be wiser to forget about looking at the greener pastures on the other side of the fence and focus on staying in their own back yard.
It's better to be considered fairly good at home rather than a fool on a global scale.
# # #
FINDING GLOBAL SALES PARTNER REQUIRES GLOBAL THINKING - To learn more about this author, visit Andy Marken's Website.
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For a number of reasons, including the fact that the U.S. represents one of the largest and most lucrative markets on the globe, foreign firms have always been more aggressive in their efforts to gain a foothold here first and then expand their activities to other countries. American companies on the other hand have often taken a defensive posture and retreated from activities outside the U.S.
According to leading economic indicators, the result has been record trade deficits of nearly $900 billion. By circling the corporate wagons rather than bravely moving into new territories, U.S. businesses have sent clear signals to these major competitors that we aren't interested in selling to 95 percent of the world's population. Granted, sales in most of these areas are only now showing strong promise but the potential is enormous.
As important to a firm's long-term global success in its respective market area is that by retreating from markets outside the U.S., the companies also abandon vital intelligence outposts. Outposts that can keep firms abreast of plans and actions of foreign competitors as well as provide solid inputs for next generation products and solutions.
As foreign firms become more aggressive in the U.S. market as well as on a global scale, many American companies are struggling to determine how they can increase their global activity and presence. Simply having a good global Web site isn’t enough. Firms usually have three choices:
* establish their own corporate presence in key countries
* acquire a small local competitor
* establish a relationship with a local, established distributor
For years, we watched European and Asian manufacturers fail in the U.S. market because they opened their own offices, sent in their own people and launched programs and activities that worked at home. Rather than being deluged with sales, they were overwhelmed with disappointment.
As a result, international distribution often appears to be an easy way to increase sales, but more is involved than simply signing up a distributor in each target country. Those firms that have attempted to impose U.S. policies, programs and activities have found that rather than providing a blueprint for success, they became a roadmap to disaster.
Although it's almost unheard of for their U.S. counterparts, international distributors develop and carry out their own marketing and promotional plans and programs. In most instances they take almost total ownership of the products and their success in their respective countries...including sales, support and service.
Because the distributors are so important, U.S. firms that establish a relationship with them must view it as more than simply signing on a distributor; it's a strategic alliance. Too many firms fail internationally because they fail to fully come to grips with this important distinction, its requirements and its ramifications.
U.S. firms often lack a clear, concise set of international objectives. They often haven't determined which products/services have international appeal and haven't considered the training and support that will be required. In addition, they haven't set down the physical and fiscal commitments they will have to make to ensure the program's success.
Equally important for the company is the development of a strong profile of the ideal distributor or partner they want/need...even for domestic markets. Overseas, the selection process becomes even more difficult. The biggest distributor in a given market isn't necessarily the best organization to represent their products.
Since you are establishing a strategic alliance it is extremely important to ensure that management styles can co-exist and thrive together and that sound personal relationships can be developed.
In making the choice, it is important to understand how distributors operate in different parts of the world. In Europe, distribution varies dramatically from country to country, region to region, and often from city to city. The same is true in the Pacific Basin, South America, and the Middle East except in these areas the distributors are often national in nature. While numerous distribution organizations have expanded their global reach, their "image," influence and penetration can quite different from country to country.
In most of these international markets, distributors not only play a key role in the sale and distribution of goods, they are also a strong marketing and support factor.
They stock inventory. They have extensive lists of important contacts at the governmental and sales level as well as in-depth knowledge of their target markets. At
the same time, they spend considerable time and money developing and maintaining their technical, training, and support expertise.
Even as the Internet eliminates country borders to produce a global economy and global marketplace, too many U.S. manufacturers fail in overseas markets. They never fully come to grips with each area's important distinctions, their requirements, and the ramifications of these differences on how it affects the image, sale and use of their products. Instead, they rush to sign up distributors, fire them, and then sign up new distributors, much as they would in their own backyard.
This trial-and-error process delays sales success and in some instances has caused marketing and financial disasters.
On the other hand, firms that carry out a careful selection process, conduct positive support and training programs, continually monitor their foreign relationships are likely to increase sales and profits.
There are several other reasons for choosing international distributors with care.
Because of the distances involved in these strategic alliances as well as the language and customs barriers, U.S. producers, by necessity, relinquish a part of their marketing
and sales authority to the local distributor. Thus, it is important to ensure that their respective management styles can exist and thrive together.
It is also advisable to document a potential local country's partner's market connections. As aggressive as the global market is today, a company simply can't afford the luxury of establishing a relationship with a firm that doesn't understand its target markets or doesn't have strong relationships in those markets. Management has to keep in mid that one of the key things they are "buying" is the distributor's ability to quickly and economically tap into their markets...with your products.
In most areas of the globe being "the new aggressive, hungry kid" on the block is less desirable. Usually you're looking for established (dare we say entrenched) organization that has extensive, long-term relationships with senior management and key technical personnel at prospective customer organizations. Key personnel in most countries make less than their U.S. counterparts but they have often come up through the ranks and move less frequently from company to company.
Finally, because of the distance between a U.S. company's headquarters and an overseas distributor's territory, it is important to ensure that the distributor's sales force has solid technical expertise, as well as the ability to service customers. With the slim margins firms are forced to deal with today, it is seldom economically feasible to fly service personnel across the country, let alone across the ocean to handle customer problems.
When the supplier doesn't or can't respond to the overseas customer's or distributor's requests, the relationship sours quickly. This is especially true when the company is focusing all of their resources on protecting their market position at home rather than trying to build marketshare in the new territories.
Whether corporate management likes it or not, the local firm will be the company in that country. As we are all coming to realize service and support are becoming increasingly important for future sales. They become pivotal decision factors on the long-term success of a company and its products.
If the company isn't willing to commit the time, money and effort required in helping the individual country distributors become successful for your products and services, management will be wiser to forget about looking at the greener pastures on the other side of the fence and focus on staying in their own back yard.
It's better to be considered fairly good at home rather than a fool on a global scale.
# # #
FINDING GLOBAL SALES PARTNER REQUIRES GLOBAL THINKING - To learn more about this author, visit Andy Marken's Website.
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David AchesonDavid Acheson is the founder of DCJA Consultancy. DCJA Consultancy is a management consultancy business specialising in B2B sales consultancy. They offer bespoke and packaged sales consultancy including Sales Optimisation Review, Interim Sales Management, Sales & Marketing Review, 1:1 Sales & Management Staff Analysis, Management Training, Solution Sales Training, Creation of New Pay Plan, KPI's, run Customer Feedback Campaigns, assist with Recruitment, Coaching, Appraisals and set up Strategic Marketing Campaigns. David spent his early career in accountancy and then moved into sales in 1982, working in Office Equipment, IT, Advertising, Training, Outsourcing and Consultancy. He has held many Senior Positions in SMBs and Global Organisations including Head of Sales Operations & Head of Business Development. His knowledge, skills and great experience of the Sales Industry has led to David making keynote speeches and running educational sessions to key businesses through organisations including The Chamber of Commerce and Business Link. - Visit David Acheson's Website |
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Linda RichardsonLinda Richardson is the Founder and Executive Chairwoman of Richardson, a global sales training and performance improvement company. As a recognized leader in the industry, she has won the coveted Stevie Award for Lifetime Achievement in Sales Excellence and she was identified by Training Industry, Inc. as one of the “Top 20 Most Influential Training Professionals.” Ms. Richardson is credited with the movement to Consultative Selling and is the author of ten books on selling and sales management, including Sales Coaching — Making the Great Leap from Sales Manager to Sales Coach, and Stop Telling, Start Selling. She teaches sales and management at the Wharton Graduate School of the University of Pennsylvania and the Wharton Executive Development Center. Linda is a frequent speaker at industry and client conferences, has been published extensively in industry and training journals, and has been featured in numerous publications, including The Wall Street Journal, Forbes, Nation’s Business, Selling Power, Success, and The Conference Board Magazine. Learn more about Richardson's sales training and performance improvement solutions at http://www.richardson.com web - Visit Linda Richardson's Website |
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Dave KurlanDave Kurlan is the founder and CEO of Objective Management Group, Inc., the industry leader in sales assessments and sales force evaluations, and the CEO of David Kurlan & Associates, Inc., a consulting firm specializing in sales force development. Dave has been a top rated speaker at Inc. Magazine's Conference on Growing the Company, the Sales & Marketing Management Conference and the Gazelles Sales & Marketing Summit. He has been featured on radio and TV, including World Business Review with General Norman Schwarzkopf, in Inc. Magazine, Selling Power Magazine, Sales & Marketing Management Magazine and Incentive Magazine. He is the author of Mindless Selling and Baseline Selling – How to Become a Sales Superstar by Using What You Already Know about the Game of Baseball. He created and wrote STAR, a proprietary recruiting process for hiring great salespeople, and he writes Understanding the Sales Force, a popular business Blog and is a contributing author to The Death of 20th Century Selling and 101 Great Ways to Improve Your Life, Volume 2. - Visit Dave Kurlan's Website |
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Leanne Hoagland-SmithAre your sales where you want them to be? Will you be one of the few who achieves sales or business success or one of the many who have failed to change? Are you tired of being told you are like everyone else? Then you may find my first book on sales of interest. Be the Red Jacket in the Sea of Gray Suits, The Keys to Unlocking Sales available at Amazon or at http://www.processspecialist.com/red-jacket.htm. This book is a reflection of my no-nonsense approach to improving sales to overall business results. If you are truly committed to making sustainable changes, then I can help you secure a positive return on your investment because I focus on executable solutions not telling you the problems you already know you have. From training to corporate (group) coaching to executive one on one coaching, my approach is to assess, create awareness, build a goal driven action plan and then execute. The bottom line question is "Not do you or your employees know it, but do you or they want to do it?" Please call for a free strategy session at 219.759.5601. - Visit Leanne Hoagland-Smith's Website |
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John BrennanJohn Brennan Ed.D. Dr. Brennan is President of Interpersonal Development, LLC, a training and development firm. Interpersonal Development has provided sales training and coaching to more than 3,000 sales reps from over 100 companies. A native of Australia, Dr. Brennan received his doctorate from the University of Rochester. His dissertation researched the effectiveness of Behavioral Modeling Technology in training people in interpersonal skills. While he has spent most of his career designing or delivering training, he was also a Vice-President of Sales of a training and development franchise with operations in 25 markets. Dr. Brennan has designed and delivered sales training in North America, Asia, Europe, Australia and the Middle East. He has been a guest speaker at numerous national and regional professional conferences. When Microsoft wanted Best Practices articles on sales for their web site, they called Dr. Brennan. The results are at http://office.microsoft.com/en-us/FX011387391033.aspx His firm’s clients have included Volvo, The Prudential, Merrill Lynch, Eastman Kodak, Gannett, Equifax Europe, the Economist Group and countless small businesses. - Visit John Brennan's Website |
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Joe DagerJoe Dager is President of Business901, a progressive coaching company providing no-nonsense direction in areas such as Lean Six Sigma Marketing and organized referral marketing. What others say: In the past 20 years, Joe and I have collaborated on many difficult issues. Joe’s ability to combine his expertise with “out of the box” thinking is unsurpassed. He has always delivered quickly, cost effectively and with ingenuity. A brilliant mind that is always a pleasure to work with.” - James R. If you want to learn more about Business901, start a conversation with us. We can be found @ Web/Blog: Business901.com Web/Blog: FundingYourNonprofit.com LinkedIn Profile Follow me on Twitter - Visit Joe Dager's Website |
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