When you have developed and tested your new product or service, you will need to choose what sales channels to use to maximise your sales.
These days in competitive and uncertain markets both business-to-business and consumer businesses need to select sales channels carefully because of the increased costs of distribution and face-to-face selling.
Start-ups and small businesses are increasingly using a mix of different sales channels. These may include a retail store, a direct sales person who calls on larger companies, agents to serve the business outside its home market and an online store.
Small businesses may not be able to compete on price against larger businesses. Where the small business’s strength lies is what is called the patronage buying motive. This means that customers or clients choose a small business because of service offered, quality, location, store loyalty and friendly behaviour.
Large retailers fall short on service. Here is where the start-up or small business owner can provide a level of service that meets the Goliath hands down. Small businesses can offer service with their products which could include home delivery, free installation and free repair and maintenance. These services would need to be built into the price.
On-line selling or e-commerce is enabling small businesses to own a professional identity on the Internet and enrich their customers’ experience. An e-commerce enabled website is within the budget of many small businesses. When customers visit a small business retail site they can read “How to” information on products, download detailed specifications, see the product being used on a video and look at testimonials from customers who have already purchased.
The advantage of online selling is that it can be done through software-as-a-service (Saas) or hosted software. What this means is that hosted software, for which a monthly fee is paid, can handle your point of sale transactions, invoicing, shipping and back-end accounting.
Whether you use one channel such as direct sales, a retail store or multi-sales channels for your new product or service, you need to weigh up the costs and benefits of each. You need to regularly monitor your sales channels to determine their performance for your specific product or service.
Technology is revolutionising distribution. John Sununu says: “Whole industries including music distribution, yellow-pages directories, landline telephones and fax machines have been radically reordered by the digital revolution.” In planning your sales channels identify where you can innovate to compete more effectively.