What to know about distributing your products in North America
Tuesday, October 02, 2018
North America, and the United States in particular, is one of the largest markets for selling just about everything, particularly home furnishing products. And while the rewards can be great, the cost of entry is also great.
The problem is directly related to the size of both the U.S. and Canada, as well as the diversity within each country in terms of regions and their buying needs. If you are a manufacturer considering entering the marketplace, here are a few considerations.
First, product does not sell itself, it needs to be sold! No matter how unique or underserved a market may be for your product, if people don’t know about it, they cannot buy it!
Secondly, people are fickle, there are various reasons someone will buy your product or someone else’s, and reasons may not always be obvious: price, quality, availability, perceived value. Thirdly, what is the best way to market your product: online, in a retail store, in a trade showroom, or door to door (so to speak)?
This article is going to focus on the modes of distribution in the design trade community, not the overall marketing (or retail) since I’ve already written a book on the subject, but suffice to say, your graphics and digital media presence must be seamless!
Now, the next important question is: how much money do you have to invest in distribution? It does you no good to be able to manufacture a product without getting it distributed, so you need a budget. Once you have established a budget of how much you have to spend and how best to allocate it, you will be able to determine what you can afford to do.
On a macro level, there are various trade shows that happen once or twice a year that various buyers and designers attend, including High Point, North Carolina; HD in Las Vegas; and NeoCon in Chicago.
But showing at one of these locations involves a lease (short- or long-term), getting product to the show, and attending with as many salespeople you need to effectively "work" the show. Of course, you’ll also need marketing materials and samples, because design professionals will want a color swatch, finish sample, brochure, etc. to take back to their studio libraries.
Another option is a physical showroom to display your products in either a trade-only design center (by last count, there are 15 in the U.S.) or perhaps a showroom on the street (to the trade or retail as well) in a city. But which city?
Where do you want to be based? New York, Los Angeles, Miami? Leases and potential tenant improvements are often costly, not to mention the expense of ongoing staffing needed, assuming you can find top staff to sell.
Business leaders need to know the leading products and influential players in each market. And bear in mind, the U.S. has at least five (maybe six) distinctive geographic regions, and what sells in the South may not do so well in the West, or Northwest region, etc.
What about outside selling representatives, people to knock on the doors of A&D professionals to show your product and to learn about what projects the studios are working on?
Do you hire someone to work for you full-time (“corporate” rep), or perhaps a multi-line rep who will carry your line with their other, complimentary lines? And which territory/states do you have them cover? Will they work for commission only? What kind of sampling will they need?
And lastly, who will manage these all-encompassing sales efforts? Just because you open your doors or have a rep carrying your line, does not mean that they are telling the story of your product well, that they are motivated by it, or really know how to sell technical aspects of it, if needed.
This usually means that the owner or a sales manager is going to travel and check on displays (has the multi-line showroom put your product out of sight, out of mind or even on the selling floor?), ride with reps and make calls to help them answer questions. This takes time and money, but must be done.
If all of this sounds daunting, it should! It is very easy to spend money and not get results and nothing pains me more than businesses trying to enter the North American market without doing proper research, and then budgeting appropriately for their initial foray, including operating capital for the first year, after initial launch expense. The quickest way to failure is to not be prepared!
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