Monitoring Your Distribution System

By CFOGlobalHQ / November 8, 2012

Monitoring Your Distribution SystemOne of the most difficult relationships to balance in business is between a company’s production and its distribution system. A problem in one area can spread to create problems in another, and soon the entire organization of a system can be thrown out of whack. Keeping both parties happy and efficient is a frequent problem higher management faces. A company’s financial situation can be disrupted and even ruined if the distributor cannot deliver on its promises.

Monitoring your distribution system is an important step to take in order to meet and remedy problems before they get out of hand. However, before you even begin to monitor your distribution system, you need to approach distributors in a certain way. One should cover exactly what you expect from a distributor and be forward with them about it. Creating the right relationship from the beginning goes very far for ensuring a successful partnership. Communication is key.

Another important issue to nail down before monitoring your distribution system is training. If your distributor has a sales force, don’t rely on their internal team to sell your product. Take the time to train them on your own product. Help them create a market for your product just as much as you do. This will ultimately benefit both parties in the end anyway, as a solid interaction between producer and distributor is good business for both parties. A little extra work initially pays off for a long time afterwards.

In order to successfully monitor your distribution system, you need to be detailed and goal-oriented from the start. Make sure you list your goals for working with the distributor and check up on them at regular intervals. This allows you to ensure everything is going as it should. It also indirectly forces the distributor to do the same. Knowing that you are monitoring the system and making sure goals are being met makes it more likely that the distributor will do all they can to comply.

Regular monitoring keeps everyone involved on their toes. This means that things should run smoothly for longer periods of time. It’s vital to be consistent in your monitoring for it to be completely effective. Besides, as someone in higher management or a business owner, it’s natural to be involved and care about your work. Take ownership of the relationship between your company and the distributor just as much as you take ownership of your other responsibilities. If you do, problems will become less and less frequent.

[via Entrepreneur.com]
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