Creating a Distribution Channel for Your Product

A million things go into running a product oriented business. You had a great idea and now you have this product, but then what? How do you plan to compete with other products in the San Francisco Bay Area? Building brand awareness is a job in itself. It is very difficult to have successful product management and even more difficult to do it alone. Some companies that have created a brand for their products are 6 Pack Fitness, Prism, and Bicycle Company. Channel ditributing plays a part in that brand. Creating a distribution channel could benefit your business if you are open to having outside help. 

Channel distribution is essentially a pathway from the products manufacturer to the consumer. This can have as many middlemen as you are comfortable with and will ultimately develop your brand awareness. Ideally in the SF Bay Area, a business is going to want a successful distribution channel that allows its product to be everywhere. Some people like to have full control over their business, which creates an extremely small distribution channel. A good example of this would be homemade goods as they come straight from the manufacturer to the consumer. Or you can have several pit stops between before the consumer receives the product. In an extreme sense you can have your product made by a manufacturer, then sent to a distributor, then given to a wholesaler, who will then market it to retail stores, where an average normal consumer will stumble upon it and eventually pay for it.

Deciding what distribution channel is good for you takes business analytics. It would be smart to create a marketing calendar to understand the demand of your product during different times of the year. From there you can develop customer relationship management programs that allow you to increase product sales during slower seasons. We are going to talk about three types of distribution that can create successful product management. 

          1. An Exclusive Channel of Distribution

This is a great method for high end products or if your product is already in demand, but you are trying to make it more valuable. At the end of the day people want things that are hard to get, especially in cities like San Francisco. This channel of distribution wouldn’t require many outside parties as it is not meant to be everywhere. This exclusive distribution technique would be for a product that is only available in particular stores or even in certain locations. This helps maintain the brand you want for your product, but it limits you customers. Products that use this tactic are Gucci or Louis Vuitton. If the product is worth the branding, consumers in the SF Bay Area will flock. This product tends to create a sufficent customer relationship management due to superior service in the store. 

          2. Selective Distribution 

A selective distribution style would have a bigger channel. Your product would leave the manufacturing site to go to a distributor, who would then bring it to a retail facility. The product is in the hands of a couple groups before it reaches the consumer, but it’s still not many. What makes it selective is that the product has a target audience and still isn’t available everywhere. 6 Pack Fitness is a readily available product, but you can’t get it anywhere or Solar Panel takes a look at their website, but you aren’t having to travel anywhere to get the product. Think of Boudin Bakery only being in the Bay Area. They get their ingredients from a manufacturer, but the bread is made in house and all of their locations are in the SF Bay Area. 

          3. Extensive Distributing Style 

If you want your product to be everywhere and available all of the time, this is the best avenue for you. Think of candy bars. You can get a candy bar at a grocery store, a movie theater, a supermarket, or even at the gas station. This type of distribution involves as many markets as possible, which requires a rigorous channel. You need a solid manufacturer and you might need several locations if you want your product in several areas. Then your distributor would bring it to an agent, who would sell to wholesalers, who then sell to retailers. A lot of people are incorporated, but in this case it is absolutely necessary because all of that work can not be done by a small group of people. 

Product management is a difficult concept to tackle, but it is doable if you know what you want. Once you know that, you can seek out help from other people. Even better reach out to David Mitroff, Ph.D. at Piedmont Avenue Consulting, Inc. for product management advice. He is located in the Bay Area and has extensive experience with helping clients market their product correctly. 

Piedmont Avenue Consulting, Inc. is a San Francisco Bay Area based business development and marketing consulting firm who creates brand awareness, strengthens customer loyalty, and increases lead generation by leveraging new technologies and streamlining business processes. Clients who hire us as marketing experts and business consultants include new and established companies, restaurants, franchises, law firms, high-growth start-ups, retail specialty stores, professional services firms, individual entrepreneurs and other diverse organizations.