Four Considerations For An Underperforming Export Market

There are many reasons why an export market may be underperforming. You may be tempted to think that the distributor is simply not up to the task, but a knee-jerk reaction like immediately switching distributors is not only time-consuming but costly and even counterproductive.

More often than not, there are a handful of factors causing the problems and knowing what to look for will help you turn things around and dominate your category.

Share of Shelf, Pricing and Promotions

Share of shelf, pricing and promotions are all fundamental to the success of a brand in any market and these variables are constantly shifting.

When a competitor brand makes a move in any one of these areas to increase its performance, a ripple effect is created for all brands in the same category.

To stay ahead of these changes, share of shelf and pricing need to be monitored regularly and a steady Advertising and Promotion (A&P) programme is vital to drive sales. Even tactics as simple as secondary displays (space buys) can make a noticeable difference.

To succeed, be sure you are supporting your distributor with A&P funds and collaborating with them to monitor what is working so your marketing investment is finely tuned to yield the best results.   

In-Market Feedback

Distributors carry a wealth of market knowledge. They are constantly perusing retail buyers and keeping a close eye on what sells, where it sells and what drives those sales.

Combining this valuable insight from your distributor while independently reviewing the category will often reveal what the source of the issue is.

It is helpful to also have relationships with experts on the ground as quick resolution equals less time and therefore less sales lost.

Distributor Engagement

Maintaining a good working relationship with your distributor via regular communication keeps your brand top of mind and gives you direct access to information that you would not be able to find elsewhere. A word of warning though, fostering a good working relationship is not about ‘policing’ your distributor. Think collaboration. And be sure you are very polite as this attribute will serve you and your brand well, particularly in Asia.

Expectations and Roles

Let’s assume you’re working with a reputable distributor with nationwide coverage. Yet, for some reason, your sales are not going well.

Before any decisions are made that the distributor is no longer the right fit, it’s important to go back to the beginning. Were expectations set properly? Is everyone aligned? Do all parties understand what their roles are and who they are communicating with?

Finding the right fit is not only about finding a distributor that is a good match for your export strategy, but is a partner who is willing to collaborate with you over the long term to develop and execute a strategy that is going to increase sales.

In my experience, switching distributors should be a last resort and a more productive solution is often right under our noses. Bare in mind that launching and thriving in an export market does not always go according to a linear plan. When an export market is underperforming try to avoid casting blame and stay at the table with your distributor to understand why the business is underperforming and what can be done to turn the ship around. Is it a pricing issue? Is it a lack of marketing activity? Is it the channel strategy? Often through this collaboration, pragmatic solutions will come to the fore that can be implemented with everyone’s buy-in.