As a #trademarketer, you put in much effort to increase sales via your channel marketing. You spend time and money on advertising, marketing, and promotions to attract customers and make sales. You also work hard to maintain good relationships with your #channelpartners like distributors, wholesalers, retailers, and nano-influencers trusting them to recommend your products and help you grow your business.    

But what happens when some distributors start hoarding the profits and rewards of retailers? Unfortunately, this is a problem that many retailers face. Do your retailers face the same problems? But you should not worry – because you can take steps to prevent it.   

The first step to stop this action is understanding "how they do it?" There are several tactics that distributors may use to undercut prices and divert customers away from the stores.    

For example, #distributors may offer discounts or special deals to customers that shop directly with them. They may also sell to other #retailers, leading to increased competition and lower prices. There are chances that they don't pass on the information about rewards and incentives that your brand has proposed and keep those to themselves.  

Why do They do So?  

The primary reasons behind these unhealthy practices are as follows: 

Profit 

Distributors may see an opportunity to earn extra money by intercepting the #rewards that brands offer their retailers. They do this by convincing them that the brand still needs to release the offer for their location.  

Partiality 

#distributors have some favorite retailers. They may provide better or more rewards than others. This kind of partiality maybe spread to the sales teams too. It hurts the brand a lot, as those retailers become loyal to that specific distributor, and others become unsatisfied with the brand.    

Lack of Transparency 

Another factor contributing to this problem is the lack of transparency in the #supplychain. Retailers may only sometimes be aware of the distributors' actions, making it difficult to identify when rewards are not distributed properly. 

How To Stop This? 

Now, you know the reasons. All you need to know is “how to combat these practices and reasoning?” For that, you need to be proactive and vigilant. Here are some steps you can take to protect your channel partners from these kinds of unethical practices because you truly believe in “Happier Channel Partners make Healthier Bottom Line.” 

1.) Build strong relationships with your distributors and channel partners  

One of the most effective ways to prevent distributors from stockpiling your retailer’s profits is to build #strongrelationships with them. When you have a good relationship with your distributors, they are more likely to be loyal to you and less likely to engage in tactics that could harm your business. You can build these relationships by communicating regularly, being respectful, and fulfilling your end of the bargain.  

For brands, having a strong distribution partner is like having a trusted ally in the market. It allows them to focus on other aspects of their business.

2.) Use technology  

Technology can help brands track the distribution of #rewards and identify when they are being misplaced. It can include using barcodes, RFID tags, and other tracking technologies to monitor rewards movement throughout the supply chain. Along with that, technology can be used in the following aspects:  

• End-to-End platform: Where you and your #channelpartners can engage, inform, and monitor every sale and rewards distribution.  
• Omni-channel Communication: Technology can provide a single platform where anyone can communicate with anyone without following a strict hierarchy.   
• Engage retailers directly: Technology can allow brands to engage with #retailers directly, know their pain points, and inform and teach them about their products and schemes.  
•  Give them a support platform: A single platform to resolve everyone’s problem is always attractive, and when mixed with better support, it can be an advantage for a brand.  
• Conduct frequent meetings: It can be very effective and motivating for your #channelpartners. By doing this, they feel valued, and their concerns are heard.   

  3.) Monitor your sales and pricing   

One of the best ways to prevent #distributors from undercutting your prices is to regularly monitor your sales and pricing. It means keeping track of your sales volume, profit margins, and other key metrics. You should also be aware of your competitors' prices and adjust your prices accordingly.  

4.) Offer value to your Retailers  

The next practice to avoid unethical practices is by offering value to your retailers. It means providing excellent customer service, offering unique products, and creating a great shopping experience. When customers see the value of shopping at a retailer’s store, they are less likely to be swayed by discounts or promotions offered by distributors.  

5.) Establish clear policies   

Brands should establish clear policies regarding how #rewards are distributed and who has access to them. These policies should be communicated to all stakeholders, including #distributors and #customers.  

  

In conclusion, #brands must be cautious about their distributors and take appropriate measures to safeguard their profits and rewards. By being proactive, you can effectively prevent distributors from hoarding their #profits and #rewards. Ultimately, it is the responsibility of the brands to safeguard their business, and these steps can help them achieve that goal. 

Almond's #channelverse is an award-winning #b2b #loyalty and #channel #engagement ecosystem used by all sizes of companies globally.

With Almond's Channelverse, you can start B2B loyalty programs in less than three days and engage your channel partners with exciting activities, events, games, and instant rewards. We welcome all questions at channelverse@almond.solutions

Channel Champions is an Initiative of Almond www.almond.solutions