Distribution Strategy for FMCG Products
FMCG, which stands for Fast Moving Consumer Goods, tend to be priced on the lower end of the spectrum, have leaner margins and higher volumes, unlike durable consumer goods. Some products falling under the FMCG distribution categories are detergent company products, soft drinks, food and beverages, soap, domestic cleaning supplies, beauty care products, personal care products, cosmetics and so on. These products (including detergent company product) are found in a wider variety of retail outlets, including convenient stores and drugstores, where they can “fly off the shelves”, as the saying goes. FMCG company often faces distribution challenges in India, given the steep competition.
Many FMCG brands have a streamlined distribution system and sales channel, in both metropolitan and rural areas to transfer products to retailers and eventually, the end customers.
However, with the sheer number of products in the FMCG category, competition is fierce and you need to have a distribution strategy for FMCG products. For FMCG distributors to improve their profits, and to ensure that their products can successfully make a sale they need to develop a well-defined marketing and distribution strategy. You need to apply certain sales promotion techniques for FMCG products. FMCG sales techniques include scouring the market for competition, as this helps hone your business strategies.
Here are Some Tips:
1. Know Your Competition
Knowing your competition is one of the best ways to keep ahead of the trends. It lets you make smart decisions. In other words, avoid getting lost. Find out where your competitors are and how they market and sell. Create a strategy which is unique to your business. Find out where their channels of distributions and sales lie. This information can help you make a wise decision. For instance, when deciding to introduce a product in a certain area, if no products of your competitors are found, then it is a wise decision to find out why your competitors aren’t found in that particular region. Which brings us to the next point.
2. Market Research
Of course, knowing your competition is rarely as simple as counting the number of competing businesses. You will need to do in-depth research in order to learn how much your competitors are selling and how well they are doing; whether they are ramping up products and introducing new formulations; what price points and branding they are using; and what kind of volumes and margins they are generating. Once you have a reasonably good picture of the competition, you can begin to map out the best strategy to use for your business accordingly.
3. Customer Service
Excellent customer service is one of the keys to improving business profits. Satisfied customers make for one of the best word-of-mouth – make good customer service a priority. Your profit success relies on it. When a customer leaves good feedback, it creates a domino effect –customers will look for your product and in turn, leave amazing feedback. Here is the caveat – your customer service and product need to be exceptional if you want to be successful.
Examine your current customer service scenario and make tweaks in the process wherever required. Ensure you are communicating to your customer at every stage of the sales cycle. Ensure that your business is providing service superior to that of your competitors. This can be achieved by investing in staff training, revamping your policy, or basic improvements such as talking politely and helpfully with customers. Make sure your customer experience team responds promptly to voice mail or email from customers.
4. Quality Over Quantity
They Focus on Quality Over Quantity
Use high-quality ingredients that reflect in your products. Use locally sourced non-toxic chemicals and azo-free ingredients – this will cut your expenses. Not only that, it is safe for the consumers and is eco-friendly. Maintain the highest of quality standards – review this policy continuously and strive to be the best. Monitor the products and their utilization, like specific ingredient formulation that are biodegradable, and maximize cost savings.