How To Choose The Right Distribution Channel?

Where do I want people to find my products? The very first and completely spontaneous answer of every entrepreneur would be everywhere – at least mine would be.

But do we really want that? How to make the right choice? How to manage the beginning of things when your production capacity is not so big yet?

I have the chance to participate in this year’s Proveg acceleration program and we had an afternoon on distribution channels and targeted customer.

Here’s a mix of all the input I got from that discussion and from my experience with retailers. We’ll focus on B2C businesses, B2B ones having to address different challenges.

Don’t send samples, get appointments.

Even with the little experience I had, this is something I can only advise now. It’s very simple: every time, I had an appointment and got the chance to present the project, the product was listed. And every time, I just sent samples, they weren’t. So what makes the difference? Oxytocin does. You knew it, right? Ever heard about Paul J Zak?

Find out the dos and don’t about each distribution channel Talk to people, talk to people. You’ll probably find people who had the worst experience with retailers and people who swear only by retail. And then, you’re not further forward, right? In reality, you’ll be. Because you’ll be able to validate or invalidate your gut feelings with facts. You’ll be able to evaluate if that precise channel fits what you want for your business and for your brand.

Find a lighthouse customer

This is a critical point. A lighthouse customer is sort of an early adopter but on a bigger scale. It’s a customer who will understand and support the project. He will enable you to have a showcase for your products but also to learn a lot. This customer will give you a lot of input on how you can improve customer experience and your product itself. But not only will he give you feedback, you’ll figure out a lot of things by yourself. Then, once things work out well, you can go to other customers with the first proof of concept and replicate. Magical, right?

Amazon: the ultimate channel?

The peaks of Amazon are surely that they take care of all the logistics and payment issues. And then, you receive a check every two weeks. Sounds like a dream. But there are some things you have to know about Amazon before throwing yourself into it.

First, what you want to do is open your own store to be able to control the prices. Because Amazon runs by itself and then, you’ll just get to talk to robots and if they fuck up your prices, you’ll probably get very angry at the robot. And it won’t bring anything. Amazon has a 1% defect rate and they always stand on the customer’s side. So, if customers return your product for whatever reason, Amazon will refund them at your expense. And you better watch that you don’t cross that 1% threshold because otherwise, Amazon will just close your store.

Build the demand as fast as possible, as slow as necessary

Of course, you want all people to buy your product. But you want to ensure consumers have the best first experience with it. And you want to make sure the stores don’t run out. That’s why the lighthouse customer method is a very smart one. It allows you to focus, get feedback and get better right away.

If you’re in a sector like the plant-based one which is booming but still struggling, the challenge goes beyond your own brand. If you have a dairy alternative, for example, you want to fight to have your product along with classic dairy products because there is much more traffic in this area of the store. Here, the smartest thing to do is probably to join forces with other brands that have products of the same type. Instead of considering them as competitors, go to retailers together and work on building the best consumer experience. That’s how you’ll build the demand and you’ll all benefit from that.

Finding the right distribution channel can seem to be really tricky. And you’re probably going to say that I repeat myself but you have only one way of knowing which one is the right one: test, test, test.

Camille Tomat
Entrepreneur

camille@impatient.me

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