Mastering Channels

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Mastering Channels The Entrepreneur

• Derby Management

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Mastering Channels

• Rules of any channel selection...
• Experienced management is an absolute.
• Margin is above all.
• Flexibility is vital.
• How many Links in the Chain?

DERBY MANAGEMENT CONSULTANTS
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Mastering Channels

• Rules of entrepreneurial channel selection
• How much money do I have to invest?
• What margins do I need tomorrow?
• What geography do I need tomorrow?
• How technical is the sale?

DERBY MANAGEMENT CONSULTANTS
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Channel Selection

• Experience Counts
• Your most important hire.
• Combined with inputs from
• Heavily experienced consultants
• At least one board member
• End customer survey data

DERBY MANAGEMENT CONSULTANTS
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Margin is the Name of the game

• Margin Control
• You must understand
• What the channels expect
• The flow of the cash
• yours and the channels
• Share of Mind

DERBY MANAGEMENT CONSULTANTS
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Whats Typical ?
Jacks Widgets
End Users
DERBY MANAGEMENT CONSULTANTS
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Whats Typical ?
Jacks Widgets
End Users
Marketing Message
Sales Direct Rep
National Regional Distribution
DERBY MANAGEMENT CONSULTANTS
Sowhos the customer ?
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Disintermediation

• Take out the middleman
• Break the links in the chain.
• Look for the most efficient connection.
• Control ( and keep) the margin.
• Control the message .

DERBY MANAGEMENT CONSULTANTS
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Disintermediation

• Where is the inefficiency?
• Why does the customer care?
• Who gets the benefit of the change?
• Is the business better with or without?
• Will the customer accept the change?

DERBY MANAGEMENT CONSULTANTS
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Disintermediation

• CB Sports and Polo
• Outlet stores no reps, no retailers
• Lands End, LL Bean
• Catalogs no reps, no retailers
• Merrill Lynch, Prudential
• Telemarketing no agents

DERBY MANAGEMENT CONSULTANTS
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Disintermediation

• Auto-by-Tel, e-Schaub
• Internet no reps, no retailers, no wholesalers
• Whats Next?
• Customers who are suppliers
• Suppliers who are customers
• e commerce

DERBY MANAGEMENT CONSULTANTS
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Technical Design Ins

• Hybricon and Lytron
• Both have 6 markets/ 3 targeted
• Both have 3 teams 1 RM, 1 Inside, 1 SAE
• Lytron sells direct
• Hybricon sells 13 US rep firms 1
  Israel 1 Europe

DERBY MANAGEMENT CONSULTANTS
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Technical Stand Alone

• Cambridge Heart
• 4 RMs, 3 Clinical Specialists
• Industry spokespeople
• Highly targeted hospitals

DERBY MANAGEMENT CONSULTANTS
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Technical Commodities

• NETsilicon
• Detailed market data
• Consistent expansive direct mail
• Direct sales
• OEM sales Xerox, Sony
• 1 SM, 1SAE

DERBY MANAGEMENT CONSULTANTS
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Technical Commodities

• Cobotyx
• No salespeople
• ATT major customer
• IBM major outsourcer
• Tied ATT IBM together
• ATT sent margin to Cobotyx
• r

DERBY MANAGEMENT CONSULTANTS
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Consumer Food

• Chatham Village Foods
• 3 RMs , 16 direct
• Control the Shelf Space

DERBY MANAGEMENT CONSULTANTS
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Consumer Medical

• MDI Instruments
• 5 RMs, 2 TMs, Online
• Physicians 2 national distributors 5
  regional distributors
• Parents Premium catalogs National
  pharmacies Mass Merchandisers
  Discount stores

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Mastering Channels

• Rules of any channel selection...
• Experienced management is an absolute.
• Margin is above all.
• Flexibility is vital.
• How many Links in the Chain?

DERBY MANAGEMENT CONSULTANTS
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Derby Management Providing sales and
management coaching to emerging
companies in New England Strategic Sales
Analysis Sales Management CoachingSales
Organizational Planning Strategic Business
PlanningMarket Research Customer Needs
Analysis The Customer Voice Senior Management
Coaching 20 Park Plaza Boston, Massachusetts
02116Tel. [phone] Fax [phone]
Email jack_at_derbymanagement.com Website
www.derbymanagement.com