As mentioned in this post, I think medical device distributors are not commodities; on the contrary, they are key assets on which a company’s profitability is built, and this is the essence of medical device distributor management.
For a medical device manufacturer, finding a valuable partner could be a challenge; it requires a rigorous process and a bit of luck.
However, once you’ve found the right partner to sell your products in the assigned market, the job has just started; your next concern is how to keep the distributor engaged and selling your products.
Well, that’s the topic of this post. Below I’ve listed 6 ways to keep your distributor engaged and selling for you.
#1 Focus on your most valuable distributors
Develop a classification of your distributors based on their “VALUE” as basic strategy of medical device distributor management, where A are the most valuable distributors, and C are the less valuable. Next, define a business policy to give the best support to the A organizations and limit support to the less profitable.
For example, A distributors, which are the strongest customers for the manufacturer, should always get the best support within the bounds of company policies. In contrast, B distributors are treated well, but after the A. Conversely, the C distributors get support on an as-available basis.
Why is this classification so important?
Normally distributors’ demand for support, attention, help, resources, etc., exceeds the available supply of the manufacturer. Without a clear policy based on value, everyone is treated the same, and the typical result is that everyone gets poor support which is absolutely inadequate for the most valuable distributors.
Manufacturers’ area sales managers, who typically deal with several distributors, should define their level of support based on distributor value, which is a combination of sales results, sales efforts, competencies, potential, market opportunities, etc., increasing their effectiveness and the results of best distributors.
The key to building on success is learning the characteristics that make the best distributors successful and working hard together to make them even more successful.
Instead of building on success, sales managers often waste valuable time and resources trying to compensate for an underperforming organization.
Well, compensating weak performers is not the best way to get results; actually, it rewards non-performance and penalizes successful organizations.
More so, management-by-weaknesses is a common behavior. Companies want to avoid underperformance and failure at all costs. Therefore, they ask their sales managers to work to make their territories look homogenous and well balanced, giving the image of everything under control.
#2 Provide adequate sales support
Here there are 2 key and equally important elements. The first is adequate, and the second is sales support.
What does it mean to be adequate?
As usual, it depends. As a manufacturer, you need to balance the requirements and capabilities. Likewise, to avoid frustrations, distributors and manufacturers should define what level is considered adequate.
What is sales support?
One size fits all doesn’t work anymore. Consequently, sales support could be different according to the distributor’s needs. Some may need salesforce training, some international KOL support, and others co-marketing initiatives.
One common example is reliable and timely support for the sales organization of the distributor. Without this fundamental component, everything else will not be helpful.
In fact, providing technical data, literature, technical support, a quote, special pricing, a proposal, an expected delivery date, etc, getting back to the counterpart quickly and committing to a deadline should be normal. Slow, unreliable, and inaccurate responses discourage the people who make requests.
#3 Provide continuous learning through multiple platforms
The topic of sales training has already been addressed here.
The sales organization’s success is not only dependent on the sales training. I’m firmly convinced that the aim of sales training is a successful sales organization that meets mutually agreed objectives regularly.
The distributor’s sales organization, including the CEO, sales manager, sales reps, field specialists, and the customer service staff, should be in a continuous training program. The training must be adapted and specifically designed according to the specific role.
Sales reps, in particular, should be constantly trained on managing the full customer journey from interest and awareness to purchase and product experience. It’s common knowledge that athletes must train every day, else they will lose their competitive advantage. The same applies to sales reps.
Sales effectiveness requires dedication to continuous training on the part of the sales reps, their organizations, and their suppliers.
As for professional sportsmen, the training must cover the complete needs, and different tools should be used. For sales reps, a blend of diverse training instruments should be provided by the manufacturer to cover the specific requirements of the individual distributor and the different needs of sales reps.
For example, in-person classroom training, in-person workshops, focus courses, webinars, self-serve resources available for FAQ, automated online training, virtual classrooms, sales manuals, etc should be made available.
#4 Establish an advisory council of distributors
Create a distributors’ advisory council whose members are their organizations’ CEOs or sales managers. The idea behind this is to establish a working group composed of a few (4 to 6) people belonging to your key distributors.
The group should meet with the manufacturer’s leaders once a year to exchange ideas, plan, suggest improvements and consolidate the relationship.
For the manufacturer, the value is to multiply, further develop the relationship with the most valuable distributor, collect recommendations regarding several aspects of the business (new product, new features, new service, etc.), understand the business issues, and develop the agenda of the distributors meeting.
For the distributors, the value is the opportunity to better communicate the market issues, suggest product improvements, share best practices, improve alignment with the manufacturer and more importantly, feel valued.
#5 Organize distributors meetings
Over the years, I have participated in a lot of sales meetings, playing different roles from a participant, presenter, speaker, invited person, special guest to the organizer.
I think sales and distributors meetings can be very productive, but in some situations, the lack of clarity on the “why, what, who, and how” can dramatically reduce the effectiveness.
As a rule of thumb, if the only thing clear to the participants and organizers is “when,” it is not a good sign.
The most rewarding and productive sales meetings are participative, interactive and everybody involved (from the manufacturer and distributor sides) should share the same perspective on the sales meeting.
The preparation is extremely important; it should include a definition of the objectives, selection of the issues to be discussed, defining the speakers, developing the agenda, and promoting attendance among the distributors.
The meeting’s agenda should include propositions coming from the distributors’ sales reps and management. If some topics are not relevant for the entire audience, some specific breakout sessions should be organized to increase effectiveness and participation.
Manufacturer’s senior management should be called in to listen to the main issues, recommendations, needs, and agreed action items.
The distributor’s meeting is also the right moment to award prizes to the most valuable partners to recognize the distributors who have achieved excellent results in their specific market.
How to evaluate the success of a sales meeting?
There are a few indicators: first, the results of the participant’s anonymous survey, sales growth or distributors engagement metrics in the following months after the sales meeting. Then, the endorsement of participants from distributors, and its impact on the manufacturer’s concerned staff.
For sure the most important result is the increase in sales. However, other metrics frequently have quicker reactivity than sales; therefore, these metrics can provide the earliest success or failure response.
Lastly, in sales meetings, you should avoid organizing, monodirectional, unilateral, uninvolving distributors meetings where people just listen to presentations and have minimal exchange. The worst case is a disengaging meeting full of propaganda.
#6 Share top distributors’ results
Although it has to be managed very carefully, sharing among the top distributors their relative ratings could stimulate a positive competitive dynamic.
It is the responsibility of the manufacturer to develop performance categories and peculiar metrics meaningful to the distributors.
Publish and share the ratings quarterly and award the winner once a year. Unfortunately, competitive ratings do not stimulate low performers to do more and become significantly better.
Conclusion
The process of identifying, selecting, and getting a distributor to sell your product is complex and requires a lot of resources from both parties, manufacturers, and distributors. Medical device distributor management, that is basically keeping your distributors selling your products is likewise challenging.
Getting maximum performance from distributors requires a systematic approach. By following the 6 suggestions above, you can increase cooperation and communication with your best distributors.
This, in turn, will increase revenue and develop the full benefits of a distributor-based sales model.
Do you have other ideas to keep your distributor selling for you? Let me know your thoughts in the comments below and subscribe for more.