As I was discussing during my radio program a few weeks ago, China is now officially the world’s second largest economy …

[display_podcast]

… overtaking Japan and as far as we can see the business opportunities will continue to rise in the coming years. After my very first business consulting seminar in Shangai [in Channel Marketing Strategies] focussing on the Internet and Distribution,

it was very educational for me to learn from some of the executives who I was standing in front of for days delivering the first of many marketing strategy seminars and consulting sessions.

Having managament from different industries all desiring to have their needs met meets with certain challenges, however as I am striving for excellence – I was happy to stretch myself up into new comfort zones.

With there being a shift from China just acting as a manufacturing arm for many of the world’s Multi National Companies to being an economy that is innovating and producing goods and services that needed domestically and internationally, we see a corresponding need to learn from the west in terms of process management and strategy development. The point is that – by learning in the form of taking in business consultants from the West, the country will save itself years in terms of trial and error, not to mention the amount of money that goes with that.

With all of the dynamics that goes into piecing the economies of the world together, as a business consultant I can see many opportunities for strategyt consultants like myself to lending a hand to the development of the economy of China.

With that said, I look forward to many more interactions and learning from as well as assisting Chinese [based] companies to grow and prosper as the dependency on the strength of business China continues to be one that is growing.

The topic of company expansion came up during my last radio program, during the discussion I went on to give an explanation of some of the

[display_podcast]

options open to corporations looking to expand their businesses internationally.

Of course – the assumption is made that the company is making the moves to expand internationally for all of the right market driven reasons !

In terms of dealing with the path to deliver the product overseas, the company will typically make one of two choices :-

  • setup office in the target country
  • select a distribution partner to deliver the goods

Of course, in order to setup a direct organisation with sales force and all of the other necessary staff, the business would have to be able to justify this by the amount of revenue that it proposes to generate. On the other hand – by selecting a distributor the company will be able to enter into the market at a much lower cost.

On the surface – hiring a distributor and letting them get on with the job of selling seems quite straighforward – however, this is where we get into the sometimes complex, frustrating and challenging field of international distributor management.

Note that part of the battle will be in being able to gain distributor mindshare – this is because your products could well be one of literally hundreds that your new channel partner is selling. With that various products may well be providing your international channel partner with greater margins, more market share, more support and close relationships that what you currently have.

With so much of the cost of products being taken up by the delivery network and management, it is interesting to see how little time is spent dealing with this oh so necessary topic. Certainly when I studied my MBA and, specialised in International Trade and Finance there we minimal focus on this compared to topics such as the marketing mix for example.

Some of the greatets challenges facing companies today is in this area of international disributor channel management and; with very few managers being able to say how much cost of serving up the product through the channel …

  • gross margins ?
  • margin mix ?
  • contribution margin ?

… actually costs [and I mean documented quarter by quarter – and not anecdotal]; this will continue to be a management area that will by itself demand more focus and attention.

The financial section of my distribution channel management training is always one that provokes much discussion and with the international distributor being by definition removed from the supplier company – process management and data flow plays a significant part in the field of international partner channel management.

Questions, comments ? would love to hear from you.

-Stephen C Campbell

Intere

During my radio program today we discussed the marketing mix [many people know this as the 4 P’s] as this was requested by one of the listeners. For those of you who are not familiar with the Marketing Mix, the 4 P’s stand for :-

  • Product
  • Price
  • Promotion
  • Place

… now when we talk about distribution channels in marketing, this topic falls under that P of Place. That is to say, where will the end user customer actually end up purchasing the product and/or service that is produced by the company in question.

If you consider a company like coca cola and how you can go almost anywhere in the world and purchase this soft drink, you can begin to get an idea of how important channels of distribution in marketing are for businesses of all sizes. Of course none of us ever purchase Coca Cola from the company itself – instead we purchase from a retailer who would have in turn purchased from one of many possible distribution channels. There can be many intermediaries in the supply chain which of course all adds to the final price paid by the end user.

In my consulting and training work – this topic of distribution channel management is continuing to be an ever important one. How is your company doing in terms of actively managing your distribution partners ?

  • Are you working in partnership ?
  • Do you know their margins ?
  • Do you know their fixed costs ?
  • Do you know how much your products are contributing to their fixed costs ??

As the price that the end user pays for a product continues to be tied to the costs incurred in getting that product to the end user, training and consulting requirements on this subject matter will rise and those companies that make the incremental necessary changes in this respect will be those that take more market share and ultimately be the ones that excel.

As always, any thoughts, comments or consulting requirements ? don’t hesitate to get in touch.

-Stephen C Campbell

Yesterday, on my weekly Business Radio Program where I provide quality information on Business, Sales …..

[display_podcast]

…. Marketing, The Internet, Globalisation and more !! I made a brief book review of Sheila Elliott’s ‘My Business Is My Business [Learn How To Earn A Fortune’] as the content is bang in line with the theme of the program. Listen to the podcast above for the summary review but here are the main points covered [which are based upon the chapters of the book] :-

  • Why Do You Want To Start A Business ?
  • Putting Your Vision Into A Strategic Marketing Plan
  • Exuding/Creating Confidence In Your Business
  • Financing Your Business
  • Running A Customer Focussed Business

… in line with previous week’s discussions and our review of Tom Peter’s ‘The Brand You 50’ and the specific discussion on :-

  • What do I want to be ?
  • What do I want to stand for ?
  • Does my work matter ?
  • Am I making a difference ?

… [this is taken from page 18] >>> in line with that; if you’ve listened the program you will be familiar that I am always talking about the importance of

  • Categories
  • Segments
  • Channels

i.e. all products and service fit within a particular category of the market place, those products and services are sold to specific segments of the marketplace and finally those products and services must by definition pass through a marketing channel.

Sheila Elliott’s book ‘My Business Is My Business’ is spot on and very relevant in today’s economic climate, I will be completing the review sometime soon – in the meantime, do yourself a favour. Grab a copy !!!

Let me know if you have any thoughts, comments or business collaboration ideas

I am asked many questions about business and, now that I have my own weekly business focussed radio program, one of the questions that I am constantly asked is that of where the internet fits into ones overall business strategy. Before answering the question here, one of the main mistakes I see being made by the business owner is :-

  • Throwing up a website
  • Placing multiple Ads in Yellow Pages
  • Placing Ads in the classifieds

Not that there is anything wrong with using any and/or all of the items above but what I often see is that this is normally done without the use of a coherent Business Marketing Strategy. Unfortunately, most do not see the reason for taking time up front in order to put time [and money] into :-

  • Defining the message of your product/service
  • Working on your brand
  • Looking at Marketing Channels
  • Going through the Marketing Segmentation exercise
  • Pricing

… and, of course – the list could go on and on. The point is that large companies have qualified people in marketing departments working on these components all day long so, how important should this be for the small business owner. Of course this is business people such as myself come into play with being able to site down and to spend time with the business owner who is not skilled in marketing and to be able to help them to develop their core business marketing plans.

This is where we come to talk about the internet and how it should be viewed in the overall context of the business – I have run out of time, so will continue this in another post shortly.

What do you think ? any comments ? do let me know.

Best,

-Stephen C Campbell