The dealer is not your customer or employee; they are your partner in a mutually beneficial relationship. Treating dealers solely as customers or assuming they work for you can lead to misunderstandings. Instead, focus on mutual benefit to create a successful partnership that drives sales and profitability for both parties.
This may be unpopular, but the dealer is not your customer. The dealer is also not your employee. The dealer is your partner in a mutually beneficial relationship. Everything you do in managing your dealer relationships needs to be bedded in the foundation of mutual benefit.
Not the Customer
Many manufacturers and territory reps fall into the trap of treating their dealers like customers that need to be sold to. This is flawed because the dealer does not want your product. The dealer wants the proceeds they will get from selling your product. The dealer wants to purchase your product and sell it as soon as possible for a profit. The shorter the time, the smaller the effort and the less problems that arise in selling your product, the more attractive the relationship is and the more willing your dealer will be to sell your product.
Not Your Employee
The second most common trap we see manufacturers fall into is thinking the dealer works for the manufacturer and will do what they are told without question. This philosophy gets perpetuated in good times when it seems the dealer is “behaving”. Often it appears the dealer is doing what they are told when in reality the behaviors are producing mutually beneficial results, products being sold. Then the manufacturer gets a rude awaking when they try to implement behaviors that are not mutually beneficial and get push-back. Why isn’t the dealer doing what they are told? It is because they are an independent business working towards their own good. If you get push-back from your dealers on new initiatives, you may need to step back and ensure what you are asking of them is going to be mutually beneficial.
Mutual Benefit
The ideal manufacturer relationship is setup so that no one party can be successful with the other party also experiencing success. This happens when the dealer purchases product at the target profit of the manufacturer and sells it to produce the target profit for the dealer. Every decision that is made needs to consider the mutual benefit the manufacturer and dealer.
The Dealer is Your Partner
They are often successful local businesses full of creative, ambitious professionals that are standing by to help move your product. When the partnership is structured correctly there is no more powerful sales team than a robust dealer network.
