How do Principals Evaluate Distributor Performance?

Principal Relationship with Distributor

Distributors are responsible to disperse products to areas that are more easily accessible to consumers. Unlike principals who are responsible for producing the highest quality products and creating product branding, distributors, in addition to maintaining product quality and branding, must also ensure product availability and visibility in the market.

Principal’s Concerns about Distributors

To become a superior product in the market, principals must work with distributors who are also superior. If the distributor’s performance suddenly declines, the principal must analyze the cause. 

1. Distributor does not reach the KPI target that has been determined.

It could be that the newly opened outlets do not increase while the outlets that are still active reduce orders or don’t even order products anymore. 

2. Distributors prioritize products from other principals

Some principals partner with distributors who also take goods from other principals (non-exclusive distributors). Some distributors may end up switching to other brands if your product prices are less competitive, lack of promotions, are rarely offered by salesmen, or even not maintaining a close relationship with you.

Advotics Distributor Performance Monitoring

In addition to storing information in the form of a distributor name, distribution zone, status (active/inactive), the Advotics Distribution Management System (DMS) can make it easier for principals to monitor distributor performance with custom target parameters.