How to open a distribution company. Distributing as a full-fledged business How to become a clothing distributor

Text by Daria Sharkova

Photo by Elena Ryazanova

For the first time in the "Success Stories" section, we will tell you about an alternative form of creating your business - through distributorship. Elena Lapko first became a distributor in Krasnodar, and then the official representative throughout Russia of the famous Dutch accessory brand NOOSA-Amsterdam. Our heroine has created her own network of regional distributors from scratch, overcame three financial crises in the Russian economy and learned to predict which jewelry will be liked by customers in our country.

Elena Lapko

NOOSA-Amsterdam: the essence of business

I am the official representative in Russia of the Dutch accessories brand NOOSA-Amsterdam. And she started as a distributor in her native Krasnodar, where she sold their products. And then she became the main partner and created her own network of regional distributors. Now I have a full-fledged business: my own team, my own channels for attracting clients and promotion, my own turnover and revenue.

My business is based on distributing accessories: I buy collections from the NOOSA-Amsterdam head office in Holland and then sell them in two ways - through distributors or in stores.

About the brand

NOOSA-Amsterdam - handmade accessories: bracelets, bags, belts, wallets made of leather. Replaceable buttons for them are made of natural materials: shellfish, wood, bone, resin and lava, as well as natural minerals. These things are created by craftsmen in Nepal, Indonesia and Peru by hand on the order of the company. We also have a jewelry line Relics, which presents earrings, rings, bracelets, chains and pendants made of silver.

All leather accessories are decorated with removable buttons - each reflects the culture of one of the peoples of the planet, carries a sacred meaning. By choosing symbolic buttons, our customers, for example, make wishes or protect themselves from what they want to avoid. The buttons are easy to attach and just as easy to remove. That is, buyers themselves create the design of their jewelry and can change its appearance at least every day.

For me, working with NOOSA-Amsterdam has always been not just a business, but a lot of love. If the brand's accessories had not met on my life path, I would hardly have gone into other business.

Getting to know NOOSA-Amsterdam

I am one of those people who never in childhood and adolescence thought about the possibility of starting a business. When I was in high school, I realized that I wanted to interact more with people, so I entered the Faculty of Psychology. After university she worked in various companies in Krasnodar. The positions include both office manager and HR manager in a large Western company. At that time, as I wanted, I was in very close contact with different people. Perhaps it was thanks to the experience of an HR manager that I began to realize how to find an approach to everyone, understand needs, be able to listen and hear.

I met NOOSA-Amsterdam by chance. In 2012 I went to Amsterdam, met in a cafe with my Dutch friend. We talked and drank coffee. I noticed on her hand a bracelet decorated with unusual buttons. The accessory captured my attention, and I realized that I just needed to get the same one.

A friend took me to the store. It was a typical European multi-brand boutique where actual clothes could be complemented with various accessories. The treasured bracelets were in the window near the cash register. When I asked the employee to show me the buttons, I saw three large boxes - more than a hundred symbols in total. It was a real delight! Then I still did not understand what all these signs mean, and I chose replaceable elements intuitively. The happiness of owning the very first bracelet is unmatched! I carried this emotion into my heart through all the years of working with the brand.

Many people who buy NOOSA-Amsterdam products for the first time have very similar feelings to mine. I don't want to take off the bracelet, without it there is a feeling that I left the house naked. The accessory becomes a part of you! And so I returned to Krasnodar from that trip to Amsterdam with a NOOSA decoration on my arm.

The amount of the first purchase was 150 thousand rubles. I could choose the ways and channels of sales myself

The idea of becoming a brand distributor

All friends and acquaintances, when they saw the bracelet on my hand, could not, like me in my time, hide their curiosity and delight. This is the quality of our jewelry. They started asking me where I got it. Interestingly, there was already a Russian representative office of the brand in Moscow. But at the same time, few people knew about him. And after another question from a friend, the thought suddenly occurred to me that I could become a distributor of this company and tell many people about accessories.

The amount of the first purchase that the brand offers to the distributor was (and is now) 150 thousand rubles. Compared to other retail companies, this amount is relatively small; in addition, the distributor constantly has the opportunity to make additional purchases, expanding the range and, accordingly, increasing the turnover. That is, I needed to buy buttons, bracelets, belts and bags for this amount and boldly start selling them. I could choose the ways and channels of sales myself.

At that time, I had no fear of starting a business: the reaction of my Krasnodar acquaintances turned out to be eloquent - everyone really liked it. Without giving myself time for doubts, I wrote a letter to the head office of the brand - in the Netherlands. They, in turn, redirected me to a representative office in Moscow. I talked with the management, found out all the terms of cooperation. They also looked at me closely, realized that I realized what I needed to do, what kind of product it was and what its target audience was.

I was infinitely inspired and confident that this is my calling and that everything will work out for me. I made the decision to start my first business, having received the approval and support of other members of my family. My husband was happy that I would be able to combine business with raising children, broaden my horizons, make new acquaintances, and my daily life would go far beyond the scope of housekeeping. I still thank my relatives for this.

The Moscow office received my consent and began to collect the parcel with the first order.

Interview. Womenbz journalist Daria Sharkova and entrepreneur Elena Lapko

I was given a box and allowed to transfer money when there is an opportunity

Start of cooperation

We agreed with representatives of the brand in Russia to meet at the Moscow Sheremetyevo airport, where I had a transfer: I was to be given a box with the first purchase. My husband and I wanted to withdraw money from an ATM at the airport, but everything did not go according to plan: the first plane was delayed, we arrived late and did not dare to run to the ATM so as not to be late for the next flight.

The representative of NOOSA-Amsterdam without hesitation gave me a box with the words: "This is not a problem, take it, transfer the money when possible." I felt that this is another good sign when starting a business is associated with such total trust.

First sales. Going out to shops

First, my friends began to come for bracelets, then friends of friends. Then word of mouth worked well, because in my environment there were always interesting personalities who liked unusual things. In a matter of days, the Nusa brand was on everyone's lips and began to sell "by itself." I had to be constantly in touch in order to select bracelets and buttons every day for those people who aspired to become a part of the NOOSA world.

There was a lot of excitement, buyers wanted to buy new items, to have items that at that time I did not have in stock, and the first purchase was immediately followed by the second. American marketer John Trout once formulated a law according to which the regular expansion of the assortment in a short time will inevitably lead to an increase in sales. It worked in my case too.

I decided not to confine myself only to a circle of acquaintances. I wanted more people to know about the brand. The next step was a cooperation agreement with the CosmoStore accessories chain, which, by the way, did not work for many years under a commission agreement with third-party suppliers. But for me, they made an exception, because as experienced buyers understood: unique products will attract a large number of new buyers. At first, I placed the accessories on the terms of sale, that is, I received money after the sale. Then, when the owners of the company saw the commercial success of the brand, the chain began to shop for the collections. Today, as almost six years ago, NOOSA-Amsterdam collections are widely represented in the flagship CosmoStore store in Krasnodar.

Events developed really quickly, and I asked the Moscow office for permission to expand the geography of sales. I began to conclude contracts with stores in Novorossiysk, Gelendzhik, Vladikavkaz, Rostov-on-Don. I found outlets through the Internet and on the recommendations of mutual acquaintances. During that period, for about a year and a half, she worked without assistants.

I personally came to official representatives in different cities of the Southern Federal District, gave presentations for sellers, demonstrated photo and video materials, shared inspiring stories and told how to work with customers correctly, offering store visitors not only a high-quality and beautiful accessory, but also a unique amulet, and a good gift for those closest to you.

It is difficult for the Dutch to understand that in Russian cities, located at a distance of 300 kilometers from each other, people have different mentality, lifestyle, wealth, priorities, interests

My favorite business was about to disappear, and, of course, I simply could not accept it. I sighed, made up my mind and wrote a letter to the head office in the Netherlands. She introduced herself, told about herself, about her successes and asked to make an appointment. A couple of months later I flew to Amsterdam.

I prepared a business plan to convince them not only with my emotions, but also with the commercial component. She talked about what has already been implemented and what is planned. She focused on the mentality of different regions - something that Holland cannot know. It is difficult for them to understand that in Russian cities, located at a distance of 300 kilometers from each other, people have different mentality, lifestyle, wealth, priorities, interests. The founders of the brand were convinced not only by the indicators of my business plan, but also by the fact that I want to familiarize people with good taste and knowledge of the symbols of world cultures.

Then they asked me one question: "What is the difference between you and our former partners, a company from Moscow?" Without thinking, I said: "They liked it and I love it". Literally: "They liked it, and I love it." And that was pure truth. I have always treated the project primarily as a favorite business, and not as a business. Until now, all this for me is at the same level of love.

The result of our meeting with the Dutch was the signing of a contract for a year. We "looked closely" to each other, I made regular orders for collections according to the purchase budget, while developing a network of distributors in Russia. A year later, I confirmed the status of the exclusive representative of NOOSA-Amsterdam in the country and I keep it to this day.

I continue to delight them with numbers: for example, in 2017, our turnover increased by another 20% compared to 2016.

How to become a distributor - brand partner in Russia

Today I am building a network across the country. I work with distributors in different regions. Those who want to cooperate with us, to be a representative of NOOSA, choose which way of implementation and development is closer to them. There are two such options.

Shop or showroom... In this case, you need a platform on which the entire range of brand products will be presented. Partners buy and sell collections from themselves. The retail cost of products is the same in all regions of the country, while the brand is high-margin. In this format, we cooperate with the owners of boutiques in Volgograd, Kaliningrad, Kirov and Simferopol.
Regional office... That is, to work in the same way as I started: to make regular purchases of each new collection. Today, when a potential distributor comes to us who is in love with our jewelry and wants to make money with NOOSA, we tell you what promotion mechanisms can be used, share secrets, and help. In this case, the accessories are sold, as in the first version, at the retail price recommended by the head office in Krasnodar. Official representatives work in 18 cities and regions of the country, as well as in Ukraine and Kazakhstan.

It is convenient for our partners in stores and regions: the entire assortment is available to order at any time, since our main warehouse in Krasnodar has all positions, including products from the regular collection, as well as new items from limited collections.

Often people who are already familiar with our product become distributors. It is important for us to cooperate with those who value each customer and know that coincidences are not accidental. You should have intuition, believe in buttons and share positive emotions with others. Symbols are not magic. This is the power of a person's faith in himself.

We do not charge the distributor in advance for future collections. We take these risks

Buying collections

I get acquainted with new collections 9 months before the start of retail sales. After the presentation of new products in Amsterdam, I pre-order accessories for several months in advance and make an advance payment. For example, orders for products for August and November of this year have already been placed.

My task is to predict how many bracelets, buttons, bags of one type or another we can sell in Russia, which design options our customers will love. At the very beginning of the work, the forecast was more based on intuition, and it was also important to listen to personal taste, present the widest possible range of products and also give the opportunity to purchase accessories from the classic collection, which is currently always in stock with each representative. Now, when ordering, the preferences of buyers from different regions are taken into account.

It is interesting that in Krasnodar the audience, which traditionally prefers bright colors in clothes, chooses more conceptual bracelets, bags and wallets of our brand and builds a look around them. The look is based on black, gray and blue products. And, say, ocher and wine-colored creations are sold better in Siberia than in the south. Petersburgers, on the contrary, often wear colored bracelets and buttons, additionally creating a joyful mood. "Nusamans" in Ukraine, Crimea and Kazakhstan are at the initial stage of acquaintance with the brand, therefore they prefer universal accessories that will suit both casual clothes and evening dresses.

While accessories are making their way from Amsterdam to us, Russian distributors receive a new order form and form a purchase. After the appearance of the next limited collection in our warehouse in Krasnodar, we immediately send products to representatives in the regions.

We make life easier for our distributors: we do not take prepayment for future collections. Thus, partners do not “freeze” 30–50% of the order value for several months - our company assumes these risks.

The advantage of the brand's products is NOOSA-Amsterdam accessories out of season and time. In other words, all products are popular all year round and never go out of style.

Specificity of purchasing in euros

In our country, it is difficult to plan a strategy for several years ahead. Especially when the business is directly dependent on the euro exchange rate, like mine. Our company has already successfully survived three financial crises in the Russian economy. When the ruble was weakening against the European currency, I did not make any harsh decisions: for example, to stop the business, to immediately raise prices and thereby scare away buyers and distributors. Therefore, I kept prices at the same level for a long time. Then the increase was from 5 to 12% for various categories of goods. However, as soon as the situation in the economy stabilized, the ruble “got stronger” and sudden fluctuations in the exchange rate stopped, we again reduced prices.

Interview. Womenbz journalist Daria Sharkova and entrepreneur Elena Lapko

Preparation of new collections for sale in Russia

New limited edition collections appear 4 times a year. Each of them produces, on average, two dozen new products. We independently prepare detailed descriptions of buttons, immersing ourselves in the culture, myths and beliefs of those countries and peoples where the signs depicted on the buttons appeared. Information about all the button-symbols issued by the brand throughout the history can be found on the official website. Also, our company publishes its own booklet, in which the lookbook is side by side with interesting information about the philosophy of NOOSA-Amsterdam.

Retail sales and promotion

We continue to work with retail customers. They can purchase jewelry in our online store. This is a partner project linked to our central warehouse in Krasnodar, and online prices match retail prices across Russia. We are currently refining it to create a unified retail platform for distributors in different regions. It is important for us to launch a portal that has a single visual style, a system of relationships with customers and accounting for products in the warehouse.

We pay great attention to social networks. In 2015, I created a full-fledged Instagram profile. Today it is a working mechanism for increasing brand awareness and retail sales. Each regional representative also has his own Instagram account, in which our partner publishes both copyright photographs and image photographs provided by us. In addition to the materials received from the Dutch, we ourselves constantly initiate professional photo sessions that convey the beauty of accessories, the philosophy of the brand.

Participation in specialized exhibitions is also important. We made sure that such events help to make the brand more recognizable. We took part in Collection Premiere Moscow (CPM), opened a corner within Moscow Fashion Week with the support of Mercedes-Benz. Official representatives of NOOSA-Amsterdam can be found at major regional and Moscow exhibitions, fashion markets and among partners of social events.

About buyers

Our customers are strong, special personalities. There was an opinion that the majority of "nusamans" or, as we also call them, noosapeople are representatives of creative professions. But our accessories are also gladly purchased by young mothers, doctors, employees of financial institutions - in fact, they are deeper and more diverse.

In other words, the main thing for a person is to find a reflection of his inner world in our unusual products and pick up signs that are close to his heart. Our person appreciates things with strong energy, created with soul and from natural materials, realizes his individual style. Once purchasing a bracelet, the buyer after a while aspires to become the owner of the wallet and bag, and having fastened a set of buttons on the accessory, he returns for new symbols.

Employees

At the moment, our team includes, in addition to me, a PR and marketing director, a development director, and a client manager. An accountant and an IT specialist are outsourced.

I try to motivate and reward my colleagues. For example, for the results of their work over the past two years, two employees were awarded a trip to Amsterdam. In general, I was lucky: harmony and mutual understanding reign in our team. This is logical, because we are united by a love for such beauty.

In business, as in driving a car, the rules are the same for everyone: for both men and women.

Competition

In fact, all modular accessories can be our competitors. But still, our customers do not like things presented in the mass market. In addition, nusamans will never buy a fake Noosa Chinese bracelet made of leatherette and with a plastic button.

We occupy the “niche of the unusual”. We are often compared to other typesetting bracelets, such as jewelry with charms, but we are very different, even in appearance. This is a completely different style and, in my opinion, a different philosophy and meaning. If you buy a charm when you want to remember something, then by choosing a button, you “write” your future.

I am delighted that the product we offer to people brings them joy. More and more often, bracelets are purchased as a talisman or a universal gift that carries a positive message, and to a lesser extent - as a simply fashionable product.

About women in business

I believe that in business, as in, say, driving a car, the rules are the same for everyone, both for men and women. The gender of a successful businessman does not matter. In my opinion, it is wrong to believe that if you are a woman, then you will be given a head start.

My own business helped develop my business skills, negotiation skills. It is important for a businessman to have a balance between the energies of Yin and Yang, because if the balance is violated, then the head of the company will not be able to equally use analytical thinking and intuition. Also, success largely depends on personal charisma.

1. Find a balance between work and family life, devote enough time and attention to those you love. Make the people around you happy so that you get that warmth back.

2. As for the risk, it is always justified! There is not a single business that does not have certain difficulties. My business, as I have already said, depends on the euro rate, and I take upon myself all the temporary difficulties caused by the growth of the currency rate. There is no smooth and sweet business. If you are not ready to take risks, your own business is not for you.

3. It is very important to have an airbag in the form of a reserve of financial resources and support of loved ones, to have the willingness and fearlessness to stay afloat, no matter how stormy around.

“There is nothing more criminal than coming up with a great idea, but not implementing it,” says Donald Trump. If you dream of your own business (a beauty salon or something else), financial independence, nothing should stop you, even the lack of start-up capital for business development. When there are a lot of ideas for building your own project, and the financial situation is not the best, you can try to become a dealer.

What is a dealer?

A dealer is an agent of a manufacturing company who acts as an intermediary between the manufacturer of a certain product and a person or legal entity who wants to buy it.

In Russia and other countries, there are manufacturers who do not have their own sales offices and wish to sell their goods through dealer networks. Such cooperation is beneficial for such companies. They do not need to spend money on opening retail outlets. With minimal costs, they can quickly communicate their product information to a large circle of potential buyers.

Dealers are divided into several categories depending on the field of activity. There are intermediaries working on the stock exchange. They are participants in the securities market. Another type buys certain products in bulk and sells them to retail customers. There are representatives of large enterprises, for example, car holdings, which find buyers and receive a percentage of sales. If you decide to become a dealer, first of all decide what area you want to work in.

Becoming a dealer for a manufacturer is not just about representing the products of a certain company, it is being its regional face (for example, a manufacturing company). Dealer sales consist of the following stages:

discussion of cooperation issues, current prices, percentage of sales, etc .;
make a deal;
sale of related products of the plant;
provision of additional services (maintenance, installation, transportation from the factory).

Becoming an exclusive dealer of a manufacturer means getting the right to single-handedly represent a company in a certain region. This status gives privileges in partnership, as the representative gets rid of competitors, receives special financial conditions.

To become an intermediary is to take an intermediate place in the chain "producer - end consumer". Its main role is to find a buyer and complete a deal.

How to become a dealer of a manufacturer?

In order to become a dealer, you need to determine,. But the choice of a manufacturer is far from one criterion. In order to become an official representative of the plant, you need to prepare.

Qualities required to work as a dealer

Practice shows that not all people can become a dealer, as well as, and reveal themselves in the field of trade. Experts have identified a number of qualities that a person should have:

activity;
sociability;
the ability to negotiate, persuade;
stress resistance;
initiative;
competitiveness.

If you see the above qualities in yourself, you can try to realize yourself in this area and become a dealer.

Advice: when negotiating, you must "radiate confidence", since the main task in this activity is to convince that the offered products are of the highest quality.

If you are trying to establish cooperation with a representative of a store or other retail chain, convince him that if you take the product for sale, it will literally be swept off the counter. To do this, you need to be persistent, be able to present the product, indicate its advantages and benefits for the buyer.

It's important to be prepared for rejection. Bad deals are an integral part of being a dealer. Here it is important not to get upset, analyze the mistakes made during the negotiations and move on, looking for buyers.

Required Documentation

To become a dealer of a manufacturer, you need to prepare a package of documents, since this business is serious and can bring a lot of money.

In most cases, large manufacturers require the following conditions to be met to sign a partnership agreement:

you must be a legal entity;
the presence of an office;
conclusion of a mediation agreement.

For cooperation, you must also provide:

passport data;
charter (if you are a legal entity);
memorandum of association;
tax registration certificate;
certificate of state registration;
ownership or lease (sublease) agreement for non-residential premises where the place of sale will be organized;
Bank details.

The list of documents may differ depending on the requirements of the manufacturer. If you plan to work in the automotive business, you need to provide a permit to sell vehicles from the traffic police.

Description of activities

After signing an agreement on cooperation in a certain region, it is necessary to draw up a promotion strategy, a development concept.

At the first stage, analyze the market in the assigned territory, the level of demand and options for promoting products. Identify ways to optimize sales, how to interest a potential buyer. Do not disregard competitors, monitor their work.

After that, you need to try to form your client base. To do this, make a list of companies that may be interested in the product being sold. Before making an appointment with potential clients, inquire about them as much as possible, develop a negotiation technique. The wider the customer base, the higher the income level will be.

If you want to become a dealer from a prestigious company, a large factory, you need to overcome the competition from other job seekers. In order to have an advantage over them, you need to take into account a number of factors.

First, they pay attention to the experience in this area. Secondly, a lot depends on the region of placement. If a representative applicant wants to become a dealer in a city that is saturated with regional representatives of this company, he will most likely be turned down. If the manufacturer does not have a representative office in the specified area, he is more willing to agree to cooperate. The accumulated client base is especially appreciated. Also, the decision on partnership is influenced by:

reputation;
availability of a technical base, premises for work;
the ability to attract qualified personnel;
the possibility of warranty service.

How much money do you need to invest?

Investments are required to conduct intermediary activities. In order to become a dealer of a manufacturer, you do not need the same amount of capital as, for example, to build. But most often investments in the chosen project are needed.

It is difficult to name a certain amount, it all depends on the manufacturer's company. But if you manage to agree with the manufacturer on the receipt of goods for sale, you can avoid large investments. You will be able to pay after the sale of the product, but the price in this case will be higher than with a prepayment.

If you have the opportunity to pay for the goods immediately, then the amount of investment will largely depend on the type of product, the volume of the purchased batch. It is also worth including in the business plan the costs of transportation, rental of warehouses, office space, recruiting, legal and accounting services.

How to become a dealer without investment?

If you didn't manage to collect the start-up capital, you can become a dealer without investment. There are several ways to do this.

Sales of products to order

Perhaps, looking through the price lists for a certain product, you had to see the mark “On order” opposite the line “Price”. This means that first you need to deposit money into the specified account, after which it will be transferred for use. The algorithm for executing this scheme is as follows:

the manufacturer signs a contract with the supplier for the supply of products at the dealer's price;
products are put up for sale at the dealer's point of sale (not the product, but the name of the unit in the price list);
the buyer makes an advance payment, which makes it possible to purchase goods from the manufacturer;
the purchased item is sent to the buyer, who in turn deposits the rest of the money into the dealer's account.

The indicated scheme is suitable for goods of the middle price category. Each person will buy inexpensive products in the nearest store, albeit at an inflated price, but without waiting. For items that are too expensive, an office or store is needed. For example, car resellers rent large areas for showrooms.

Provision of goods for sale

Today, many manufacturers provide their goods for a certain period of time, during which the reseller must sell it. After the end of the agreed period, the products must be paid for, and 1-3% higher than if the dealer paid without installments. The possibility of return is prescribed in the contract. Most often, if the goods are not fully sold, the full price has to be paid, which increases the risk of financial losses for the intermediary.

Free testing

In some cases, the manufacturer agrees to send free samples of their products, which help to test them, present them to potential buyers. For an intermediary, such a scheme is extremely beneficial, but, unfortunately, today manufacturers rarely agree to work on it.

If the idea of becoming a dealer doesn't suit you, consider

Our Russian consumers have long been accustomed to imported goods and they are always in good demand. Therefore, the profession of a distributor is, in fact, in great demand.

Today we decided to talk about how Russian distributors actually work with foreign manufacturers. This area is not often talked about, but this activity is very profitable and the Russian market needs such professionals. Let's talk today in detail about the intricacies of this profession and how to start working in this area.

Main functions of a distributor

In general, the primary task of a distributor is to maximize the expansion of sales regions for any product. Usually, a distributor is an intermediary between the manufacturer and dealers who are already engaged in the direct sale of goods to end customers. Therefore, the function of a distributor usually also includes the creation of a dealer network. One or more distributors can work in the market of the importing country at the same time, it depends on the demand for this particular product from our customers.

Thus, the distributor creates a sales market for the products of a foreign manufacturer in our country, and the greater the capacity of this market, the larger the regional dealer network, the higher the distributor's income.

The distributor himself, after creating a dealer network, may no longer engage in direct sales at all, his main function becomes only to maintain the functioning of the sales chain he has created and generate income from the total trade turnover of goods sold.

Depending on their intentions and an agreement with a product manufacturer, a distributor can become a general importer for a given foreign manufacturer, develop additional services, or, for example, arrange supplies of components. In this case, the responsibility of the distributor will include the warranty exchange of low-quality goods, components and spare parts.

Usually, manufacturers have standard distribution agreements that contain a set of specific conditions, often with specific requirements related to the legal practice of a given exporting country and the characteristics of the product. Often, the contract with the manufacturer also contains an indication of the volume of products that the distributor needs to sell for a certain period of time. All this must be clarified in advance and carefully studied all the terms of future contracts.

When creating a dealer network, a distributor must understand that in the future, a lot will depend on the partner-dealers selected by him, because then they will represent the foreign manufacturing company before the final buyer.

Therefore, the distributor must take care of carrying out the necessary advertising and marketing campaigns in order to create the image of the manufacturer of the product, and its promotion in the domestic market.

How and where to start - step by step instructions

Where to begin:

First you need to decide in which industry and with which product you would like to work;
Study the current situation with supply and demand for these products in the Russian market;
Choose a foreign manufacturing company for these products;
Then you need to carefully study the conditions of work of this manufacturer with distributors, perhaps request to send a standard contract by e-mail;
If at first glance your project looks profitable and realistic, then you can start drawing up your business plan;
When drawing up a business plan, you need to calculate as accurately and in detail as possible all the main financial components of your future project, calculate the main income and expense items, take into account possible risks;
If the business plan has shown that your project is profitable, then you can safely proceed to its practical implementation - your official registration as a businessman (opening an LLC or individual entrepreneur), concluding agreements with partners, organizing an office and a dealer network.

Some subtleties of distributor work organization

First you need to find a suitable foreign manufacturer. First of all, choose your field of activity, define an approximate list of goods, the sale of which is in demand on the market and can bring good profits. Then, on the Internet, look at the data on sales and manufacturers on business websites (for example, the international all.biz website, the European eurolots.com website, the Chinese aliexpress.com website), also find the suppliers' contacts on the websites.

Additional information about a potential foreign partner can be found on the websites of various websites, for example: www.ved.gov.ru, creditreform.com, europages.com.ru.

Then you need to study the preliminary general conditions of the supplier, compose and send him an e-mail - your preliminary commercial offer "in the most general terms".

Usually, the working conditions of a distributor are determined by its status (general, exclusive) and the terms of an agreement concluded with a foreign manufacturing company. The key responsibility of a distributor under such standard contracts is to organize a distribution and marketing scheme for the manufacturer's products, and provide related services.

There is a generally accepted organizational scheme: foreign manufacturer - distributor - dealer - buyer.

There are two generally accepted options:

general distributor, this is when the importer sells goods in his country according to his own scheme, independently or organizing a dealer network;
exclusive distributor, in this case, the transfer of rights to distribute imported products occurs only within the region specified in the agreement with the manufacturer and without the involvement of third parties. In the case, a distributor can usually already work with only one supplier, a foreign manufacturer.

As a rule, the sale of goods and services to retail outlets and specific retail customers, as well as all the necessary interaction with them, is carried out by a dealer hired by a distributor.

It is the responsibility of the dealer that includes direct sales, not the distributor; it is important to always remember this when organizing and ensuring the effectiveness of the sales scheme. Only a clear delineation of all responsibilities and functions allows you to create and maintain effective business projects.

Based on the specifics of the product and the current market situation, a foreign manufacturer may have one distributor or several, this also determines the basic terms of the agreement between the manufacturer and the distributor. The current market situation and specificity of goods also determines the conditions for organizing a dealer network and the intensity of the work of the distributor himself.

Some foreign manufacturers already have some kind of representative office or just an office in the importing country, then it is quite easy to establish interaction with the manufacturer-supplier, since the company's representatives are already well acquainted with the peculiarities of the work of Russian business and it will be easier and faster for you to agree on everything with them. ...

If a foreign company does not have any representatives in our country, then establishing contacts will require much more time and good command of a foreign language. First of all, it will be necessary to study the specifics and basic conditions of work of a foreign company with distributors, as well as familiarize them with the peculiarities of Russian conditions. In this case, you will also need to make several foreign business trips, conduct presentations in a foreign language. Such negotiations and approvals require significant time and additional effort - you will have to independently study a lot of additional information, be ready to explain a lot and convince partners of the economic profitability of the project, and negotiations will have to be carried out at the international level and according to international business standards.

It is very important here to competently prepare and conduct negotiations and presentations in front of potential foreign partners. It is very important to study all the nuances of cooperation, prepare a competent business plan and presentation, present a forecast plan for purchases and sales.

But the complexity of direct preliminary international negotiations with a foreign manufacturer, which does not yet have its representative office in our country, will then pay off, this will allow you in the future to act on his behalf at all events held in our country and exclusively represent his brand.

It is necessary to say a few words about the organizational and legal form of the distributor, foreign partners, partners and buyers in our country are always more willing to interact with legal entities than with individuals.

To engage in distribution activities, it is better to choose the organizational and legal form of a legal entity "LLC" than an individual entrepreneur, this is more usual for partners and causes more confidence. For dealers, however, both forms and "LLC" and "IP" are quite acceptable.

The legal form of a dealer, rather, depends on the business personal qualities of a businessman, and the regional specifics where he operates.

It is important to know that some foreign companies already have their own list of requirements for potential partners, as well as approximate schedules and volumes of deliveries of their products through export channels, requirements for financial performance, volume of consignments, minimum deliveries and sales.

Sometimes foreign manufacturing companies put forward requirements for distributors according to their regional location, availability of warehouse and retail space, technical equipment, and even impose some requirements on personnel.

Some foreign partners make their own forecast plans for sales of products, use data from Russian statistics on economic activity in a particular selected region, demographic situation, and demand for similar products.

Foreign companies always use well-calculated business models, and therefore, you must be ready to competently substantiate your position in the negotiations, provide various additional data, provide explanations, and convince of the mutual benefits of the upcoming partnership. During negotiations, it is also important to show that you will be able to organize an effective dealer network, arrange sales of products in the required volumes, maintain and develop a regional network in the future.

A distributor, being an official representative of a manufacturer, can usually count on his commercial support. We also note that, often international nonsense is interesting to consumers in itself, it may already be known and has proven itself well, perhaps many consumers would like to purchase such products.

Possible schemes for working with foreign manufacturers

Sometimes a contract with a manufacturer can impose rather strict conditions on a distributor and restrict the freedom to make his independent decisions, it is also possible to impose penalties on the part of the supplier, if the terms of the contract are not met, the minimum level of sales. This must always be taken into account. And sometimes, on the contrary, the distributor is given the broadest authority.

As already noted, sometimes foreign manufacturers prefer to work with only one Russian distributor partner, and sometimes large manufacturing companies choose distributors for each specific group of their products or for regional segments.

Some distribution agreements stipulate that it is the responsibility of the importer-distributor to organize representative offices of the brand in their country, as well as service centers and regional points of sale. But usually, nevertheless, distributors work through dealer networks and do not engage in direct sales. In this case, the main functions of a distributor are organization of a dealer network, regional expansion, advertising promotion of products, organization of presentations and other events related to attracting new consumers. All these conditions are negotiated with the foreign partner in advance, even before the conclusion of the contract.

The conclusion of a contract is a very important and responsible event for a distributor, since international contracts usually provide for the statement in the contract of the smallest details of cooperation between business partners. International agreements are usually drawn up in two languages, usually English and Russian.

When various disputes arise, foreign partners usually rely on the text set out in English. In addition, they immediately prescribe in the agreement the consideration of all disputes in a foreign jurisdiction. You need to know this and be ready for it.

Some domestic entrepreneurs choose for themselves a scheme of cooperation with a foreign manufacturer under a dealer agreement. That is, they are ready to combine both dealer and distribution functions, but they enter into a “dealer” agreement, which is usually more “flexible” and gives the entrepreneur more freedom of independent action. But let us note that usually according to this scheme, more attention will need to be paid to direct sales, less opportunities for advertising and service support from a foreign manufacturer. It is also important to note that such contracts provide for the delivery of goods on a prepayment basis. There may also be some additional conditions on the timing of the return of defective or illiquid products and other restrictions. In some cases, such a scheme of work may not be very acceptable.

In any case, whatever scheme of work you would not choose for yourself, it is necessary to study in advance, stipulate and spell out all the terms of partnership in the contract.

How much you need to invest and is it possible to do without capital investment

In general, the organization of any business requires at least minimal investment. If you do not have the ability or desire to make the necessary start-up costs, then in this case, then offer your foreign partner the distribution of forthcoming financial costs between the parties or postpone them in time. For example, you can ask for a trial delivery of goods on a deferred payment basis or pay-as-you-go, that is, after receiving the proceeds from the sale.

This option is quite acceptable if the contract is concluded with the provision of bank guarantees or additional insurance for the delivery of goods.

If you competently prepare all the necessary papers, then foreign partners may well agree to work according to this scheme.

There is also the option of concluding an agency agreement. If such a scheme of interaction is implemented, the ownership of the goods remains with the manufacturer, and the distributor receives only his agency fee (commission). Perhaps the agent's fee is less than the distributor's estimated income, but it allows you to do without the "start-up" costs.

"Start-up" costs usually include the following costs:

costs of preparing a business plan;
presentation preparation and advertising costs;
travel expenses;
purchase of a trial batch of goods;
fare;
office rental costs;
warehouse rental costs;
other organizational costs.

The size of the necessary "start-up" costs depends largely on the products you choose and the expected scale of activity.

You can reduce the initial costs if you do most of the work yourself, without attracting additional personnel, as well as carry out the implementation through your own website or websites of online stores, negotiate direct deliveries from the manufacturer at the time you need and self-delivery.

Business plan

A business plan is a very important document that allows you to clearly calculate the main financial indicators of a future project. In addition, another important task of the business plan is the presentation of the business project to potential distributor partners. A competently drawn up and accurately calculated business plan is in many ways the key to the successful implementation of any project.

Any business plan should include the following sections:

Project summary - here it is necessary to give a general description of the project;
Marketing plan - this section should include an assessment of the current market situation for a given product, an analysis of supply and demand, it is desirable to present an analysis with data on specific regions, target audience. Analytical and statistical information for this section, at the initial stage, can be taken from the Internet;
Organizational plan - in this section it is necessary to outline and calculate the scheme of your upcoming distribution activities;
Risk assessment - in this section of the plan, it is necessary to indicate and assess possible potential risks for this type of activity, as well as propose ways to minimize them (for example, risk insurance);
Conclusion - here it is necessary to give a general assessment of the economic feasibility of this project, to show its profitability.

In fact, for distribution activities, the main costly section is the “Organizational plan” section.

This is due to the fact that the costs of Marketing, namely marketing analysis, can be done independently using the Internet, and the costs of online advertising are minimal (set yourself any amount that is acceptable for you).

Risk assessment is, as a rule, only an approximate calculated amount. Bank guarantees can be issued. It is possible to conclude insurance contracts with insurance companies, but this will already require some costs.

Purchase of a consignment of goods 1 million rubles;
Office rent - 100 thousand rubles;
Payment of utility bills and communications - 12 thousand rubles;
Warehouse rent - 100 thousand rubles;
Transportation costs - 30 thousand rubles;
Salary of employees - 150 thousand rubles. (3-5 people);
Payment of taxes and fees 40 thousand rubles;
General organizational and administrative expenses - 20 thousand rubles;

Thus, we have received a very approximate amount of total costs - 2,352 thousand rubles.

Conclusion

As you can see from our short business plan, the bulk of the cost is spent on the purchase of a trial batch of goods. This item of expenditure depends entirely on the type of goods and can vary greatly. In addition, as we said above, there are quite acceptable options to negotiate with the manufacturer on deliveries without making an advance payment.

This is followed by an item of expenses for renting an office, but now most of the work can be done at a home computer or rent an office with a minimal area - this will significantly reduce the costs of this item of costs.

The cost of renting a warehouse can be removed or at least reduced by organizing direct deliveries to retail outlets or dealerships. Transportation costs can also be greatly reduced by shifting these costs onto dealers and building a more careful import schedule. In addition, you can save a lot on operating costs if you do not inflate the staff and effectively build the entire organizational structure and sales chains.

Distribution activity is just such a type of activity where the initial investment and operating costs are largely determined by the businessman himself.

Distributorship is one of the relatively new areas of activity that everyone has heard about, but not everyone knows what exactly distributors are doing, and they certainly are not aware of how to become a distributor.

To figure out how to master this interesting and lucrative profession, let's first find out who a distributor is and what his job is. Translating this word from English, you will immediately understand what it is about: "distribution" in Russian means "distribution". The distributor receives the rights to sell the products of a large manufacturer, which he distributes for sale among dealers - small wholesalers. A commodity can be both products and intangible cultural objects, such as films, and services, and copyrights, and technologies.

A distributor is an intermediary between a manufacturer and a dealer, retailer or buyer. It can be one person who takes goods from a factory and delivers them to customer stores, and a whole company that sells the goods of a giant manufacturer around the world. The distributor earns his income from the large discount percentage that the manufacturer gives him.

The distribution chain of a product can be short (manufacturer - distributor - buyer) or long, when a distributor sells a product to a dealer (intermediary), who in turn resells it to a buyer. Such multi-tiered schemes are more often typical for goods of foreign companies, the delivery of which to our market is carried out in several stages. For example, a manufacturer entrusts the sale of large batches of household chemicals to a distributor located in the capital, who sells them to dealers located in regional centers, and they resell them to smaller dealers in cities and towns.

The difference between a distributor and a dealer is that the former acts on behalf of the manufacturing company and does not receive ownership of the goods, while the dealer acts on his own behalf, purchasing the goods at his own expense.

True, this classification is rather arbitrary, since the statuses of the dealer and distributor are not prescribed by law, but are determined exclusively by contracts. So, in many cases, a distributor can purchase goods from a supplier at his own expense, thus becoming, in fact, large wholesale buyers, reselling products to small wholesalers, that is, dealers.

Another difference between a distributor and a dealer is that distributors are not liable for the products supplied. For example, if a company sold a defective product, then the return and exchange will be made not from the distributor, but from the manufacturer. But the dealer needs to be more careful - he is fully responsible for the quality of the product and solves the problems at his own expense. Distribution work is aimed primarily at creating a distribution network and product promotion, dealership work at delivering products to the end consumer.

Consultants for network companies such as Avon and Oriflame are also called distributors - they send an order for products to a direct supplier and receive them, paying their own money or prepaid money from buyers. In this case, they do not bear full financial responsibility, since they can return the goods to the manufacturer in the event that the buyer has refused it (though not all, but only partially). But, again, this rule does not work everywhere; in many network companies, distributors have to buy out all the goods for their own money.

There is such a thing as a general distributor - a company that has been granted the basic right to distribute goods, as well as an exclusive distributor with unique rights. Manufacturing companies often set up distribution companies themselves.

One manufacturing company may have several distributors, and one distributor may have several suppliers.

Of course, a distributor does not sit and wait for dealers to come to him - his duties include promoting goods, finding buyers and expanding the market.

To become an official distributor of the company, you need to sign a special distribution agreement and obtain a certificate approved by the CEO. The distributor can then distribute the goods provided by the manufacturer at a price determined by the agreement.

But in this case we are talking about large firms cooperating with supplier companies. If we talk about small businesses, then working with a manufacturer will most likely have to be a dealership with a full purchase of products.

Where to find suppliers?

The easiest way is to fill in the phrase "looking for distributors" in the search engine line of an Internet browser and familiarize yourself with the manufacturers' proposals. This kind of entrepreneurship can be done from scratch without any prior sales experience.

Another option is to determine the section of goods you are interested in, for example, bedding, and find enterprises on the Internet that produce the desired products. On the websites of these enterprises there are always contacts - phone numbers and e-mail. You can call them or write a letter with an offer of cooperation.

This requires draw up a small business plan, which will indicate in which region you are going to work, coverage of the territory, number of employees, availability of transport, customer base, available turnover of products.

After a preliminary agreement, the second step will be to familiarize yourself with the product - for this you need to meet with the supplier and examine the samples. During this meeting, it is useful to find out some information - how advertising is organized, how many distributors the company already has, whether they overlap with you regionally, what are the terms of delivery.

If the plans are Napoleonic, then before looking for large clients, you need to register an enterprise, find a warehouse, transport, workers, and organize a dealer network. Serious manufacturers prefer to deal with distributors who have already demonstrated their quality work locally.

It is much more difficult to become a distributor of a foreign company with a larger turnover - for this you need to have experience of similar activities in your own country, an established customer base, understand hidden economic processes, have significant funds for promoting the goods, because it is the distributor who advertises the manufacturer.

You can also become a representative of a network company and receive money not only from the difference in the purchase and sale prices, but also from the work of the involved consultants. In this case, the difficulty lies in the enormous competition.

There is another opportunity - to become a professional, you need to go from the bottom up in any large distribution company, gradually rising from a merchandiser to a sales agent, a supervisor, and so on, until you get to the level that you consider sufficient for yourself. Along the way, you can get an economic education. This option is longer and more difficult, but promises to achieve greater heights than simply reselling goods.

To become a representative of one of the most popular cosmetics companies Avon, And make money without leaving your home, it is possible on the official website http://myavon-company.ru

Where to look for buyers?

Again, customers can be found online. For this, an online store is suitable, in which you post photos and descriptions of goods. If we are talking about mediation between the supplier and the store, then you will have to study in detail all the outlets of the selected area. Some of them are also represented on the Internet, but most of them do not have Internet sites. Therefore, you will have to walk with samples in the desired area, talk to the owners of outlets and get orders from them.

Newspapers and classifieds sites will be a good help - through them you can find customers, partners, and employees.

At first, most entrepreneurs do everything themselves or together with relatives who are ready to work for the future - they are looking for manufacturers and a sales market, pick up and bring goods. Over time, if turnover grows, additional workers are hired. Of course, if there is a large start-up capital, then the situation is completely different.

Distributing is a convenient activity for individual entrepreneurship. In this case, a person works for himself, receiving orders from stores and bringing them goods, all his earnings depend only on his own energy and desire to work. This work will also help mothers on maternity leave or students - taking on a small turnover, you can devote only part of the day to customer service.

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The concept of distribution came to us from the English language and has become familiar to our ears for a long time. In the most general understanding, distribution is a type of activity in which a business entity purchases goods from a direct manufacturer and takes an obligation to him to retail or wholesale these products. However, this activity includes other areas of work related to the development and implementation of logistics processes, the organization of distribution networks and the distribution of goods.

There are two main views on this small business:

On the part of the manufacturer of products, distribution consists in organizing channels for selling goods and effectively managing their movement from the manufacturer to the end consumer.
From the side of the distributor himself, this activity is considered as a process starting from the placement of goods on the territory belonging to him and up to bringing the products to the consumer.

Thus, both directions complement each other, and, in accordance with which of them is accepted as dominant, different types of distribution can be distinguished. Even an individual entrepreneur can legally act as a distributor. But, as practice shows, the most effective way to conduct this activity is through the creation of a distribution company.

General principles of activity

As mentioned above, in distribution, the interests of the manufacturer and the supplier ultimately practically coincide. Consequently, a distributor can act both on his own behalf and on behalf of the manufacturer, identifying himself only as a supplier. As a rule, these approaches are combined.

Between the two main business entities - the manufacturer of the product and its seller - an appropriate agreement is concluded, in which the principles and conditions of cooperation are clearly distributed and spelled out. They can also be considered as step-by-step instructions for creating a company from scratch. This:

Production cost.
The amount of markups applied for the goods sold.
Wholesale trade conditions.
Discounts and preferences policy.
General description of the market and its regional distribution.
Target audience of consumers.
The procedure and conditions for making settlements.
Terms of sale of commercial products transferred by the manufacturer to the supplier.

The amount of the distributor's income depends mainly on how competently he calculates the profitability of the business, what equipment he will use to run it, whether it is profitable for him to select the premises, transport, and staff. Most often, the income of an entrepreneur-distributor has a variable value, because it is determined by seasonal factors of consumption, the volume of supplies of goods from the manufacturer, the time of settlement with buyers on specific terms for each sale.

Legal regulation

It may seem strange, but Russian legislation does not regulate the distribution agreement in any way. Neither the Civil Code nor other laws and regulations contain any normative provisions about it. However, since paragraph 2 of Art. 1 and item 1 of Art. 421 of the Civil Code of the Russian Federation determine that legal entities and individual entrepreneurs are free to choose the terms of the agreement (except for cases when these agreements contradict the existing legislation), then they act as a legitimate legal act that has no restrictions on the territory of our country.

Some features of the legal registration of a distribution company are available in the case when it sells goods from foreign manufacturers. However, even here the terms of the contract and other documents require additional elaboration only in connection with the nature of the products sold.

Distribution pitfalls

As practice shows, this business idea has its pros and cons. According to experts, the main problems that you need to know about before creating a company and entering the markets are:

Where to start looking for an intermediary market, and how to organize access to it.
How to hedge the risks associated with distribution activities.
How to independently assess the prospects of the supplied technologies and goods.

Opening a company in Russia should be accompanied by the understanding that the domestic distribution market is well developed. This is evidenced by the fact that many product niches have already been distributed and occupied, and stable and long-term ties have developed between manufacturers and suppliers. Nevertheless, in the system of these relations there is often a rather low level of professionalism.

The main problem, both for novice entrepreneurs who are just thinking about opening a distribution company, and for acting subjects, is the price of the goods. This factor gives rise to objective obstacles when working with quality products.

To overcome them, many distributors open parallel training centers, where, at their own expense, they help customers understand the merits of the offered product. It goes without saying that this entails additional costs, and therefore requires a very prudent attitude from a novice entrepreneur when choosing a brand that he intends to promote in the retail or wholesale markets.

Another common mistake when starting a business is to misjudge the size of these markets. Among the new challenges for distributors, one cannot fail to mention a high level of competition for certain groups of goods and lack of freedom in their promotion. Only a high reputation can solve this problem - that intangible part of the business, which is formed during a very long process, but begins from the very beginning of the company's functioning.

Eventually

Before opening a distribution company from scratch, you should understand that our country is a huge market for this activity. Therefore, at the initial stage, it is necessary to direct all efforts to the development of your data portfolio for effective cooperation and the development of competent tactics of interaction with both manufacturers and end users.