Choosing a suitable distributor can be a minefield, especially if you are not familiar with the territory. It’s worth noting that retailers buy from distributors for reasons other than the products they provide. A good distributor provides a number of advantages that cannot be obtained from a manufacturer directly, such as sales and marketing, ordering flexibility, inventory support and availability, service and delivery, credit terms, technical support and single source convenience.
In the case of this restricted and highly legislated market, distributors also manage licensing and the associated import paperwork and regulatory procedures. A good distributor is capable of increasing market share and taking responsibility for the brand management when developing new markets and launching new products. For the manufacturer, there are also practical differences like language, exchange rates, local knowledge, trade connections, establishing price and managing grey imports or trade mark infringements.
Derek Edgar is the third generation of his family to be at the helm of one of the UK’s oldest firearm and ammunition distributors, Edgar Brothers (EB). Since Derek’s grandfather and great uncle established the business in 1947, EB now services thousands of private and public sector businesses including retailers and full-time shooting grounds as well as police, defence, MOD, outdoor and airsoft customers. The Cheshire-based distribution giant is split into four individual divisions, each with specialist teams.
According to Derek, EB is approached by numerous manufacturers every year, wanting EB to represent and distribute their products throughout the UK or Europe. “For us to consider working with a brand, they need to be an industry leader, or have the potential to become one, sharing mutual core values and objectives,” he explains. “We also actively approach brands that are important to our own portfolio and targets for growth.” Derek says that EB sees its role as a distributor as all-encompassing: “We are the face of the brand and therefore responsible for a wide mix of sales and marketing activity and initiatives. The core of this is ensuring great availability, good value, fi rst rate customer service and brand awareness.
“In the UK, there are roughly four channels offering distribution with differing levels of service and support. They range from the full-service type such as EB, moving down to those that simply shift boxes, to retailers that might dabble in distributing a single line for a brand. “As a brand grows, manufacturers can become frustrated by their limited impact on a marketplace, they may find they need to reevaluate the channel,” says Derek. “It is not unusual for a manufacturer to work their way through different channels until they find themselves represented by a larger wholesaler like ourselves, who provide a more established route to market.”
A lot of negotiations and introductions are done at trade shows abroad, in particular the SHOT show and IWA. An overseas manufacturer that does not understand the UK firearms and ammunition market can find they sign up with a distributor that is not set up to give the brand the level of service, or create the awareness, needed to achieve a product’s sales potential and market penetration. Often manufacturers do not identify with the main channels in their chosen new territory or understand the local market challenges.”
So if a distributor acts for competing brands, is it a cause for concern or does it add to their clout? “If you take the reloading category for example, EB distributes a broad portfolio of brands, some of which compete,” says Derek. “However, managing multiple brands means we can offer specialist knowledge and expertise to all our dealers. It’s easier to grow market share when you have multiple brands – they leverage each other as they all have their individual strengths and weaknesses, whether its innovation, production capacity, product depth or warranty support. In addition, retailers key into brands for different reasons, sometimes it’s just the convenience of one order, one invoice and one point of contact.”
According to Derek, the working relationship between manufacturer and distributor needs to be rock-solid. “We are lucky to consider our suppliers as close business partners, which enables them to keep a degree of control over their brand. The rapport has to be strong and professional despite us sometimes speaking different languages. “We now have a truly global brand portfolio. I spend a considerable amount of time abroad visiting manufacturers and suppliers, building relationships and managing long and complicated negotiations. This element of business is perhaps even more important outside the UK. For the Italians and Americans in particular it is paramount.”
There is no single recipe for the successful appointment and management of a distributor, but Derek mentions some ingredients that are worth considering. Firstly, the manufacturer does not sell to distributors – it sells through them, and they are a means of reaching target customers. For the channel to work effectively the manufacturer needs to understand each distributor’s business and core values. Every distributor services a window into the marketplace – this unique perspective stems from its total product line, its customer base and its capabilities as a business. If its window doesn’t match your marketplace-window, then the distributor cannot deliver your market-share objectives.
Derek points out that there is no written rule to say a brand can only appoint one distributor. “Many manufacturers like to hedge their bets when they enter a new territory and sign up to different would-be wholesalers,” he says. “Manufacturers beware – appointing a poor distributor can seriously damage brand value and integrity. Poor distributors can easily be identified by their lack of investment into stock and advertising – poor stock levels result in poor service, which in turn makes deliveries slow, stifling growth. “This is why EB prefers to work on an exclusive basis. We have found that the appointment of multiple distributors simply dilutes marketing activity and confuses the customer, especially where after-sales service and warranty support is concerned.”