How to find and appoint distributors in India? The most common market entry strategy in India is to appoint local distributors in India. A master franchisor can effectively distribute and sell your products in the zone of interest.
With a population of over 1.41 billion people and a rapidly growing economy, India represents an attractive market opportunity for many businesses looking to expand their reach. However, finding the right distributor partner is important to succeed in the competitive Indian market. So, we have come up with a step-by-step guide that highlights how to find and appoint reliable distributors for your business in India.
Why Choose Distributors in India?
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At present, India has one of the fastest-growing GDPs globally and it will grow at over 8% for several years. It also has a large young population, with an average age of just 28-29 years. This young population represents a sizable consumer base willing to purchase new innovative products.
India’s business environment is also changing as the government implements new policies to make it simpler to do business. Furthermore, as smartphones and high-speed internet become more accessible, demand for both online and offline businesses grows.
All these macroeconomic factors make India an attractive destination for companies seeking growth.
Once you have decided to sell the products in the Indian market, a reliable distributor becomes the most important partner for your market success. These partners act as a bridge between your company and the Indian market, these partners help you expand your consumer base and handle tricky distribution routes.
The distributors act as supply chain intermediaries performing crucial roles like super stockists, logistics, warehousing, marketing, sales, and after-sales support in different regions.
Most companies entering India prefer selling via master distributor as they already have the local infrastructure and capabilities required to successfully sell your products. Even e-commerce giants like Amazon, Flipkart, Nykaa, Meesho, etc. heavily depend on national distributors in India like Cloudtail and WS Retail to reach customers across the country.
How to find Super Stockists or Master Distributor
Super stockists are key players in the distribution network who often purchase products directly from manufacturers and supply them to wholesalers and retailers across a big region or multiple regions.
Due to this nature, they are also called master distributor who operates at a higher level in the distribution hierarchy and provide additional services such as marketing support, inventory management, and product training to their downstream partners.
In simple terms, they handle big volumes and have extensive infrastructure and manpower to distribute products over a vast area.
Master Franchisor or distributor in India
This refers to a business appointed as a sole super distributorship or franchise for a brand across one or multiple states. Master distributors enjoy exclusive rights to distribute your full product range across defined territories.
On the other hand, there is a master franchisor who grants the rights to develop and manage a network of franchised outlets in a specific territory by selling franchise licenses to individual franchisees and providing them with support, training, and ongoing assistance in operating their businesses.
Best Practices to Find Reputable Distributors in India
Define Distributor Selection Criteria
Make a proper checklist of must-have capabilities like regional presence, warehouses, marketing bandwidth, transport convenience, operating cost, retailer networks, etc. This will help filter potential and reliable partners.
Get References
Ask industry colleagues who have worked with Indian distributors to recommend reliable options. Existing businesses in the Indian market may recommend reliable distributors in India based on their experience. Or you can services of company like selloverseas.com for field research.
Online distributor Directories
Platforms like Selloverseas.com allow searching for super stockists and super distributorship by product category and region. You can screen listed companies against your selection criteria and then contact them. It is one of the most economical online distributor directories to connect with distributors in India.
Visit Trade Events
Attending industry-specific trade events and exhibitions allows you to interact directly with distributors and analyze their interest in your offering.
Assess Company Credentials
Carefully evaluate potential distributors against criteria like years of experience, regional coverage, infrastructure, retailer network, financial stability, service quality, review, and rating.
Align with Business Goals
Choose distributors whose capabilities, resources, and business objectives align with your expansion and growth plans in India. To achieve this, you can arrange a meeting and review the plan.
So, after identifying potential options, invite proposals from shortlisted distributors in India to understand their commercial terms and capabilities in detail. Negotiate contracts favoring your business interests before finalizing ideal distributor partners.
Best Practices to Appoint Distributors in India
Sign Clear Distribution Agreements
Have legally enforceable contracts that describe business, financial, and operational terms such as territorial exclusivity, payment terms, minimum order quantities, sales targets, marketing expenses, reporting obligations, quality control criteria, and so on.
This ensures alignment between you and the distributor on business terms and leads to a more successful engagement.
Structure the Right Incentives
Provide fair profits and growth-related incentives to encourage distributors to offer their products aggressively. However, protect company interests through quantity or revenue caps. This helps secure partnerships with qualified distributors.
Provide Proactive Support
Supply marketing collateral, demo units, product training, etc. to enable you to effectively present your offering to distributors. Also, share best and proven practices from other regions to effectively promote your products to the target audience.
Monitor Progress Closely
The progress bar gives a clear picture of whether you should appoint this distributor or not. So, whenever you get the chance, review periodic sales reports, inventory levels, and retailer feedback. This way you can proactively address red flags like dead or excess stock, pricing issues, product packing, and quality complaints, etc.
Even if you have already appointed the distributor, this monitoring system is quite helpful for renewing the contract next time.
Plan Joint Initiatives
This demonstrates a collaborative approach, showing your commitment to supporting the distributor’s success through shared marketing efforts. This active engagement signals a long-term partnership mindset, increases the attractiveness of your brand proposition, and fosters mutual understanding and trust.
Invest in Relationships
Maintaining pro-active relationships with distributor management through frequent interactions. Ability to quickly resolve disputes affecting the business. All help in extending the distribution network and market reach.
Financial Stability
Make sure the master distributor you are going to appoint can handle the working capital and has a solid financial history. This indicates that the distributor can deal with business challenges effectively.
Final Words
India is challenging but the truth is that the market is highly rewarding if you gain consumer loyalty. Leveraging the expertise of distributors in India, can ease market entry into India and reap enormous potential.
It is recommended, to always find and appoint reliable distribution partners with due care. Provide proper support and incentives, closely monitor progress, and strengthen relationships. This makes your network stronger and bigger in India.
Implementing the tactics listed above may improve your chances of forging successful relationships and reaching your target market. For more inputs about your business category please feel free to schedule a video call. Wishing you happy selling in the rising dynamic Indian market.
By Aradhana Nayak (aradhananayak96@gmail.com) – A health care professional and writer on Social health and community drugs.
