To provide India with optimal sales is a challenge of a special kind. A commentary by the management consultancy Dr. Wamser + Batra GmbH, which specialises in India.
Over 1.2 billion consumers live - widely scattered - in the multi-ethnic state on the Ganges. Only 15 percent of the total population lives in the more than thirty cities with more than one million inhabitants - including Delhi and Mumbai, two of the most populous metropolitan areas in the world. The rest is spread over a geographical area of about 3,200 kilometres from north to south and 3,000 kilometres from east to west. India is the seventh largest country in the world in terms of area.
In the B2B sector, product marketing is (at least theoretically) analogous to other markets. Marketing and sales can be done by well-trained personnel from (in the case of India usually) several sales offices. Products are either sold directly to the end consumer or to specialized distributors.
Most German companies use (at least in the first step) Indian distributors or sales representatives to serve this huge market. Due to the size and complexity of the market, companies are often forced to work with different partners for heterogeneous markets (regions, target groups, segments) - a suboptimal situation. But finding a single suitable partner who offers optimal access and adequate market development throughout India is rather the exception to the rule.
Disadvantages of working with distribution partners
Sooner or later, the disadvantages of a sales partnership with external Indian sales representatives or agents become obvious. Mike D. Batra, Managing Director and Head of Market Services, responsible for sales development and optimization at Dr. Wamser + Batra GmbH, summarizes these as follows: "no direct access to the customer, lack of transparency in business conduct, poorly trained sales & service personnel, high fluctuation, no systematic market cultivation, no control of local activities, lack of focus, little influence on the marketing strategy and own brand in India".
These symptoms are in the nature of cooperation with agencies and have per se nothing to do with "the Indians" per se. However, these "expected" disadvantages have a particularly strong effect in India: Indian distributors, after all, know exactly how to deny you full transparency about your market and business opportunities, and how to "tailor" relevant information to suit their own goals. For this purpose, please refer to the article "The Eleven Commandments for India" quoting, "Truth in India means: flexibly adapting facts to the respective situation".
The cooperation with and management of several sales partners is correspondingly tedious. And you would rather avoid conflict management with and between your Indian representatives altogether. If the cooperation breaks down, you will normally be back at the very beginning of your efforts.
The own distribution network as a strategic competitive advantage
For reasons of sustainable and targeted market development, you should ideally establish your own sales organization in India. The goal is to be able to serve your customers directly - without middlemen - and to build long-term relationships with your company/brand/products. You alone determine the product and communication policy and can ensure that all processes run the way you want them to: starting with marketing, through the sales process to after-sales & service.
You can thus better control all relevant processes and have full transparency in your sales activities and the positioning of your brand in the Indian market. "Instead of quick respect successes and harvesting the "low-hanging fruits" from the personal network of the sales representative, it is only through your own sales network that you are able to work the market strategically and in the long term - which is not always the strength of Indian dealers," emphasizes Mike D. Batra.
If sales is a core process for your company (which can be assumed if you have read this article up to this point), you should be in control of this process yourself, especially in India - even if this seems more expensive in the short term. Because if you (have to) rely on others in India, you may be abandoned yourself.
WB Market Solutions® enables the sustainable successful market entry and strategic sales development for German and European companies in India. Existing sales strategies and structures are also put to the test and optimized if necessary.
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