Method of Sales
Describe available distribution channels and how you plan to use them.
Many entrepreneurs fail to give adequate thought to a method of sales.
How you get the products to the end user - your method
of distribution and sales - is one of the most important elements
of your plan. In this section you demonstrate the ability and
knowledge to get your products into the hands of your target
customers.
You must also elucidate your plan for reaching your
distribution channels. Will you be selling directly to your
customers? Will you be using sales representatives, distributors,
or brokers? Do you plan to have a direct sales force in place?
See the list of definitions for some help in determining what
method of sales to use. Will you use a "ground service"? Will you use a next-day delivery
service like Federal Express? Parcel post? A trucking company? Make sure
to include these costs when you calculate your financials later in the
plan.
Tips
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Don't make the mistake of confusing sales with marketing.
Sales focuses on how you get your products into the hands of
your customers. Marketing is concerned with how you educate
your potential customers about your product.
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If you're using an outside or indirect sales force - like
sales reps or distributors - be sure to describe the
companies that will be carrying your products. What are the
benefits of using these specific firms? What unique talents
do they bring to the table?
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Many small businesses assume that a sales effort can be set
up with minimal timing, effort and expense. This is not the
case. It can take as long as a year for a sales person to
become acquainted with a product and territory. Even if you
use sales reps who are intimate with a territory and market,
expect there to be ramp-up time.
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Don't assume a distribution network will give your products
or services equal sales time. You may need to create an incentive structure that will encourage your network to push your products or services.
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> Learn how OPENSM from American Express can help your business. |
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