Is there anything more disconnected from reality these days than the expectations from winery owners of what a wine distributor can do for your brand? Same goes for spirits brand owners.
“The past” is a terrible place to live these days if you are serious about selling a lot of wine or spirits. Especially when it comes to working with wine distributors. Here is how you can tell if you are doing it:
Let me be crystal clear about one thing: the days of wine distributors being able to build new distribution for you are OVER. Period, end of sentence.
There are just WAY TOO MANY wine brands out there and way too few distributors!
It’s the same story for tiny, startup distributors, medium-sized distributors, large distributors and mega-distributors. The ratio of brands to sell and people to sell them is horribly out of whack and it is only getting worse by the day!
Whether you are ready to accept it or not, this sets up a new reality: the burden of building sales & distribution has shifted from the distributors to the manufacturers.
When I rack my brain trying to understand why so few brand owners have fully embraced this reality, the only thing I can think of is that the distributors’ inability to do what they used to be able to do is a fairly “recent” phenomenon.
And by “recent” I mean just the last 5-6 years or so.
It’s a great question, isn’t it? Since the repeal of prohibition, the 3-tier playbook has been the same:
This playbook worked just fine for eighty years! So what the heck happened? THIS is what happened:
When you stop to consider this graphic was created by Silicon Valley Bank back in 2015, this was only the BEGINNING of the dramatic growth in the number of brands on the market.
For spirits, the situation is equally as grim:
Source: American Distilling Institute
(Distributors won’t come out and say it.)
Of all the blog posts I’ve ever written, 5 Things Distributors Won’t Say to Your Face is by far the most widely read and shared one. It was viewed over 9,500 times, received 220 reactions, 53 comments, and was shared 18 times.
It is almost as if this never occurred to people until it was pointed out. It’s not that distributors won’t do what they used to do, it’s that they CAN’T and it's up to you to figure this out for yourself.
If it’s important to you, you’ll have to do it yourself.
I can say this with confidence because a quick perusal of a typical job ad is full of “crazy” descriptions of what the job requires. Consider these disconnected-from-reality bullet points taken from actual job postings:
Can you tell that these companies have completely missed the memo?
Can you see how off base this way of thinking and operating is?
It is essential that you let go of any notion that you can somehow get your distributor(s) to perform at a higher level.
The truth is no amount of training, education or “accountability” is going to change the fact that distributors large, medium and small are all completely overwhelmed with the number of brands they have in their portfolios.
They say that in war, when a new soldier is dropped into the field of duty, they are so terrified of dying they become “frozen” and are not very effective as soldiers.
But, there comes a point that they realize they most likely will never return home alive. Once they’ve accepted their new reality (that they are going home in a box), the fear leaves them and they are now free to fight with great ferocity and courage.
I think parallels can be drawn in the wine & spirits business today. Due to the intense and unprecedented level of competition, “death” is the most likely outcome for many brands.
But for those who accept the new reality and make the necessary adjustments, nothing but victory awaits!
Since the burden of building new distribution and sales has shifted from the distributor to the supplier, most brand owners need to take a hard look at the way they deploy their sales team.
What you need now are fewer people managing distributors and far more calling on chains and key accounts. This article I wrote a few years ago about how to build a modern winery sales team will get you off to a great start.
You need to embrace a new mantra: “If it’s important to us, we’ll have to do it ourselves.”
Go ahead and get all you can out of your distributors but at the end of the day, you need to take responsibility for your own outcomes on the objectives that are a high priority for you.
Here are a few examples of objectives you will want to handle on your own:
If you want to truly shrink the learning curve on these topics, you should strongly consider joining our group coaching program, Wine Sales Stimulator, where you can get EVERYTHING you need all in one place!
The key to dramatically accelerating your sales is to NARROW the focus on time, investment and energy to ONLY the most attractive and responsive accounts.
I have several great resources that will help you create your own list of target accounts.
The 80/20 Rule is REAL and you ignore it at your peril. Thanks to the internet and amazing assessment tools that are part of Yelp, it is easier than ever to identify the accounts capable of generating the move volume.
When you create these lists, keep in mind that they are intended to be used by your own sales team. You don’t just hand them over to the distributors and expect them to do anything with them. This is kind of the whole point of this article. They CAN’T do what they used to be able to do. There are only 3 things you can expect from your distributors and this is not one of them.
Once you’ve assembled the list of “80/20 Accounts,” you would be wise to learn HOW to sell to those key accounts.
There are really only two types of sales activities when it comes to selling more wine or spirits:
And the key to “scaling” your sales is by leveraging technology.
Any sales activity that requires the physical presence of a human being cannot be scaled. These would include things like:
There is nothing wrong with the activities listed above. The problem is they cannot be scaled.
Here is a list of things that CAN be scaled:
Even a small investment in one or more of these strategies can make a BIG difference in your sales success. And the best part is there is no need to add headcount to your payroll to do them!
One of the best things about leveraging technology in your sales process is even the tiniest winery or distillery can use it to box well above their weight class.
Take email for example. With the right email marketing strategy in place, a small wine or spirits brand can reach a passionate consumer’s email inbox just as easily (and at the same price) as a giant, global brand. This is amazing when you think about it!
When you combine the fact that anyone can leverage technology with the ability to scale it up, investing in technology (and the know-how to use it) becomes a high return, low cost way to level the playing field!
Make a commitment to master one or more of the six strategies listed above BEFORE you add any more headcount to your payroll.
What if there was ONE PLACE you could go to learn more about ALL of the things discussed in this article? What if most of the tutorials were absolutely free?
Well, there really is such a place and we invite you to check it out at your convenience. It’s called the Wine Sales Stimulator group. Don’t let the term “wine” throw you as fully half our members are non-wine producers (mead, spirits, etc).