1. 1. Motivating Channel Members
3.1 Distributor Advisory Councils
Channel Management : Overview
Managing channels is one of the most important
dimensions of businesses across the world for improving
their value in the market. Customers are constantly on the
look out for convenience and service, when purchasing
goods. Effective channel management helps companies
decrease costs and reach potential customers profitably.
Effective channel management involves proper recruitment
of channel members. Recruiting channel members should
be a continuous process. In the recruitment process,
screening involves elimination of applicants who do not
match the criteria set for the position. After effective
screening, the company has to make the final selection
based on some criteria. These criteria can be divided into
sales factors, product factors, experience factors,
administrative factors and risk factors.
After selecting channel members, they have to be
constantly evaluated and based on their performance, the
company will either retain existing channel members or try
to forge relationships with new channel members.
Channel members can be evaluated by using parameters like sales quota attainment,
average inventory levels, proper management of inventory, channel members'cooperation
in promotional and training programmes, etc. The distribution requirements of a company
will keep changing according to changes in the product life cycle. Modifying channels
accordingly is essential for the success of the organization. However, care should be taken
in dealing with channel members for proper channel management. Conflict management
among channel members is another important activity for the management of the
organization.
Guidelines to Establishing a
Distributor Advisory Council
Who knows better than your customers or your distributors where your operations can be improved?
Today, progressive firms increasingly rely on advisory councils to suggest improvements,
recommend action and offer feedback on programs and policies. In fact, many companies feel that
this form of communication is vital to the continuous improvement of their business operations.
The "Guidelines to Establishing a Distributor Advisory Council" will answer the most common
questions that companies have concerning the purpose for an advisory council and ways to ensure
Group 3

2. that the meetings are productive. While size, frequency and meeting length may vary, all successful
councils have one thing in common—a commitment from top management to listen. Whether you
are a manufacturer who wants to improve your distribution channels or a distributor who wants to
learn from your customers, an advisory council can point the way. But remember, only establish the
council if you want their input and will act on it. The time and money you invest will pay off in real
dividends for your company.
These guidelines were developed by the IDA & ASMMA Partnership Enhancement Committee and
endorsed by the PTDA Industry Relations Committee.