Under mentioned are examples which are reflective of non justified approach towards distributors.
A. Sales for a brand have remained stagnant in an area with same demography credentials but the distributor is under constant pressure to deploy resources despite past experience of non increment in sales even after deployment of incremental resources. This is without any extra margins or resources allocation to the distributor by the principal brand.
B. If an existing distributor is contributing to (1%) if turnover of the brand and (50%) of his area is being chopped, then the new distributor is allotted only (30%) of brand’s turnover instead of (50%) and old distributors target is fixed at (.70%) of brands turnover, to justify the new distributors appointment so that from (1st ) month his performance can be justified.
C. In some markets with competing brands, while one brand expands in product developement, the other brand instead of keeping pace with competition in terms of infrastructure, keeps on adding distributors hence negatively affecting business viability of its distributors, but managing to retain its health by incremental security deposit collection and stock dumping..
D. Payment is made for recharge voucher by the distributor but slow moving S.I.M. cards are billed by the brand owner.
E. No price protection given on stocks which have stopped moving in the market and more when the stocks are billed to distributor on insistence of the brand owner.
F. Stock billed forcibly through third parties and then no liability accepted, in case of problems with the product citing helplessness since the stocks were not billed by the brand’s parent organization.
G. Most of schemes are rolled over E-Mail with the disclaimer clause that the organization does not bear any liability over the communication being made.
More over recently even E-Mail is being avoided and verbal is being preferred .
H. Distributor claims are being settled at Retailer price.
To realize the retailer price the distributor has to incurs costs towards sales, which the principal brand ignores deliberately and hence cost of selling is paid from the distributing entities own pocket.
I. Some brands roll out substandard products - they play around with market sentiments like promising life long warranty or product replacement, instead of repairs - sell their stock and vanish, leaving both the retailers and distributors into multiple problems.
J. Distributors of suburban market have suffered vastly, since they incurred huge costs for covering spread out markets located at distant locations and most of their resources were utilized in acquiring new customer but they continued to put efforts despite losses, in anticipation of future committed growth.
By the time it was the opportunity to reap the benefits of their hard work- most of the brands - in name of micro focuss, not only drastically curtailed their area but their margins too, hence loading double blow on them resulting in adverse financial impact for the distributors, who had blind faith in their principal organizations