Routes to market
Your route to market is how you sell your product and how you plan your sales.
It's one of the most important things to get right -
If you don't sell the way your customers want, they won't buy your product.
This guide introduces you to the different routes to market.
For further information on successfully marketing your business, take a look at our marketing advice section.
1. What to consider before you choose
Your route to market needs to be suited to your customers - to how they shop, where they shop and where they'll see your product. It also needs to match your budget and your ability to distribute your product. If your route requires product delivery, for example, look at how much it'll cost as well as if you can realistically manage the speed and reliability you want to promise customers - and the logistics. Consider how and where your customers shop and keep in mind your budget and your ability to manage your chosen route.
2. Direct sales
Direct selling is where you sell your product straight to the customer, without a middle man - through your own website, door-to-door, using direct marketing or advertising, or through your own shop. It's good for when you need to explain complex products to consumers. It lets you use your selling skills, build a personal relationship with the customer and get direct feedback. But it requires more staff and higher travel costs.
It's usually more suited to complex products and packages and making personal contact with an important customer for the first time.
3. Selling wholesale
You sell your product to a retailer, wholesaler or reseller, who then sells it on to consumers. You usually sell a fairly large amount of product at a lower rate than if you were selling direct. It's a cost-effective way to shift lots of product in one go, and it doesn't use up the resources you need approaching customers individually yourself. It's often more straightforward to manage a business with one wholesaler than lots of individual consumers.
Profit margins are often reduced, though, and it can be a complicated process setting a price and finding the right wholesaler. Selling wholesale is the preferred route to market for selling lower value items, shifting a lot of product quickly and selling to businesses who prefer to deal with large or established suppliers.
4. Distance sales
This is where you sell to customers remotely - usually through a website, telesales or direct mail such as catalogues and brochures. It's much cheaper than renting retail space and you don't have to travel to customers, saving time and money. Cons are that you can't properly demonstrate your product - some people prefer to feel and try out a product before they purchase - and trust can be more difficult to establish online. It's a good selling method for repeat orders, reaching internet markets and selling to customers who are further away or abroad, or for products and services that don't need to be touched and tried out to be trusted. Using this method is much cheaper than most other sales routes, but harder to build trust in both product and business.
5. Online sales
There are different ways to sell your product online - such as through your own website, by using affiliate marketing, through an auction site such as eBay, through a retailer's website, through online adverts, or using direct emailing to a customer database.
Selling online saves on costs - no shop premises or staff needed and orders can be placed automatically. It also means that your business can be open 24/7, that it may reach a wider customer base, and that you can collect data from people placing orders.
However, the internet is often seen as less personal and less trustworthy, you can't demonstrate the product, and it can be difficult to get traffic to come to your site. To make the most of online, you need a really reliable and easy-to-use website.
6. Combining channels
This does exactly what it says on the tin - you use more than one route to market. This can give you a greater chance of reaching your audience, and you can work out which channel is most effective and adjust your sales strategy accordingly.
Be aware, though, that you need to keep on top of each channel - prices must be kept consistent if there's a chance someone's going to see more than one channel. You also need to make sure you don't step on any of your agents' toes by using another channel on top of theirs.