BREAKING DOWN THE BARRIERS TO DIVERSIFICATION PART ONE

Many dealers have diversified their product range over the past couple of years, but others have reservations - or are unaware of how easy it can be to diversify

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hroughout the past two years of the COVID-19 pandemic, many dealers have successfully diversified their product range – and these newbies have often become standard lines since. Yet some dealers are still hesitant to move away from the traditional office products market – and this means they could be missing out on important new sources of revenue.

Steve Plaistowe, OP channel manager at Spectrum Industrial, says that the reality of diversification can be simple. “The OP channel can continue to be a ‘master’ of office supplies,” he says. “’Supplies’ are just products and services being sent into office environments. Offices are often attached to warehouses and manufacturing units - which opens up many more opportunities for the office products channel to provide a wider portfolio of ‘supplies’ into that environment, not just traditional stationery. ‘Diversification’ is as simple as providing a product that their customer wants.”

For instance, dealers can easily diversify into site maintenance, Steve says. “The facilities manager they are talking to will already be buying-in products to maintain their site, such as hardware and ironmongery, tools and much more - most of the opportunities available to office products suppliers to diversify can just be a simple add-on to what they are already providing.

“It doesn’t have to be complicated. New product areas just require little investment from the dealer. They don’t have to stock the product, just add it to their website and promote it. There are many brands/manufacturers that can actually distribute the product for the dealer, so they don’t even have to rely on the OP channel wholesalers, they can work with the brand/manufacturer direct.”

KNOWLEDGE IS POWER Steph Gentle, marketing manager at Beaverswood, adds that it can sometimes be a lack of knowledge that

stops dealers from diversifying into other product areas or workplaces. One perceived barrier is not understanding the technicalities of new products. “One thing we stress about Beaverwood products is that you don’t need to have any technical knowledge; you just need to understand the basics of a warehouse” says Steph.

“New product lines can mean talking to new decisionmakers or stepping into the warehouse, storage facility, manufacturing plant or logistics centre. It’s a different part of the workplace than they are used to and this can, in itself, present a barrier as it is an unknown.”

In fact, there are few real barriers to adding new product lines. Many, such as Beaverswood’s products, are on FusionPlus - which means they can be added to a dealer’s website overnight and be instantly saleable afterwards. The barriers to adding these products are so insignificant, Steph says, that manufacturers should be addressing this ‘unknown’ factor to encourage dealers to make the leap into new product lines.

“If the dealer thinks they are opening a pandora’s box by having new products that customers might be asking them about, and that this could be uncomfortable, it is making sure all of the resources and training are available and that manufacturers are supporting resellers to diversify by presenting a really simple to sell range.

“There is a stigma among some about the perceived effort needed to open up new categories, and that it can take months to get new categories off the ground. For instance, when jansan was initially launched, the ranges were seen as niche, and some companies thought they were slow burners. There are those that think it is a lot of effort, money, time and resource to invest in a new category that could be a dead horse.

To lower that barrier, it’s about presenting a range of products that can be easily learnt, are easy to sell, and fit the typical model of the office product reseller in terms of how they buy and sell.”

Steph stresses that it’s key for manufacturers to provide support to dealers moving into new product areas. “If you are asking somebody to step into a whole new range you need all the sales tools to be able to market and sell that range,” she says. “That can be marketing collateral, sales support, product training and education. Having a strong reseller pack can help overcome any barriers to selling for a dealer.”

New product ranges also need to be easy to sell online – especially as the B2B market is growing so rapidly, Steph says. “Products need to be well-

‘Diversification’ is as simple as providing a product that their customer wants

merchandised for online selling – it is about having the right photography, product descriptions, videos and reviews to help a product sell online.”

PROVIDING A COMPLETE SOLUTION Steve Carter, managing director of Advantia, agrees that for dealers to make a success of diversifying, they need to be given the right support.

“If you go to dealers and say, ‘We’ve just done a deal with a jansan company, here are the products. We’ll get all the data set up, pricing etc – go fill your boots’ you’ll turn the dealer off because they know nothing about that product sector and won’t know how to sell those products effectively.”

Steve points out that Advantia, and other dealer groups, will give dealers all the information they need before a new product range goes live. “For us, it’s not just about giving dealers the supply, but a complete solution - so that they are confident about what they are talking about and know that, in the background, there is help available for any related questions they may have,” he says.

“When we talk to a supplier in a new product area we do all the background work with them and put together a solution, rather than just a price list. We will also put the supplier in front of the dealers so they can educate them about the market - how to sell the products, where to sell them and what questions to ask. Dealers can also ask the supplier questions.

“We also put our marketing team and the suppliers’ marketing team together to come up with supporting documentation and promotional materials. We also ensure the supplier will be on hand to help dealers with further on-site training if needed, or to answer any questions when they are out selling.”

This means that everything is in place for the dealer to go out and sell the range before it goes live on their websites.

“The end-user now expects a dealer to be more than just somewhere where you get pens and paper; it needs to be a ‘one stop shop’. We have had to diversify to all areas, from furniture to workwear and jansan, shredding and print to technology and MPS, compatibles and more,” says Steve.

“If you can diversify, and sell your customers a complete package, it makes it easier if things go wrong in one particular area as you have others to fall back on and maintain profitability.”

It’s not just about giving dealers the supply, but a complete solution