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Useful Advices - Sales Partners - Agents, Distributors, Licensing and Franchises
When I'm speaking with clients who are looking for ways to expand their business the conversation often comes around to the possibilities of using agents, distributors, licensing arrangements or a franchise.
These sales partners have a lot to offer. But it's important to understand what each type of par
These sales partners have a lot to offer. But it's important to understand what each type of par
According to USFDA, a combination product is one composed of any combination of a drug and device; biological product and device; drug and biological product
tner means for your business (equally so for online enterprises).
The term 'franchise' has become a common way of describing a business relationship where the franchisor allows other people to sell their products or operate the same type of business under the same name, usually within a designated area.
The term 'franchise' has become a common way of describing a business relationship where the franchisor allows other people to sell their products or operate the same type of business under the same name, usually within a designated area.
; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.
Examples of combination products may in
Examples of combination products may in
But there is more to it than that. Much more. Legal obligations, management control, customer service and pricing are involved. And often 'franchise' is not the correct term for the relationship being offered.
Let's Have Some Definitions1 Agent: A representative for your company who will find buyers an
Let's Have Some Definitions1 Agent: A representative for your company who will find buyers an
lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.
d sell your products. Also called a broker. Paid by commission on sales achieved. Stock is not usually held by an agent.
Distributor: An enterprise whose business is to buy merchandise for resale, usually to retailers or other industrial and commercial users.
License: A formal permission or authority t
Distributor: An enterprise whose business is to buy merchandise for resale, usually to retailers or other industrial and commercial users.
License: A formal permission or authority t
here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe
do, or not to do, something which otherwise would be a legal wrong. Often used when dealing with merchandise or procedures protected by trademarks and patents.
Franchise: A privilege granted by one organisation (the franchisor) to another (the franchisee) to sell, produce or use its products. Different
Franchise: A privilege granted by one organisation (the franchisor) to another (the franchisee) to sell, produce or use its products. Different
d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.
Combination pro
Combination pro
types of franchises include:
A product franchise - which acts as an outlet for a particular product.
A system franchise (usually called a business format franchise) - which is authorised to conduct business according to a system developed by the franchisor.
A process or manufacture franchise - for whi
A product franchise - which acts as an outlet for a particular product.
A system franchise (usually called a business format franchise) - which is authorised to conduct business according to a system developed by the franchisor.
A process or manufacture franchise - for whi
ucts have become life saving products for the pharmaceutical companies who doesn’t have many innovative molecules in their product pipeline and have been inc
ch the franchisor supplies a critical ingredient or the know-how for a production process.
According to the Franchise Council of Australia the most common franchise method is the business format franchise, with 708 different systems being offered in Australia.
Typically each type of sales partner is su
According to the Franchise Council of Australia the most common franchise method is the business format franchise, with 708 different systems being offered in Australia.
Typically each type of sales partner is su
easingly used in the product life cycle management. Even the companies having product patents are trying to extend their product life cycle through the combi
ject to geographic restrictions of some kind, such as a pre-defined territory. Depending upon the situation this may be part of a metropolitan area, a state, or an entire country. Ideally the size of the territory should be based on sales and/or profitability benchmarks. This is sometimes tough to calcul
nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically
ate for new products and services.
At times the definitions may overlap. For example a 'manufacture franchise' may be the same as a 'license' for a manufacturer to produce certain items. The legal boundaries can be quite puzzling and expert assistance should always be sought.
Of particular importance i
At times the definitions may overlap. For example a 'manufacture franchise' may be the same as a 'license' for a manufacturer to produce certain items. The legal boundaries can be quite puzzling and expert assistance should always be sought.
Of particular importance i
and physically. They need to rightly judge the benefits of the combination products and they have to even look at the risks involved when combining the produ
the requirement of a business format franchise to offer comprehensive training, support, business management procedures and marketing programs. This all-inclusiveness is a hallmark of a true business format franchise.
It takes a long time to develop the systems and knowledge required to create a busine
It takes a long time to develop the systems and knowledge required to create a busine
ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi
s format franchise that conforms to the Franchising Code of Conduct and that will be of interest to serious franchisees.
If you find that your products do not require the intensity of support required by a business format franchise then the other sales partner options may be more suitable.
From a simpl
If you find that your products do not require the intensity of support required by a business format franchise then the other sales partner options may be more suitable.
From a simpl
ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.
Following aspects would a
Following aspects would a
e commission-based arrangement with an industry sales agent (or broker), to a more formalised licensing deal that may offer exclusive territory and advertising support, there are opportunities to get your partners working for you to increase your overall sales.
Don't Just Leave It To Your Partner Howev
Don't Just Leave It To Your Partner Howev
dd to the challenges in developing combination products:
Which markets to tap where the combination products can do fairly well?
Which combination prod
Which markets to tap where the combination products can do fairly well?
Which combination prod
r, it's not simply a case of thinking, "Let's sign a deal and let them worry about getting the sales". No matter which option you choose there will be ongoing communication and support required from you if you want your sales partner to get the best results.
And there are always potential pitfalls in an
And there are always potential pitfalls in an
cts are meaningful and rational?
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin
y relationship. Remember, the less committed your sales partner is to you, the lower your products or services will appear on their priority list.
So here are a few things to keep an eye on if you want to stay on track for success:
Agents - Stay in regular contact. Sell them on your products. Get them
So here are a few things to keep an eye on if you want to stay on track for success:
Agents - Stay in regular contact. Sell them on your products. Get them
tions increase the patient compliance?
What would be the developing cost?
How to tackle the risks encountered during combination product developmen
What would be the developing cost?
How to tackle the risks encountered during combination product developmen
xcited. Make sure your commission is competitive. Do you have an exclusive arrangement with them? Try to avoid agents who also represent competitive products, as they may have a conflict of interest.
Distributors - Be aware of how your products fit with their ranging policies. Train their sales team. He
Distributors - Be aware of how your products fit with their ranging policies. Train their sales team. He
t?
As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel
As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel
p them to promote your products by way of co-operative advertising and sales incentives. Stay on top of any seasonal or dated stock. You don't want your distributor overstocked with old merchandise (because they will think twice before ordering current stock!).
Licensees - Make sure your legal documenta
Licensees - Make sure your legal documenta
ping new procedures for reviewing their safety, efficacy and quality.
Professional from academic institutions, pharmaceutical industries, health care indust
Professional from academic institutions, pharmaceutical industries, health care indust
tion is sound. Gain a thorough understanding of your licensees business so you know how your product/service is being used. Are they committed to you for a period of time, number of units, or value of sales? Limit the license to their specific use so you are free to deal with other licensees.
Franchisee
Franchisee
y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products
- Use a franchise consultant to help develop your package. Remember your selection of new franchisees will be of paramount importance - people make the business! Have procedures to measure customer service levels and operating standards (use random checks, mystery shoppers, contests etc). Gain co-operat
.
As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de
As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de
ion and 'buy-in' from franchisees, rather than confrontation.
Sales Partners Online It's no news to online businesses that they should use productive partnerships to increase their chance of success. For example:
An affiliate program can be compared to a sales agent.
Syndicating content can be compar
Sales Partners Online It's no news to online businesses that they should use productive partnerships to increase their chance of success. For example:
An affiliate program can be compared to a sales agent.
Syndicating content can be compar
elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.
Companies that provide selfless information through particip
Companies that provide selfless information through particip
d to licensing (of the information).
Patented code/software is commonly used under license.
Always do your sums and make sure your choice of sales partner presents the best outcome for you. Look for commitment, synergy, innovation and growth potential in prospective partners - your future depends on it
Patented code/software is commonly used under license.
Always do your sums and make sure your choice of sales partner presents the best outcome for you. Look for commitment, synergy, innovation and growth potential in prospective partners - your future depends on it
tion in industry events and feedback to regulatory authorities would be able to face the challenges and will be successful in developing combination products
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