10 common sales channels for improving your business revenue

By Indeed Editorial Team

Published 8 July 2022

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

Sales channels are a crucial part of many business models. They give businesses multiple ways to make sales, which increases their revenue potential. Knowing the available sales channels and their benefits can enable you to choose the right ones for your business. In this article, we explore various sales channels, highlighting their structure and benefits.

What are sales channels?

Sales channels are strategies a business uses for selling its products and services. Your business can sell a product directly, through a hired professional or in partnership with a third party. Utilising various sales channels allows you to generate more sales, revenue and brand awareness for your organisation. Here are some factors to consider when setting up sales channels:

  • Company size: Big companies can employ multiple sales channels and hire many sales professionals, but smaller companies may consider few cost-effective options.

  • Age of product: New products may require direct sales channels, while third-party sales channels can manage the sale of old products.

  • Existing strategies: Your existing sales strategy gives you enough information to help third-party professionals to manage your sales efficiently.

Related: What is inside sales? (With sales strategies and tips)

Examples of sales channels and their benefits

Below are some of the most common sales channels you can use and the benefits of each one of them:

1. Online Marketplaces

An online marketplace is an e-commerce platform where sellers and buyers get connected. These electronic marketplaces act as an online mall with many vendors putting their products there for sale to prospective buyers who frequently visit these platforms. The platform owner manages all transactions and dictates the terms and conditions for transacting.

Benefits:

  • It reduces your marketing costs.

  • It provides your company with the opportunity to market your products internationally.

  • It allows your company to operate every hour of the day, seven days a week.

  • It creates a level of trust between your brand and customers.

  • It exposes your product to a wide range of customers.

2. Distributors

A distributor is a person or a business entity that buys products and sells them directly to customers. They may also provide services like technical support, warranty and delivery. They can help you reach their existing client base, using their contacts and experience in local business practices.

Benefits:

  • They offer cost-effective customer services for your products.

  • They offer expertise and experience in the sales and marketing of your product.

  • They provide additional marketing services like setting up signage, training retailers' personnel and launching in-store promotions.

  • They provide the facilities and personnel to expand the reach of your products to new locations.

  • The services they offer reduce your marketing and distribution costs.

3. Overseas Distributors

An overseas distributor is a person or company that buys your product and sells it in the local market of another country. With their expertise and experience in the culture and practice of a local market overseas, they can introduce your product to customers in another country. Choosing the right overseas distributor for your product requires careful consideration.

Benefits:

  • They allow you to access international markets without logistics problems and many foreign trade-related risks.

  • They usually handle the shipment of products with the customs procedures and paperwork, which accompanies it.

  • They can help you avoid currency-related risks.

  • With an established reputation and contact list, they can quickly introduce your brand to the right market.

  • They provide warehousing and inventory control for your product in an overseas market.

4. Affiliate Marketing

Affiliate marketing is an advertising model where you pay affiliates to generate leads for your products and services. Online-based businesses give affiliates a unique link that tracks traffic each affiliate directs to the company's site. The affiliate gets a certain percentage of sales made through those links.

Benefits:

  • It helps you avoid the cost and burden of organising an advertising team

  • It reduces the ongoing cost of marketing and allows you to only pay when sales are complete.

  • It's perfect for a tight budget, allowing a slight risk of loss as you only pay for actual conversion.

  • It's cost-effective and flexible, allowing you to regulate the size of your affiliate program.

  • It can lead to a much higher return on investment than most marketing strategies.

Related: The different types of commission structure explained

5. Outsourced Sales

Instead of hiring an entire team as permanent staff, you can outsource your sales to a sales or marketing company. These companies have sales professionals and specialise in providing marketing services to other companies. They control the sales flow, including the management of advertising campaigns.

Benefits:

  • They reduce the cost and burden of hiring sales professionals and running a marketing department.

  • They provide you with experience and expertise in producing high sales volume.

  • They ensure efficiency and productivity.

  • With outsourced sales, you have flexibility in quickly controlling the scale of sales and marketing.

  • They can provide you with periodic reports that help you monitor their progress and activities.

  • With their service, you can avoid the risk of hiring the wrong sales representative.

Related: How to write a sales manager CV (with template and example)

6. Value-Added Resellers

A value-added reseller is a company that improves your products by adding valuable features or services before reselling those products. After adding value to third-party products, these resellers can resell the enhanced products at a higher price. Computer retailers and service companies, furniture stores and automobile dealerships are examples of value-added resellers.

Benefits:

  • They bring a professional background and expertise that can improve the market for your product.

  • They package your product with supplementary products and services to make it more valuable to customers.

  • They can provide the best customer support, including guides and tutorials for using your product.

  • They save your customers time and money with the additional products and services.

  • They offer a viable option to improve your product portfolio and expand your business.

7. Sales Agents

A sales agent is a professional you hire to sell your products or services and act as a spokesperson for your brand. They often operate independently and earn a commission on every sale they complete. Some sales agents may also work for sales agencies that offer their staff on contract to other companies.

Benefits:

  • They often specialise in a particular market and can bring new customers to your business

  • With their contacts and relationship, they help you reduce the time it takes to generate new leads.

  • They provide you with a pre-defined market without the burden of cold calling and prospecting new customers.

  • Their service cost may cost less than running an internal sales department.

  • As you pay them based on performance, they can generate a high return on investment.

Related: How to become an advertising sales agent (plus salary info)

8. Catalogue Marketing

Catalogue marketing is a sales method where businesses group many products in a printed piece or an online store, aiming to sell at least one product to the recipient. Consumers purchase directly from the catalogue sender by phone, return mail or online using the details in the catalogue. Some catalogue marketers act as intermediaries between consumers and manufacturers, while businesses with many products can create their own catalogues.

Benefits:

  • It increases your brand visibility and awareness

  • Coupled with an online marketing campaign, it can help maximise profit with the campaign.

  • It allows you to create versions that appeal to the consumption habits of your customers.

  • It can generate traffic for your website and ease the ordering process for your customers.

  • It allows you to express your brand voice and style through words and images.

  • It can generate a high return on investment as a cost-effective marketing tool.

9. Physical Stores

A physical store is a retail environment with physical space to display and sell products. It can be a free-standing facility, a renter in a shopping centre or mall or linked to outlets like public attractions, museums or residences. Physical store owners hire retail sales employees who educate and assist shoppers and keep the store's appearance and inventory.

Benefits:

  • They offer effective customer service to help shoppers select the right products.

  • Your customers are less confused and dissatisfied with their purchase, as they can physically examine it.

  • It allows your brand to promote its physical presence among your customers.

  • It allows your customers to see and touch your products before purchase, reducing consumer doubts.

  • It reduces the time and cost of returning products.

Related: What is a sales job? (With examples of common sales roles)

10. E-commerce stores

An e-commerce store is an online platform for buying and selling goods and services. The seller manages the online store, displaying their goods and services and generating traffic through various Internet marketing strategies. It can substitute physical stores, though some businesses choose to keep both.

Benefits:

  • It eliminates the cost of paying rent, hiring sales representatives and paying other bills that come with maintaining a physical store.

  • It allows your business to operate from anywhere without the constraint of time and location.

  • You can closely monitor the success of any product and quickly increase the stock of successful ones.

  • You don't need a lot of time to run an online store, as most of its functions run automatically.

  • It gives your customers the easy option of buying your products from the comfort of their homes.

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