Retail counter or project sale: where a building materials maker should put its effort

A building materials maker gets one route to work properly at a time, so the job is to pick which. Do it from your own invoices, not from opinion. The scorecard below has six lines. Fill it from last year's sales book and the answer can be clearer than the debate. If your product is picked off a dealer's shelf by a mistri, the counter leads. If an engineer writes it into the drawings, projects lead. Running both with one process weakens both.

Fill the scorecard first

Sort last year's invoices into counter, project and other. Then fill one column for each route. Where you must guess, mark it as a guess.

The last line catches the risk the others miss. If one project is most of the route, one cancellation can undo the year. A counter route with fifty small buyers does not have that weakness, but it has a different one, which is dealers who drift to a rival with a better margin.

Then walk the branches

The scorecard says what happened. These questions say what to do about it.

Does an engineer or consultant name your product in the specification? If yes, projects deserve a person, because a counter salesperson will not reach that office. If no, and buyers choose on the day at a shop, stay with the counter.

Can you wait for money? Project bills are tied to certified work and can arrive late. If one delayed payment would stop your next raw material purchase, the project route is not yet affordable, however good the order looks.

Can the plant supply to a site schedule? A project buyer wants consistent batches on dates. A counter buyer will take what is available this week. A plant that runs short of stock every month suits the counter better.

Do you already have dealers who are paid on time? If so, protect them. A project rate that undercuts the dealer will leak within days, and the dealer's goodwill is worth more than one order.

If three or more answers point the same way, that is your base. If they split evenly, take the route that fits your cash.

A made-up case: AAC blocks in Jhansi

Take an AAC block maker in Jhansi. Every figure and name here is invented to show the method. Counter sales went through five dealers to small builders and house owners, project sales to two developers. The scorecard showed project orders were fewer, larger and slow to pay, while one developer made up most of the project line. The counter line showed steady orders. The margin was thin, because a rival block plant two towns away kept cutting dealer prices.

Project work looked heavy partly because the owner chased every enquiry personally, and the developer behind most of the project line had paid two bills late, which tied up cash. The owner's instinct was to chase more projects. The scorecard pointed the other way.

The decision was to keep the counter as the base. A named salesperson would see the five dealers on a round the owner set, and answer dealer enquiries the same day. Developer enquiries went to the owner at a price above the dealer rate, and each dealer was offered the supply role on any job in the dealer's area where the developer allowed it. That last rule mattered. A developer quoted less than the dealer pays would otherwise buy through that dealer and reveal the rate.

The partial result: dealer complaints about a cheaper project price stopped, but the owner still lost one developer to the rival plant, and a quarter of a salesperson's pay (say ₹12,000 a month, invented) now went on a route with thin margin. Projects stayed a side line until cash allowed a second hire.

When a large order arrives before you have chosen

Take it, but treat it as a one-off. Give it its own price sheet, its own delivery plan and a named owner, so the counter salesperson is not pulled off the dealers. Afterwards, note the time and cash it cost. If a second and third such order follow, that is your evidence for a project person, and not before.

When a dealer asks you to quote the dealer's customer's project, send the enquiry back with a supply price. The dealer keeps the relationship and your effort stays small. Our post on how a contractor or builder chooses a supplier shows what the smaller project buyer looks for, and winning orders from housing projects and developers walks through the committee. For the counter side, see how to find and keep the small contractors who buy every month.

Who may sell to whom

Fix three prices before you answer any enquiry: the dealer's buying rate, the project floor, and a rule for a project inside a dealer's area. Without the third, dealers learn the project price by accident, and that is how channel fights begin. The wider question of dealer or direct is in should a manufacturer sell through dealers or directly, and the terms for each are in dealer, distributor, stockist or reseller.

An afternoon with the invoice book

Take last year's sales book, a pencil and the scorecard, and sort the invoices into counter and project before anything else. The sorting is dull work, but it replaces a debate with six numbers. Fix the project floor price that evening, so the first developer enquiry does not set it for you. The trade is covered on our construction materials page, and if you want a second view on which route to lead with, tell us what you need.