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14-Dec-2015  Düsseldorf / Germany

Henkel builds strong partnerships with traditional shopkeepers

Spotlight on traditional retail

From „changarro“ in Mexico to „bakala“ in Saudi Arabia, to „bakkal“ in Turkey, there is a wide variety of local names for traditional trade in the emerging markets. Laundry & Home Care is now setting a clear focus on this important sales channel.

Strong partnerships with traditional retailers in Mexico

Strong partnerships with traditional retailers in Mexico means the shelves are well-filled with Henkel products

There are 20 million traditional traders all over the globe – from street stalls to neighborhood “mom and pop” stores. Today, they account for around 50 percent of Henkel’s Laundry & Home Care sales in the emerging markets. “Traditional trade offers significant potential for expanding our business in the emerging markets of Middle East/Africa, Eastern Europe and Latin America,” said Christoph Till, Corporate Director International Sales Laundry & Home Care. “In order to make optimal use of the major growth opportunities in these markets, we’re pursuing a regionally adapted business strategy.”

In order to further develop the sales and marketing approach, an international and cross-functional team – from marketing and sales to finance and logistics – works closely together. An important aspect is extensive market research of shoppers’ and shopkeepers’ needs. Beyond outstanding product performance, brand loyalty is a decisive factor in the success of products, which may be placed behind the owners in some stores, or may not even be visible at all. This means that store owners are also brand ambassadors and make their own decisions about their often limited range of products on offer. With a flexible sales model based on external distributors, the partnerships with individual shopkeepers should be strengthened in the long term. “Traditional trade is a highly complex sales channel in the emerging markets: varying requirements, small-scale deliveriesand widely scattered stores with little storage space present Marketing and Sales with major challenges,” Till said.