And their value proposition, as even they realized later, was pretty unclear.

If you think about it, we didn't talk about how much to charge.

VARs might do video editing systems that are turnkey.

So let's take a look at a direct sales example.

This is just the gross profit.

In a physical channel, a direct sales force are sales people that work for you directly and typically sell directly to the end user.

In other words, how are we going to make money?

So, you're selling costs were embedded here, this was the commission or direct sales costs or whatever you were paying your direct sales people and you made 37 selling directly.

Sell, sell, sell.

Web Telesales, almost no value added. Retail maybe adds a little support.

So for some industries, distributors play a pivotal role in the distribution of the product.

By the way, the how many is a classic question, and the answer is it depends.

Oh, I'm in the selling game.

But this time, we have resellers and the resellers don't work for us.

For this quiz to check your understanding of the channel diagrams, match the appropriate channel diagram to the corresponding channel and put the appropriate number in the correct box.

How many can you distribution channel actually sell?

We should be charging for it from day 1, or Wait a minute.

And it's important to think about how the money's flowing.

This is the boat that that lady was paddling around in, and this artisan makes the boat and the paddles and sells directly to the people who need the boat and the paddles.

We first started distributing and making physical products cars, food, utilities, etc. and we distributed them through direct sales force that is people you shook hands with, look in the eye and met.

The second area of discrimination is advertising and marketing.

Cut out the middleman. Run our own game.

They provide distribution and accounting, bill collection, etc.

After studies tomorrow, there will be a sale.

But this is, of course, an optimistic scenario. Let's think of other scenarios.

Some of them might actually add some service or support but they're essentially an extension of the distribution channel, and they talk to the end users.

If you think about this, this entire conversation we've had was how to get the basic data so you can put together a revenue model that's based on fact rather than fiction.

His job is to promote sales.

Sold

PHOTO RELEASE

What do you sell?

And distributors might sell to dealers. Most dealers are just simply storefronts.

Tom's work is selling second hand cars.

We call it a select opportunity .

Well they are.

Best Buy, the consumer electronics company, gets all its employees the cleaners, the shop assistants, the people in the back office, not just its forecasting team to place bets, yes bets, on things like whether or not a product is going to sell well before Christmas, on whether customers' new ideas are going to be or should be taken on by the company, on whether a project will come in on time.

You just need to ask what are core services that are part of your value proposition.

like you could in the enterprise, and so you want to get out and reach them virtually, but the number you want to get to really is an order of magnitude different than if you were doing B to B direct sales.

Everyone has gotten their tickets, or maybe they got sold out.

He's like, you know what, we have to match his prices.

My dad sells tractors.

I have all of this overhead expense and often times, on a regular income statement, it will be called selling, general and administrative, or overhead costs, or operating costs or something like that.

In some ways, art can change the world.

This is the PC guy over here.

I'm a salesperson.