GERMANY: From “changarro” in Mexico to “bakala” in Saudi Arabia, there are a wide variety of local names for traditional trade in emerging markets. But no matter the name, Henkel’s laundry & home care unit is focusing on this important sales channel.

According to Henkel, there are 20 million traditional traders around the globe—from street stalls to neighborhood “mom and pop” stores. Today, they account for around 50% 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,” explained Christoph Till, corporate director international sales, laundry and 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 storeowners are also brand ambassadors and make their own decisions about their often-limited range of products on offer.

“Traditional trade is a highly complex sales channel in the emerging markets: varying requirements, small-scale deliveries and widely scattered stores with little storage space present marketing and sales with major challenges,” Till said.