Marketing and branding | Sep 26

Delta Xero: transitioning from distributers to direct sales

Marketing and branding | Sep 26

Delta Xero is improving margins by moving from distributor-led sales to direct customer marketing

Reading Time 4 minutes

When Collette Whiting looks back at the early days of Delta Xero, she’s still struck by how far the business has come. What started as a garage-based research project has grown into a £1.7m company with customers in energy, marine, mining, and manufacturing industries around the world.

‘We began with a simple idea,’ says Collette, now Chief Operating Officer. ‘My husband saw a gap in the fluid filtration market. Existing products were complicated, expensive, and didn’t deliver the efficiency customers needed. So he started developing a better solution in our garage. Eighteen months later, we had a prototype ready to launch.’

That prototype became Delta Xero’s core product: an oil and fuel filtration system that removes microscopic contaminants, extending the life of machinery, reducing breakdowns, and cutting oil waste. Its simplicity is a key differentiator: a single cartridge design that works across multiple fluid types, unlike competitors with complex ranges.

Building momentum

The company’s early years were defined by rapid growth. After launching in 2019, Delta Xero reached an impressive turnover of £750k in its first year. Despite the pandemic reducing revenues to £600k in 2020, the business has scaled steadily since: £1.1m, then £1.3m, and £1.7m in 2024. The team has expanded from four to more than a dozen staff, and the business recently moved into larger premises in Hampshire.

But this growth also highlighted a challenge: reliance on distributors.

‘In the beginning, we relied heavily on distribution partners. To get traction, we offered big discounts, which meant margins were reduced. It worked to get us into new markets, but long term it wasn’t sustainable. We realised we needed a different approach.’

Shifting the sales strategy

Distributors played a vital role in Delta Xero’s early expansion, but as the company matured, the drawbacks of the model became clear. By offering significant discounts to secure distribution, the business sacrificed margin and risked being one step removed from its end customers.

As Collette explains: ‘Working through distributors was great for exposure, but it meant we weren’t always close to the decision makers. We wanted to understand the customer’s pain points directly and build relationships that last.’

The company’s response has been to move towards a dual-channel approach: maintaining trusted distribution partnerships while also investing in a direct sales and marketing function.

They have already appointed their first technical sales manager whose role is to grow direct customer relationships and support technical demonstrations ‘in the UK’. Internationally, Delta Xero is ‘then’ building out a network of master distributors — partners with exclusivity in specific markets, such as the United States — who are incentivised to invest in developing the brand.

This deliberate shift reflects business theory in action. Applying Porter’s Five Forces, distributors can be seen as ‘powerful buyers’ with strong bargaining power. By building its own sales channels, Delta Xero reduces this dependency and increases its control over pricing and customer experience. Similarly, the move can be mapped onto Ansoff’s Matrix: from pure market penetration (selling more through distributors) to market development (expanding into new territories and channels).

‘We’ve reached the stage where we need balance,’ Collette says. ‘Distributors helped us get off the ground, but developing our own sales capability will protect our margins and put us closer to the people using our technology.’

Building marketing capability

Alongside sales, Delta Xero is strengthening its marketing. The team has begun using customer persona research, a technique Collette discovered during the Help to Grow: Management Course, to tailor campaigns more precisely. Instead of relying solely on distributor-led marketing, they are creating their own messaging that emphasises the product’s environmental and operational benefits and empowers their ability to sell direct to customer.

‘Our story resonates when people hear it directly,’ Collette explains. ‘By showing how we extend equipment life, reduce oil waste, and prevent breakdowns, we can connect with the sustainability agendas of global industries. That’s harder to achieve when the message is filtered through a third party.’

Lessons for other SMEs

Delta Xero’s evolution offers several clear insights for SMEs considering how to scale:

Beware of overreliance on one route to market: distributors offer reach, but can hold too much bargaining power. Explore hybrid strategies that balance partners with direct sales.

Apply frameworks to decision making: tools like Porter’s Five Forces and Ansoff’s Matrix help leaders analyse market position and clarify growth options.