---
title: "10 Key Points for Effective Distribution in Retail Outlets, or You'll Never Make Money!"
description: "When it comes to distribution, many distributors say, \"What's so hard about it? We do it every day!\" But in reality, achieving \"effective distribution\" is not simple. Through exchanges with numerous distributor friends, the reporter has summarized ten key points for effective distribution, hoping to provide reference and help for distributors."
author: "New Distribution"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2018-03-23"
language: "en"
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# 10 Key Points for Effective Distribution in Retail Outlets, or You'll Never Make Money!

> When it comes to distribution, many distributors say, "What's so hard about it? We do it every day!" But in reality, achieving "effective distribution" is not simple. Through exchanges with numerous distributor friends, the reporter has summarized ten key points for effective distribution, hoping to provide reference and help for distributors.

When it comes to distribution, many distributors say, "What's so hard about it? We do it every day!" But in reality, achieving "effective distribution" is not simple. Through exchanges with numerous distributor friends, the reporter has summarized ten key points for effective distribution, hoping to provide reference and help for distributors.

**Point 1: Distribution starts with setting clear goals**
Distribution tests a distributor's basic skills. An effective distribution not only expands the number of sales outlets but also brings sales volume, which almost every distributor can anticipate. However, which distributor, before distribution, has clearly defined how many retail outlets to add, how much to increase the distribution rate, how much to boost monthly sales, what gross margin points to control, what the fixed cost allocation ratio is, and to what extent terminal visualization should be achieved?

If distributors can start from the above sub-goals and combine them with the company's actual situation to develop a feasible implementation plan, it will not only make the work content and processes of sales staff clearer but also effectively lay a solid market foundation and gain more benefits and value in subsequent market promotion.

**Point 2: Use pricing strategies to ensure distribution success**
A successful distribution requires a reasonable product pricing strategy.

If the supply price is too high, terminal stores find it hard to accept, and it lacks price advantage for consumers; if the supply price is too low, distributors have no profit, terminal stores may not sell at high prices, and the product may be labeled as low-end. So how should product pricing strategies be designed? Product pricing should combine the product's own positioning and characteristics, and formulate differentiated distribution strategies for different products:

First, for volume products, i.e., products with sales advantages in a certain channel, it is recommended to adopt a parity pricing strategy to help better build the channel;

Second, for profit products, i.e., products with obvious differentiation from competitors, it is recommended to adopt a high-price strategy, focusing on shaping brand image and providing profit protection for distributors;

Third, for competitive products, i.e., products of the same grade and type as local competitors, it is recommended to adopt a low-price strategy to combat competitors.

**Point 3: Terminal distribution should not only be fast but also stable**
After rapid distribution, distributors often encounter slow terminal sell-through, and some even face large-scale returns and exchanges, which is directly related to misjudgment of market expectations. In addition, manufacturers now have certain requirements for distribution rates, which to some extent forces distributors to pursue high distribution rates to cater to manufacturers, hoping to apply for more powerful market support. However, distributors should view distribution rationally, plan and deploy the scope, quantity, and pace of distribution clearly, and pursue rapid distribution on the premise of ensuring market stability. In this way, distribution volume and sales can increase simultaneously.

It is worth noting that during the initial distribution, terminal inventory should not be too large. It is sufficient to ensure terminals have goods to sell according to the 1.5 times safety stock principle, which can effectively prevent large-scale returns later. In fact, the focus of new product distribution is to seize terminal shelf space. Only when consumers see the product is there a possibility of sales, which is the biggest role of distribution.

**Point 4: Carefully weigh the pros and cons of credit-based distribution**
Credit-based distribution for new products is not new, but it is worth noting that while credit sales quickly increase the distribution rate, they also bring certain risks to manufacturers and distributors. The effect of credit-based distribution is obvious: because it is easy to enter stores, terminal store owners generally accept it gladly, but this does not mean that terminals will attach much importance to the new products on credit. The reason is simple: other products are bought with the terminal's own money, while credit products cost them nothing, so store owners are more eager to recover their capital and achieve profitability. This "favoritism" will directly affect the subsequent sales of credit products.

In addition, credit sales sometimes require paying terminals certain display fees, and some even promise to return cash higher than the value of the goods, trying to open the market in this way, but the result often leads to terminals engaging in arbitrary cross-region sales, price-cutting, and disrupting the entire market. Therefore, distributors should think twice before deciding to adopt credit-based distribution and formulate preventive measures.

**Point 5: Detail control determines distribution effectiveness**
Distribution is not just about moving products to terminal stores; there are many detailed tasks that need to be implemented to improve distribution effectiveness and better drive subsequent sales. So, what details must be noted?

First, clear division of labor: distribution is generally carried out in groups, with the group leader responsible for communicating with store owners about stocking, while other members are responsible for posting POP, installing hanging nets and strips, stocking shelves, and collecting payments;

Second, each group strictly follows the established routes and areas for distribution, cooperating with each other, and all matters during distribution are coordinated and resolved by the group leader;

Third, all personnel are familiar with sales policies and formulate different promotional policies for different customers, but cannot exceed specified limits;

Fourth, all personnel should patiently and meticulously explain to terminal customers, not seeking quick success or instant benefits, not focusing on distribution quantity and amount, but only on developing blank outlets. For customers who do not make a deal, still smile and leave a good impression for the next distribution.

**Point 6: Strengthen the sales skills of distribution personnel**
During product distribution, the most common problem reported by salespeople is difficulty entering stores. To this end, distributors generally formulate attractive promotional policies to attract retail store owners to stock up, but rarely study the behavior of frontline salespeople. So we often see salespeople enter a store and say, "Boss, do you want XX goods?" When they find the owner is not interested, they follow up with, "We have a promotion, XX gift XX." If the owner remains indifferent, the salesperson is at a loss.

In fact, retail store owners think about two things: one is making money, and the other is low risk. Combining these two points, distribution personnel can follow certain skills when selling:

First, the first thing after entering the store is to greet the owner, then introduce yourself, and use confidence to earn trust;

Second, introduce the product in detail and accurately, especially explaining the profit structure, to arouse the owner's interest;

Third, after the owner is tempted, urge him to order immediately, and do a good job of product shelving and seizing ground promotion. After that, provide good after-sales service, encourage the owner, and achieve product sell-through as soon as possible.

**Point 7: Play psychological warfare with retail store owners**
Sales work tests not only the skills of sales personnel but also psychology. When negotiating distribution with a terminal store owner, it is often a psychological game. Therefore, before distribution, salespeople should fully understand the psychology of store owners and grasp their common psychological traits:

First, salespeople should be clear that if the terminal store owner does not recognize the product, then discussing price and promotional policies will have minimal effect. So when introducing the product, fully showcase its selling points and market potential to enhance the owner's confidence in the product;

Second, when the store owner does not have much resistance to the product but still refuses to order, it may be a hint for extra concessions in price policy. At this point, the initiative is in the salesperson's hands.

In addition, salespeople should clarify their stance during negotiations: first, we are bringing profits to retailers, so we should be confident; second, we sell not only products but also services, and we can deliver; finally, we are not selling goods to terminal stores, but selling through terminal stores. Only when salespeople agree with these points can they win the psychological game with store owners.

**Point 8: Collect customer information and update the database in a timely manner**
Distribution targets not only old customers but also new customers. Therefore, after completing distribution work, customer information should be promptly collected and entered into the relevant database. To avoid errors, it is best to organize customer information after each day's distribution, including the owner's name, address, phone, fax, order quantity, main product categories... as detailed as possible.

Distributors can also set up a dedicated business clerk responsible for collecting customer information and making phone visits after a round of distribution to inquire about customer inventory and promptly notify the corresponding salesperson to follow up. Although registering customer information is tedious, these data can provide strong support for distributors to implement deep distribution strategies, thereby laying the foundation for the next distribution. Therefore, it becomes a link that needs to be repeatedly emphasized in the distribution process.

**Point 9: Follow up in a timely manner; distributing well is not enough, selling well is better**
After distribution, distributors often encounter situations like this: a round of distribution is completed well, but later returns and exchanges are very high. Distributors who have learned lessons will pay more attention to terminal inventory control. In addition, to effectively achieve product sales after distribution, distributors should always pay attention to market trends:

First, for customers with large order quantities, once slow sell-through is found, it is necessary to change channels or regions to digest inventory. For losses caused by excessive inventory due to over-ordering, the salesperson bears the loss;

Second, always pay attention to market retail prices, strictly prohibit large customers from dumping at low prices after enjoying promotional policies, ensure the profit of each terminal customer, and thus ensure the overall stability of the market;

Third, closely monitor competitors' promotional activities, distribution policies, and price systems. Once information is found, sales personnel in each region should immediately report to the company at the fastest speed, and the company leaders and manufacturers should formulate corresponding countermeasures. Through these measures, the effect of early distribution can be fully utilized.

**Point 10: Be prepared for a battle with competitors**
During the distribution process, distributors may encounter counterattacks from competitors, which can disrupt the normal distribution plan and even lead to the failure of the distribution plan. Based on the principle of prevention first, distributors should consider various counterattacks from competitors when formulating distribution plans. Only in this way can competitors have no way to start, and even if they counterattack, it will be ineffective.

Of course, even the most thorough distribution plan may have oversights. If competitor counterattacks affect the normal progress of distribution, it is necessary to be flexible, avoid the strong and attack the weak, and formulate several alternative distribution plans: first, ensure the continuity of distribution actions; second, design according to the defects and loopholes of each distribution plan; third, consider the most likely ways competitors will counterattack.

For example, when initially designing promotional intensity, it should be greater than the promotional intensity competitors might follow, so that competitors cannot follow; speed up distribution, prioritize distribution to key areas and terminals, seize terminal display space and stocking funds; pay close attention to key terminals where competitors have already stocked goods, and strive to follow up in a timely manner when competitor inventory decreases, to regain lost ground.

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