Amid an economic downturn, all industries are struggling. A distributor once expressed his anxiety with concern: "Now even in some townships, there are big-box stores, and there are logistics distributors without physical stores that take orders by phone or online, with only warehouses and delivery. This has a big impact on traditional brick-and-mortar distributors. What should we do?" Making money is hard, money is hard to earn, and earning money is difficult. They are eager to change the status quo, but they are not clear about the future direction. These are indeed the challenges distributors face, but every problem has a solution. Recognizing the current crisis is the first step to resolving it.

The Crisis for Distributors From a market perspective, the current crisis for distributors is mainly reflected in the following aspects:

1. Coarse internal management, difficult to adapt to external conditions For example, a family-and-friends employee structure makes management standardization difficult. They do not understand or are not good at hiring professional managers. The boss juggles multiple roles, exhausting himself, and it is hard to build a real team. The enterprise's development hits a bottleneck.

2. The impact of manufacturers' channel reforms Due to rising costs of raw materials, logistics, and labor, companies are flattening their channels or even building their own channels to reduce channel expenses. To some extent, this squeezes the living space of distributors, leaving them in a dilemma.

3. Peer fission and differentiation Any industry goes through stages from non-free competition to free competition, and finally oligopolistic competition. Distribution is no exception. Some extend or differentiate downstream, some combine or optimize into cross-regional, large-scale distribution companies or groups, and some follow the Matthew effect: the strong get stronger, the weak get weaker, and eventually some exit the market. This is competition; it does not believe in tears and does not sympathize with the weak.

4. The impact of internet marketing An undeniable fact is that internet marketing, i.e., the emergence of e-commerce, has had a significant, even fatal, impact on traditional distributors. Open the internet, click any webpage, and you are bombarded with promotions for various products, along with search marketing, trace marketing, free marketing, and so on, all dazzling to the eye.

The Transformation of Distributors Facing the new situation, where should distributors go? On the new starting line, how should distributors base themselves on reality, look to the future, and remain invincible? The answer is transformation. If distributors do not want to be submerged by the tide of the times, they must achieve the metamorphosis from chrysalis to butterfly.

1. Become a brand operator. That is, hold two cards in hand: the manufacturer's card and your own card. This way, you can maneuver freely and are less likely to be a victim of "killing the donkey after it finishes the mill."

2. "Distributor + Shareholder". Penetrate upstream by investing in enterprises, becoming both a merchant and a manufacturer, combining the two, and achieving manufacturer-distributor integration.

3. Keep up with the internet. Whether distributor friends adapt or not, they must bravely embrace the changes brought by the internet; this does not depend on human will. Suning + internet gave birth to "Yigou," and COFCO + internet gave birth to "Womai.com."

Three Forms of Traditional Distributors Going "Electric"

1. WeChat business. That is, through WeChat or establishing WeChat groups, by "attracting fans," timely product releases and promotional pushes. However, due to the low entry barrier, the pain points of WeChat business are increasingly apparent. Generally, there are three: no content, no users, no transactions. Most WeChat businesses do a good job in product description and third-party testimonials at the transaction stage, but they post dozens of products a day, with buyer shows flooding the screen every day... Those who haven't been blocked on their Moments are true friends.

2. Leveraging third-party platforms. For example, JD.com, Tmall, Taobao, etc., using their huge customer traffic to leverage their strength. Compared to the risk of building your own online mall, this requires less investment and yields faster results. Here we must mention the just-concluded 2015 Double 11 e-commerce shopping festival, where Alibaba's total transaction volume reached 91.2 billion yuan, a year-on-year increase of 59.7%. However, in this grand e-commerce collective carnival, more than 90% of the participating merchants and brand agents were just selling at a loss for the sake of publicity, reluctantly joining the battle. Apart from gaining sales and maintaining user numbers, their profits were lackluster.

3. Chain stores + online mall, community O2O. Based on the calculation that 800 million urban residents, 250 million households, spend 2,000 yuan per month on household living expenses, the community life service market has a space of 6 trillion yuan. The community O2O model of online promotion and offline experience has become the most powerful direction for traditional distributors to transform. However, on the one hand, it is not recommended for enterprises to build their own community O2O platforms; it is time-consuming, labor-intensive, and costly, and it is difficult to see results and profits in the short term. They also lack internet talent and organizational genes, and it may end up as a mishmash. "Following" is much easier than "insight," so when building, you can cooperate with community O2O platforms that have national expansion or regional characteristics, borrowing each other's resources, funds, channels, customer relationships, distribution, and personnel to achieve online-offline integration. On the other hand, due to the large investment in physical stores, distributors can adopt a city partnership model with national chain retail stores or logistics companies, such as Beiquan (Internet + convenience store), integrating resources, with a win-win concept, interconnecting and complementing each other to strengthen and expand the market. Beiquan, as China's first community life service platform based on the Internet + convenience store model, focuses on providing community residents with supermarket goods and comprehensive community life services needed for daily life, meeting users' diverse, multi-scenario, and timely life service needs, making community life simpler and making the internet transformation of traditional distributors within reach. Its core value of "disintermediation, connecting users" allows distributors to move from behind the scenes to the front, that is, to control the terminal and face consumer groups directly, fully leveraging the original advantages of logistics, warehousing, products, and personnel for internet transformation, with low investment, low risk, and guaranteed returns. In just two years, the project has been successfully replicated in more than 40 cities including Guangzhou, Shenzhen, Xiamen, Hangzhou, Jinan, Taiyuan, Changchun, Hohhot, and Tangshan, helping dozens of distributors break free from traditional business bottlenecks and successfully transform to the internet. It has gained wide recognition from the capital circle. Currently, Beiquan is accelerating its layout of the national market, and it is expected to cover 100 cities nationwide by the end of 2016. In the context of the internet sweeping the globe, traditional distributors can only adjust their strategies, from sitting merchants to traveling merchants, from store merchants to e-merchants, actively exploring and meeting consumer needs, following trends, choosing the right platform, and actively transforming, to achieve the metamorphosis from chrysalis to butterfly. Distributor friends who want to learn more about Beiquan's Internet + convenience store model and transform to the internet can scan the QR code for consultation:

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