---
title: "5 Major Misconceptions in Distributor Shelf Placement: More Products Isn't Always Better!"
description: "As the saying goes, 'He who controls the channel wins the market!' While true, this has led to fierce competition among distributors, shrinking profits and increasing channel complexity, ultimately benefiting the channel players themselves. To change this chaos, distributors must not only abandon cutthroat competition but also be wary of many pitfalls in market operations. Today, we focus on common misconceptions in distributor shelf placement: -01- Quantity over quality. Many distributors believe that more retail outlets mean higher sales, so they demand no blank spots in the market, but this often leads to wasted resources and hidden problems."
author: "陈晓明"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2019-12-25"
categories: "Dealer Operations"
language: "en"
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markdown: "https://xinjignxiao.com/en/articles/5-major-misconceptions-in-distributor-shelf-placement-more-products-isn-76fd3fd6.md"
original_source: "https://mp.weixin.qq.com/s/KTCfYOJNDbmvoKLBi2dLVQ"
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citation: "陈晓明. “5 Major Misconceptions in Distributor Shelf Placement: More Products Isn't Always Better!.” New Distribution, 2019-12-25. https://xinjignxiao.com/en/articles/5-major-misconceptions-in-distributor-shelf-placement-more-products-isn-76fd3fd6/"
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---

# 5 Major Misconceptions in Distributor Shelf Placement: More Products Isn't Always Better!

> As the saying goes, 'He who controls the channel wins the market!' While true, this has led to fierce competition among distributors, shrinking profits and increasing channel complexity, ultimately benefiting the channel players themselves. To change this chaos, distributors must not only abandon cutthroat competition but also be wary of many pitfalls in market operations. Today, we focus on common misconceptions in distributor shelf placement: -01- Quantity over quality. Many distributors believe that more retail outlets mean higher sales, so they demand no blank spots in the market, but this often leads to wasted resources and hidden problems.

**As the saying goes: He who controls the channel wins the market!** While true, it is precisely this saying that has led to unprecedentedly fierce competition among distributors. The more intense the competition, the smaller the profits for distributors, and the harder channel operations become, with the ultimate beneficiaries being the channel players themselves.
To change this chaos, distributors must not only abandon such cutthroat competition but also be wary of many pitfalls in market operations. Today, let's focus on common misconceptions encountered in distributor shelf placement:
**-01- Quantity over quality**
Many distributors, during shelf placement, always believe that the more retail outlets they develop, the higher the sales volume. So they demand that the market leave no blank spots, ensuring their products are visible everywhere. However, after spending considerable money and effort to achieve this goal, the desired sales don't materialize, and it leaves many hidden problems for later.
For example: A snack food distributor, Mr. Wang, in a certain area, always thought his company's sales weren't rising. After visiting the market, he found that his product's shelf placement rate wasn't enough. So he set the company's current strategy as shelf placement and assigned shelf placement tasks to each salesperson, demanding not to miss any blank spots. Under a system of heavy rewards and penalties, salespeople frantically increased the number of outlets, and sales also improved, which pleased Mr. Wang.
Little did he know that three to four months later, there would be a large number of return and exchange requests (since general snack foods have a shelf life of half a year). If he didn't accept returns, it would damage the company's reputation; if he did, it would cause a large amount of near-expiry products, harming the company's interests. Mr. Wang fell into distress again.
In fact, the root cause of Mr. Wang's distress lies in the initial shelf placement strategy. Increasing the number of outlets is not wrong, but during this process, the company had no evaluation criteria for new outlets. Due to the shortcomings of many outlets, products didn't sell, leading to a large number of returns and exchanges.
Therefore, while increasing the number of outlets, distributors **must also pay attention to the quality of the outlets themselves. Does the outlet owner cooperate? Are payments timely? Is business good or bad? What kind of consumer groups are around?** These are all criteria for judging outlet quality.
**-02- Big stores over small stores**
Many distributors, during shelf placement, often require sales personnel not to miss any large stores in the area. They believe that large stores can both enhance brand image and increase product sales. This is true, but cooperation with large stores often comes with higher thresholds, and many of their cooperation terms prevent distributors from gaining much advantage.
However, small stores are different. Cooperation with small stores is basically cash on delivery, with no special terms, just need good after-sales service. At the same time, some small stores, due to good locations and enthusiastic owners, have decent business.
For example: A condiment distributor, Mr. Li, in a certain area, whose company specializes in large stores, has hit a sales bottleneck in recent years. Sales aren't increasing, cooperation terms are increasing, and many partner stores have closed overnight, leading to uncollectible payments, leaving Mr. Li anxious every day.
A brand manufacturer that Mr. Li distributes suggested he try vegetable stores (many cities now have specialty vegetable stores that also sell condiments, groceries, etc.). Initially, Mr. Li wasn't very interested in vegetable stores. The brand manufacturer used its own brand as a pilot, covering about 30 vegetable stores, all cash on delivery. Within less than a week, 80% of the stores requested restocking. Mr. Li became interested, visited these stores, and upon returning, formulated a strategy that yielded significant profits.
The channel transformation not only benefited Mr. Li but also turned around the passive large-store business. In the case, although vegetable stores are small, they cooperate well, and it's easier to implement sales promotion operations. As long as distributors focus on the quality of these small stores, the value they bring to the company is no less than that of large stores.
**-03- Big brands over small brands**
Some distributors, during shelf placement, often feel pressured by big brand manufacturers and have to devote all their limited energy to these brands, resulting in them "sleeping later than dogs and waking up earlier than chickens." Even so, big brand manufacturers are not satisfied and always find various problems to constrain you, leaving many distributors complaining but helpless.
In fact, this is a common tactic used by big brand manufacturers. They enjoy pressuring distributors, keeping them busy, even hoping distributors dream about them, so they can control distributors and make them loyal "porters."
Rather than saying it's forced by big brand manufacturers, it's better to say distributors bring it upon themselves. Whoever's territory it is has the final say. To break free from this situation, distributors must have their own product portfolio planning. Use big brands to drive small brands. Big brands have high awareness and many consumer groups, so they can be used to lead small brands during shelf placement. But big brands tie up capital and have low profits, which small brands can compensate for, avoiding resource waste.
**-04- Customer relations over supervision**
When it comes to customer relations, distributors each have their own methods.
Often, during shelf placement, when a distributor's salesperson goes down, terminal customers accept the products, indicating excellent customer relations. But good customer relations don't necessarily mean sales or no after-sales issues.
On the contrary, good customer relations often lead to after-sales problems (like handling slow-moving inventory, severe stockouts, etc.), causing unnecessary losses.
For example: A beverage distributor in a certain area, because of good customer relations, had terminals buying in, so new product placement went smoothly, quickly occupying various terminals. But during placement, salespeople delivered goods to terminal stores and left. Many terminal store owners stocked shelves themselves, rarely considering the "first-in, first-out" principle (because of good relations, returns and exchanges were guaranteed). After about half a year, they would ask the distributor to handle slow-moving products.
Also, some terminal stores, due to good relations, didn't even notice stockouts (because you visit often, they don't worry about it). Once distributor sales personnel become negligent, this situation increases significantly, leading to lost sales.
Therefore, **while customer relations are important, market supervision is even more crucial.** As in the above case, because salespeople are busy and let terminals stock themselves, terminals need to understand the "first-in, first-out" principle. Since they have the mentality of guaranteed returns, distributors should set return standards, such as not accepting returns if products are within a certain period before expiry. With good customer relations, they will surely cooperate.
**Only with good customer relations can you achieve twice the results with half the effort; only with good supervision measures can you avoid unnecessary losses.**
**-05- Results over process**
Many distributors, in various company assessment indicators, are result-oriented, and shelf placement is no exception.
Actually, focusing on results isn't bad, but distributors must know that any good result has a wonderful process, and in that process, there are many behaviors or experiences worth learning; any bad result has a process that can be summarized or learned from.
As managers, they should summarize these and form company processes or standards.
For example: A distributor, Mr. Yang, in a certain area, during his team's shelf placement, paid great attention to the process. For salespeople who performed well in placement, he would have them share their experiences; for those who encountered obstacles, he would have them explain the specific reasons and let other team members help find solutions.
Then, he summarized the placement process and standards for other employees or new employees to learn. This way, everyone has a deep impression of the concept of shelf placement, and when doing placement work, they face fewer obstacles.
The above five misconceptions require distributors to be constantly vigilant during actual shelf placement. Once neglected, causing unnecessary losses, it would not be worth it.
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## Citation metadata

- Publisher: New Distribution
- Author: 陈晓明
- Published: 2019-12-25
- Canonical: https://xinjignxiao.com/en/articles/5-major-misconceptions-in-distributor-shelf-placement-more-products-isn-76fd3fd6/
- Original source: https://mp.weixin.qq.com/s/KTCfYOJNDbmvoKLBi2dLVQ

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