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Distributors bear the function of transferring products and funds between manufacturers and consumers, so how to effectively manage distributors has always been a key concern in China's marketing industry and for manufacturers.

I. Focus on Distributor Interests This is the primary and most important task in effective distributor management. Undoubtedly, interests are the only bond that maintains cooperation between distributors and manufacturers. But how many manufacturers and marketing personnel truly care about distributor interests? Ask yourself: manufacturers set annual sales and profit targets, then break them down for distributors, but who helps distributors set their own annual profit targets from distributing products? Of course, manufacturers might say that how much distributors earn is their own business. Marketing personnel are busy with their own sales tasks every month and year, racking their brains at month-end to get distributors to place more orders and stock up, worried about not meeting targets and losing commissions. Who knows or cares how much distributors earn this month? Have we considered what benefits distributors can gain from distributing our products?

Many manufacturers claim distributors are strategic partners, which is a good notion. But if they are partners, both sides should be equal. If manufacturers and marketing personnel don't even understand what benefits and profits distributors can gain from distributing our products, how can we call them partners? Some might disagree, saying, "We are a famous brand; distributors will surely profit from distributing our products, or they wouldn't cooperate with us." Indeed, distributors may gain benefits and profits. But why do we demand loyalty from distributors? Why do we interfere when they want to distribute higher-margin competing products? Why do we complain that distributors are increasingly difficult to manage and uncooperative? The root cause is that we neglect distributor interest management. Because maximizing profits is not only the goal of manufacturers but also of distributors.

How distributors maximize benefits from distributed products should also be the most important and primary task for manufacturers. Maximizing distributor interests is not only the bond ensuring cooperation but also the foundation for ensuring distributor loyalty and increasing product promotion efforts. Distributor management should never be limited to utilizing and controlling distributors. So how can manufacturers and marketing personnel manage distributor interests well?

  1. First, clarify what benefits and profits distributors hope to gain from distributing our products.
  2. What measures do we have to ensure distributor interests, and are they effective?
  3. Under what circumstances do we harm distributor interests?
  4. The most important aspect of distributor interest management is profit management. Care about distributor profits as much as we care about our sales.
  5. When setting annual and monthly sales targets for distributors, help them set annual and monthly profit targets, then develop marketing strategies around these targets.
  6. When analyzing whether sales targets are met, also analyze whether distributor profit targets are met. Manufacturers and marketing personnel should regard distributor losses from distributing products as a disgrace.

II. Meeting Distributor Needs Is Meeting Our Own Besides interests, distributors have various other needs that require research and management by manufacturers and marketing personnel. If a manufacturer and its marketing personnel can accurately identify and meet distributor needs, distributor management would have no problems.

So how should manufacturers and marketing personnel manage distributor needs?

  1. Establish a smooth information exchange and communication platform with distributors to discover their needs. For example, many manufacturers now use the internet, internal newspapers/magazines, and dedicated hotlines to build communication platforms.
  2. For distributor needs, manufacturers should keep records and assign dedicated departments and personnel to handle them.
  3. For common needs that manufacturers can meet, work together to satisfy them. Examples include: requests for product updates due to aging; hopes for distributor conferences; requests for distributor columns in manufacturer publications; and desires for training from the manufacturer.
  4. For personalized needs, manufacturers should try their best to meet those that require their action; marketing personnel should be arranged to meet those within their capacity.
  5. Marketing personnel should also learn to identify distributor needs in daily work and meet them as much as possible. Never think that tasks outside your job description are not your responsibility. For instance, some distributors may need help with planning, or their children may need tutoring. Many marketing personnel are professionally trained and can use spare time to meet these needs. Distributors will be very grateful and fully support your work.

In fact, through need management, manufacturers and marketing personnel can help distributors gain added value beyond profits. Marketing is essentially a process of meeting your own needs by meeting the needs of your target. Companies and marketing personnel must not think they are making extra sacrifices to meet customer needs, because by meeting distributor needs, we ultimately meet our own needs—unless the needs you meet are not genuine or distributors are heartless.

III. Training Training is a task that requires high attention. With intensifying market competition, many distributors feel business is getting harder, and past experience no longer guarantees success. They are eager to learn, adjust, and innovate, but they are busy with business and lack time. Naturally, they turn to their partners—the manufacturers whose products they distribute. Manufacturers generally have standardized management and sound systems, and many have dedicated training departments. Manufacturers must also realize that ensuring distributors grow in sync with them is crucial for their own development and progress.

So how should manufacturers conduct distributor training?

  1. Understand distributors' training needs.
  2. The training department can set up a dedicated distributor training unit to handle this.
  3. Use the internet and internal publications to publish training articles for distributors.
  4. Hold regional distributor training meetings.
  5. Every marketing personnel should become a trainer. The training department should include "how to conduct training" as a topic in marketing personnel training.
  6. Manufacturers should collect success and failure cases and materials from distributors in different industries and companies, as these are excellent training resources.

IV. Don't Indulge Distributors Some marketing personnel often complain: "I often give face to clients, and sometimes I bend principles to give them green lights, but they don't appreciate it and even become more demanding." This is actually the trouble caused by indulging distributors.

Cooperation between distributors and manufacturers is based on certain rules and institutional norms. Once a distributor violates rules or breaks regulations, warnings and corresponding penalties should be issued immediately. However, some marketing personnel, out of face-saving or overly close relationships, turn a blind eye and ignore violations. As a result, distributors come to see rule-breaking as normal, even thinking rules are just deceptive, and that manufacturer management doesn't rise to the level of rule enforcement. When things deteriorate beyond repair, if you try to manage or punish them, they will turn against you.

Take distributor payment delays: the first time they may feel embarrassed, the second time they deliberately delay, by the third time they think owing is normal, and by the fourth time they may be brazen and think they owe too little. If you then demand no more arrears, will they listen?

Therefore, manufacturers and marketing personnel must maintain a certain distance in distributor management. Rules are rules, systems are systems. Violations must be dealt with accordingly; otherwise, you will have to swallow the bitter fruit of indulgence.

V. Manage Distributors' Downstream Customers Many manufacturers and marketing personnel rarely truly manage distributors' downstream customers. Many manufacturers spend huge manpower annually to count secondary wholesalers and retail customers, but the data is often inflated because the basic statistics are provided by marketing personnel, who may hastily compile a list to meet sudden statistical tasks.

In fact, managing downstream customers is a heavy and skill-demanding task. It requires manufacturers and marketing personnel to regularly collect and analyze data on downstream customers, and also to monitor changes in their numbers. This analysis helps manufacturers identify reasons for sales fluctuations and discover problems at a macro level, and also helps find reasons for distributor sales changes and management issues, allowing for marketing strategy adjustments. Managing downstream customers is also the best way to prevent distributor betrayal, because no distributor would dare to be careless with manufacturers and marketing personnel who know their downstream customers thoroughly.

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About Us: WeChat Name: FMCG Distributor Professional Consulting Management Account Introduction: 20 years of FMCG distributor operation and management experience, specializing in distributor internal management: We understand distributors better than manufacturers, and we know internal management better than distributors. Senior marketing experts help your business grow.

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