Difficulties Encountered by Distributors in Assessment and Management (1) Sales staff are all old employees, managed humanely without many rules, making penalties hard to enforce. (2) Staff shortages during peak seasons. (3) No process indicator assessment, service staff for distributors lack business functions (mainly delivery). Direct supply outlets are too few, below 10%, needing to increase direct supply rate and cultivate staff quality. (4) No assessment for those serving secondary wholesalers, staff lack market development ability, purely physical labor. There has been a desire to assess these people, but they resist, lack market development ability, and complain about hard work and low pay. There is a plan to replace them and improve staff capability and quality. (5) Commission calculation is too simple, lacking incentive for promoting specific products, mainly because no new products have been introduced for a long time. (6) Imbalance between regions and outlets, leading to income gaps among sales staff. Fines for sales staff are hard to enforce, and staff turnover is high. (7) Delivery staff change frequently within 1-2 years due to hard and dirty work, which locals are unwilling to do. Sometimes during peak seasons, staff collectively resign demanding pay raises; later, without raises, those willing to work return, while others leave. (8) Unable to set specific assessment indicators; rewarding is easy, but punishing is difficult. Product variety is single, only high-end liquor, making it hard to penetrate village-level terminals. (9) During peak seasons, staff take leave, and there is not enough manpower. (10) Staff with 1-3 years of tenure become hard to manage over time. Staff have low business skills, poor discipline, and frequently take leave; there is a full attendance bonus, but it is not attractive to employees. (11) Need to determine if their ideas are feasible; sales are high, but profits are low, expenses are large, and there is no detailed breakdown of cost investment and flow. (12) Baijiu staff and beer staff earn similar wages, but beer work is heavy, leading to high turnover. A team that sells beer in summer and baijiu in winter cannot cultivate good salespeople. (13) Unable to solve the problem of layoffs; work efficiency is low, and service is poor. (14) Years ago, a slogan to stabilize employees was proposed, but after stabilization, old employees showed many problems: 1. Not visiting difficult customers (too familiar with terminals); 2. Declining service attitude (because products sell well); 3. Not adapting to basic tasks (not doing promotional material placement, shelf restocking, etc.). (15) Wage issues, workload issues. Staff choose jobs with lower workload. Confusion: staff are relatively lax, rules are incomplete, and there is only subjective understanding of whether staff work hard. (16) The "big pot" work management has been running for many years, and staff turnover has made delivery management difficult.

Five Preventions to Keep Distributors from Going Astray (1) Substitution. The famous brand Master Kong earns less than the knockoff "Master Shi Niang," so some secretly sell the knockoff for extra income. The distributor's land was originally for growing grain, but tenants may secretly plant sorghum! (2) Self-destruction. Delivering goods to someone else's territory will earn a bit more. Not stopping there, they even dump goods at low prices into that area. (3) Overdrawing resources. The contractor always considers profit maximization; sustainable market development is not their top priority. Intercepting, transferring, changing promotions, raising prices on new products, or clearance sales are common tactics used by sales staff. (4) Setting up their own camp. After market contracting, terminal customer relationship maintenance is fully transferred to the contractor, and sales staff inevitably face the temptation of becoming bosses. Once the opportunity matures, they will eye the bowl while eating, find a brand, and become bosses themselves. (5) Eating away at resources. The reason distributors can successfully contract out is often because the market has already been established, and there is a best-selling product supporting it, which is why contractors dare to take it on. However, due to fighting separately, price systems gradually become chaotic, outlets are lost one by one, and with competitor encroachment, advantages will be completely lost. Doing the five preventions well is to avoid distributors going astray into the "hands-off boss" trap and avoid getting beans when planting melons.

Four Stages of Distributor Management For distributors, there are four stages to go through in improving internal management. Alternatively, distributors can be divided into four categories from a management perspective.

Distributor Management Stage One: The Big Pot Stage. Characteristics of the big pot: (1) Doing well or poorly is the same; everyone gets a share whether they work or not. (2) Characteristics of a mom-and-pop shop, exclusive to micro and small distributors, and typical of family businesses. Core problem: Either cannot afford to hire sales staff or cannot retain them. Core contradiction: Distribution system and employment system. Core tool: Financial system. Accounts are chaotic, or there is only a simple running account; bookkeeping is not for management, and some accounts are even recorded on toilet paper. Self-check for big pot customers: Accounts: Sales, expenses, and surplus as of today. Bad debts: Payment terms (reasons for growth, reasons for decline). Advice: Profit and loss are not scary; what is scary is not knowing where profits come from and where losses occur! The first step for big pot customers to change: Commission system!

Distributor Management Stage Two: Commission System Stage. Commission system: Base salary + commission. Characteristics: More work, more pay. Two phases: (1) High base salary phase: 1. Early implementation; 2. Trial period for new employees. (2) Low base salary, high commission phase: 1. Business mature; 2. Personnel mature. Regions should be fixed, and indicators can be promoted after successful simulation experiments (to prevent excessive income fluctuations and unstable morale). Consider peak and off-season indicators or commission reserves. Commission methods: (1) Sales commission (based on collection amount), which can lead to dependence on old products. (2) Single product commission—by product type and grade. All of a salesperson's income comes from commission, provided that the brand is stable, regions are fixed, indicators are mature, and the team is stable. Key core of commission system: Financial support, indicator setting, regional division, and brand stability.

Distributor Management Stage Three: Contract System. Small contract: Personnel, vehicle, expenses. Key point: Indicators. Large contract: Personnel, vehicle, expenses, market. Personnel, vehicle, expenses, market + brand. Key point: Sovereignty. Warning: Prevent loss of sovereignty, substitution, and a mess!

Distributor Management Stage Four: Business Unit. Definition: The business unit system divides departments according to the business operated, including by product, by region, by customer (market), etc., setting up several business units, also called branches. Four supports: Mature management tools, mature management systems, stable team structure, and stable profit model. Three elements: Relatively independent market, relatively independent interests, and relatively independent autonomy. This article is excerpted from Mr. Fang Gang's book "FMCG Veterans All Do This: Regional Manager Playbook." -END-