In China's FMCG industry, the past three decades were a period of 'easy wins.' A generation of distributors once dominated channels thanks to a few major brand dividends. But today, that path is clearly no longer viable. After talking with many distributors, we found that brand dividends are gone, business growth is sluggish, and transformation seems to be the only consensus—but how exactly to transform? We've seen many successful cases, and we've been thinking: is there a more down-to-earth example that ordinary distributors can see themselves in and truly learn from? Yes! The story of Leguan Yigou is such a case. Its predecessor was a regional leader that once achieved annual sales of 150 million yuan relying on P&G. From being the regional 'washing and care overlord' to voluntarily giving up the top brand, transforming into multi-category operations, and then tackling B2b, it experienced almost all the challenges a distributor might face in transformation. But precisely because it 'fell into pits and waded through mud,' Leguan Yigou achieved the most solid growth. In 2024, the Leguan Yigou platform was officially launched, with first-month sales exceeding 2.04 million yuan, 8,000+ registered stores, and 1,200+ active stores, becoming the only FMCG B2b platform in the Yantai-Weihai region to achieve 'full-category + online-offline synergy.' As of the first half of the year, the platform's monthly sales steadily exceeded 6 million yuan, with over 8,000 registered stores and over 4,000 monthly active stores. The team grew to over 60 people, with professional procurement and operations staff accounting for more than one-third, building supply chain capabilities covering ten core categories including snacks, daily chemicals, alcoholic beverages, and personal care. Its practice may provide a real transformation reference for all distributors currently trapped in the present. 500,000 Yuan Advance Payment, Betting on Yantai's Washing and Care Leader In 1994, Fuji Trading was established, initially dealing in furniture and pawn business. At that time, President Tan keenly noticed the growth in demand for daily chemical products, and the following year began to venture into the washing and care industry, but due to lack of expertise, it never took off. The real turning point came in 1997. P&G was looking for distributors in the Yantai-Weihai area, inspected several companies including Fuji, and clearly stated, 'If you want to be an agent, first pay a 500,000 yuan advance payment.' 'We had just entered the industry and knew nothing,' Tan recalled. 'We only knew that P&G was a big brand, products on the shelves were always neatly arranged, prices were clear, and many people bought them. Following it, we could learn real things!' Tan's father made the decision on the spot, and that afternoon 500,000 yuan was transferred to P&G's account, making Fuji an official P&G distributor. This 'gamble' paid off with a golden decade. From 1997 to 2005, Fuji represented more than 30 washing and care brands, with sales exceeding 60 million yuan, becoming the veritable 'washing and care overlord' in the Yantai-Weihai region. In 2005, P&G implemented a 'exclusive policy.' At that time, P&G accounted for as much as 60% of Fuji's business, so Fuji chose to cut other brands and focus exclusively on P&G. In the following eight years, Fuji completely restructured its organization according to P&G's system, and the team's professional capabilities were honed to the extreme. By 2013, P&G's single-brand annual sales exceeded 150 million yuan. However, there was also a hidden crisis. Seeking Internally, Restructuring Interests, Making Employees 'Bosses' 1. Cutting Off the Arm to Survive, Voluntarily Giving Up P&G 'In the final years of exclusive operation, I almost got depression,' Tan admitted. The manufacturer adopted a big-customer strategy, and Fuji was gradually marginalized. The manufacturer's heavy tasks, strict policies, and continuously compressed profit margins left Fuji exhausted. 'We could only complete half of the tasks; the other half was thrown out.' In 2014, Fuji Trading resolutely 'cut off the arm' and voluntarily gave up the P&G exclusive rights. To find a way out, Tan turned her attention to snacks. 'Compared to daily chemicals, snacks have faster turnover and decent profits.' The transformation was undoubtedly painful. Old employees accounted for over 70%, with rigid thinking, accustomed to the rhythm of 'one specification sold for a year' in daily chemicals, unable to adapt to the 'multi-SKU, high-frequency, fast-turnover' approach of the snack category, resulting in massive cost waste and expiration losses, with sales dropping by 50%. This cold shower made management completely sober: the problem was not a lack of brands, but a lack of 'people' and 'mechanisms' capable of handling new brands. 2. Internal Revolution: From 'Assessing KPIs' to 'Assessing Operating Profit' In 2018, Tan went out to study, and the efficient, high-turnover model of B2b gave her a glimmer of hope. But upon returning, promoting digitalization met with collective resistance from old employees. After successive transformation setbacks, Tan and her returnee son, President Xiao Yi, made a crucial judgment: to resist external threats, one must first stabilize internally. B2b could be postponed, but the team's 'profit mindset' must be solidified immediately. Thus, a profound internal revolution began in 2019—the comprehensive implementation of the 'all-employee autonomous management system' reform. The core of this reform was to completely change the assessment method and interest distribution.

  • Calculate 'one's own profit': Abandon single sales assessment and instead assess 'operating profit.' Each employee becomes an independent 'operating entity,' looking not only at gross profit but also accounting for their own wages, freight, warehousing fees, and even the allocation of back-office management personnel costs.
  • Distribute 'the money deserved': The company takes 35% of net profit annually for dividends, strongly correlated with the operating profit employees create.
  • Give full 'autonomy': The company only sets the base price for products; employees can independently raise prices based on market conditions. The higher the sales price, the higher the profit, and the higher the dividends. 'This reform, I pushed it for two years without sleep under pressure,' Tan said. The shift from a sales mindset to an operating mindset was extremely painful, but the results were significant. Employees truly began to think like 'small bosses,' actively controlling costs and selecting high-margin products. This reform also allowed Fuji to grow against the trend during the pandemic, with retail channel sales still maintaining above 57 million yuan in 2023, and key cost indicators such as freight and loss decreased by 15%-20%. Breaking Out Externally, Blazing a Bloody Path Through Twists and Turns In 2019, just as the internal reform stabilized, the external environment deteriorated rapidly. Traditional business came under pressure, small store sales declined, and manufacturer investment decreased. 'Employees did nothing else every day but handle expired products,' Tan realized that without change, the huge traditional structure would eventually drag the company down. At the same time, mini-program technology matured, and the market gaps left by the successive exits of Yijiu Pi, JD.com, Alibaba, etc., in the Yantai-Weihai market gave Tan hope. She judged: 'Now is the right time to do B2b!' In 2023, Tan and President Xiao Yi conducted 9 external inspections nationwide. In December of the same year, Leguan Yigou was officially established, signed a software company, and simultaneously began warehouse renovation, officially starting the transformation battle. 1. Hardware Battle: 'Racing' the 60-Year Blizzard for the Warehouse The essence of B2b competition is supply chain efficiency, so the hardware foundation must be solid. Previously, Fuji's warehouse had 3-tier shelves, 656 storage locations, and a daily throughput of 200,000, which could not support B2b needs. Tan invited experts to redesign the warehouse layout and carry out a thorough renovation. However, at the end of 2023, just as they lifted the warehouse roof to raise the shelves, Yantai was hit by a once-in-60-years heavy blizzard. 50 centimeters of snow nearly collapsed the roof. The construction team said the snow was too heavy to work, but Tan gritted her teeth and said: 'We can't stop! Fuji's goods must be delivered, and Leguan's B2b is waiting for the warehouse to support it.' She had employees buy a dozen tarpaulins, and everyone wrapped in cotton jackets, moved goods in the snow—first transferring goods to the unrenovated area, covering them with tarpaulins, then proceeding with half-warehouse operations to advance the renovation. In the end, the warehouse was completed one month later than planned, with a total investment of over 3 million yuan. But when the first truck of goods was sent out from the new warehouse, Tan felt it was worth it—this warehouse can support the stocking needs of 8,000 small stores in the Yantai-Weihai area. 2. Software Battle: When the System Crashes, Let 'People' Become the System Software integration is almost a必经之路 for all distributors undergoing digital transformation. Tan's initial idea was to use one warehouse and one system to support both traditional and B2b businesses simultaneously. However, when Fuji's original 'non-standard' system needed to interface with B2b's 'standard product' system, problems arose. In August 2024, the mall's trial run crashed upon launch, and data between different systems could not be smoothly connected, making it impossible to obtain all the policies for direct manufacturer system connections. At the critical moment, the second-generation successor 'President Xiao Yi,' a math major returnee, stepped up, led tripartite talks, and made a key decision: not to wait idly for the system, but to use the most basic method—manually creating 'table within table' to get the business running first—exporting orders from the new system backend, inventory from the old system, then manually matching, and generating the next day's picking list at 2 a.m. to ensure the warehouse could ship normally. 'In three months, I made over a hundred tables, more than the math problems I did when studying!' President Xiao Yi laughed. It wasn't until the system's third launch succeeded. The team celebrated with a screen full of messages, but Tan believed that this time, it wasn't the system that worked, but the team that worked itself through. 3. Team Battle: Igniting the Team with 'Seeing is Believing' and 'Real Money' After solving the hardware and system issues, the team became reluctant again. First, old employees resisted, feeling that small stores had low output and wasted time; second, new employees were hard to recruit—after a month, not a single experienced person was hired. To solve the organizational problem, Tan adjusted recruitment requirements, prioritizing hiring motivated novices and training them under a mentorship system, while also raising salaries by 1,000 yuan; on the other hand, she organized employees to visit Zhengzhou and Luoyang for inspections. When they saw others' B2b businesses running hot, they were greatly shocked. 'Their eyes were full of light, and their passion was completely ignited.' On November 29, 2024, the Leguan Yigou platform was officially launched. To make a strong first impression, the company adopted the simplest and most direct method—'spending money.' On one hand, for customers: price cuts, coupons, full reductions, flash sales; on the other hand, for salespeople: high sales incentives, with rankings updated hourly. 'Competition was so fierce that orders were still being placed frantically at 23:59 at night.' More ingenious was the 'dual-track' salary system design: old employees who converted their original Fuji customers to the Leguan platform would continue to receive their performance commissions from Fuji for those customers; at the same time, for every order placed by those customers on the platform, the company would give an additional B2b sales incentive and commission. 'One performance, two incomes.' This completely dispelled the concerns of old employees, and team enthusiasm was instantly ignited. Within 3 days of the platform's launch, cumulative sales reached 350,000 yuan; first-month sales exceeded 2.04 million yuan. As of the first half of the year, the platform's monthly sales steadily exceeded 6 million yuan, with over 8,000 registered stores and over 4,000 monthly active stores. Final Thoughts: 'As long as the direction is right, even if you have to kneel, you must walk the path through.' Tan's words echo the sentiments of all successful transformers. Looking back at Leguan Yigou's transformation journey, there are several points worth learning:
  1. The real moat for distributors is the capability system they build themselves—refined operations, cost control, data mastery, and a team that can fight hard battles. Brands may change, channels may transform, but only one's own capabilities are the foundation for crossing cycles.
  2. Reform inevitably brings pain. All external transformations must be premised on internal revolution; first stabilize internally, then resist externally.
  3. For B2b transformation, pragmatism comes first. There is no perfect system, nor a perfect start. Logic first, tools as support, is the right solution. There is no sunset business, only sunset models. When old paths gradually fail, the biggest risk is not the failure of transformation, but standing still. Their practice lights a lamp for all peers still groping in confusion: The road is long, but walking will get you there; the task is difficult, but doing it will make it succeed.