--- title: "Avoid Blind Distribution: Three Steps to Get Your Products into Every Effective Outlet!" description: "Terminal distribution is a crucial part of operating a model market, but many companies distribute blindly, either setting overly ambitious goals or lacking effective positioning, leading to unsold inventory. This article outlines a three-step approach to effective distribution: defining effective outlet standards, determining the total number of effective outlets, and setting reasonable distribution targets based on strategic positioning and competition." author: "孟令宇" publisher: "New Distribution" email: "zhaobo258@gmail.com" telephone: "+8615854817671" published: "2018-06-22" language: "en" canonical: "https://xinjignxiao.com/en/articles/avoid-blind-distribution-three-steps-to-get-your-products-into-every-eff-5a541c2e/" markdown: "https://xinjignxiao.com/en/articles/avoid-blind-distribution-three-steps-to-get-your-products-into-every-eff-5a541c2e.md" original_source: "https://mp.weixin.qq.com/s/pVSSR7fZRUuQi27XmlabRA" translation: "https://xinjignxiao.com/zh/articles/%E6%8B%92%E7%BB%9D%E7%9B%B2%E7%9B%AE%E9%93%BA%E8%B4%A7-%E4%B8%89%E6%AD%A5%E8%B5%B0-%E6%8A%8A%E4%BA%A7%E5%93%81%E9%93%BA%E8%BF%9B%E6%AF%8F%E4%B8%80%E4%B8%AA%E6%9C%89%E6%95%88%E7%BD%91%E7%82%B9-5a541c2e.md" attribution: "New Distribution — https://xinjignxiao.com/en/articles/avoid-blind-distribution-three-steps-to-get-your-products-into-every-eff-5a541c2e/" usage_policy: "https://xinjignxiao.com/ai-policy.txt" --- # Avoid Blind Distribution: Three Steps to Get Your Products into Every Effective Outlet! > Terminal distribution is a crucial part of operating a model market, but many companies distribute blindly, either setting overly ambitious goals or lacking effective positioning, leading to unsold inventory. This article outlines a three-step approach to effective distribution: defining effective outlet standards, determining the total number of effective outlets, and setting reasonable distribution targets based on strategic positioning and competition. Terminal distribution is a crucial part of operating a model market, but many companies distribute blindly, either setting overly ambitious goals that fail to achieve expected results, or lacking effective positioning, resulting in products that don't sell. How should companies distribute effectively? **Determine Effective Outlets and Set Reasonable Distribution Goals** There is no one-size-fits-all standard for terminal distribution goals in a model market. The distribution goal (distribution rate) should be set based on the product's attributes and target consumers, thereby defining the criteria for effective sales outlets. Then, considering the strategic objectives of the model market and the competitive landscape, the final distribution goal is determined. **This can be achieved in three steps:** **Step 1: Define the criteria for effective sales outlets.** This is a strategic matter for the company and part of a systematic marketing strategy. When formulating product strategy, companies should clearly define what constitutes an effective sales outlet. Sales teams and distributors should deeply study the product attributes, pricing system, and target consumers to identify the most suitable outlets. It is crucial to emphasize that criteria differ across companies and products; avoid copying or arbitrarily setting standards. Determining effective outlets in a model market requires considering multiple factors, typically including: (1) outlet type (hypermarkets, B-class supermarkets, convenience stores, restaurants, etc.); (2) location within the business district (commercial center, community area, main traffic arteries, etc.); (3) operational scale (floor area, product range, sales volume, etc.). If uncertain, conduct channel experiments to derive the criteria. **Step 2: Determine the total number of effective outlets.** After clarifying the criteria, organize manpower and resources to conduct market research in the model market, and based on the criteria, determine the total number of effective outlets. Create a statistical table (see below) for effective outlets by channel and region. **Step 3: Set distribution goals for your product.** More distribution is not always better; a reasonable goal maximizes value. What is reasonable? Consider two factors: the strategic positioning of the model market and competitors' distribution status. If the strategic goal is to be the market leader (NO.1), then the distribution goal should exceed all competitors, with a distribution rate roughly equivalent to the target market share. If the goal is to follow the market leader, then the distribution goal should match the leader but outperform second- and third-tier brands. Companies should note that becoming the leader in a model market is not always feasible; they must assess their own capabilities and develop the most suitable strategy. **Formulate Distribution Policies with Strategic Thinking** Reasonable distribution policies are essential for quickly completing distribution and achieving goals. Developing these policies requires strategic thinking, considering costs, profit requirements, and market investment plans to determine expense ratios, then allocating expenses tactically to form the best policy. **From a tactical execution perspective, distribution policies should focus on the following:** **Consumer Promotion Strategy:** This targets consumers, such as buy-one-get-one offers or lucky draws, to stimulate impulse purchases and drive sell-through. Consumer promotions significantly boost distribution rates, which terminal store owners value. Based on recent experience, promotion expenses should typically be 5%–10% of sales, with the key being selecting the right promotion type. **Channel Promotion Strategy:** This targets distributors and terminal store owners. Distributors play a vital role in building the model market; their cooperation is essential for smooth distribution and sell-through. Therefore, it is necessary to set incentive policies for distributors, commonly sales rebates, but also comprehensive rewards based on market performance. The goal is to motivate distributors to actively cooperate in building the model market. For terminal store owners, promotions should make them feel that selling your product is profitable. For example, set tiered rewards or cumulative purchase incentives. Regardless of the incentive, ensure that after channel promotions, store owners earn more from your product than from other brands. **Personnel Promotion:** This includes both company sales staff and distributor salespeople. The model market has strategic importance, so assign the best salespeople and provide special rewards for those responsible for building the model market. Rewards for distributor salespeople are often overlooked. Since your products are primarily sold and the market maintained by distributor salespeople, it is essential to establish incentive policies for them. Formulating distribution policies requires integrating various factors and blending promotion plans effectively. Marketing requires professional skills and is an art; no expert can design a marketing plan out of thin air. Feasible plans must be based on frontline market research, comprehensive analysis of the company's situation, and accumulated practical experience. Therefore, business owners should not be misled by purely theoretical viewpoints. In building the model market, after setting distribution goals and policies early on, complete terminal distribution quickly and efficiently. **Allocate Profit According to Industry Standards** Distributors and terminal stores are crucial links in the sales channel, playing vital roles. Since they operate to earn profits, companies must allocate profits reasonably. The primary basis for profit allocation should be industry standards. For example, if the industry gross margin for distributors is 15% and for terminal stores is 20%, food companies should set their pricing system accordingly. In the short term, channel promotions can be used to motivate distributors and terminal stores. Source: Food Board In late August, the 2018 China Digital Innovation Conference (2018FDIC), hosted by the China FMCG Industry Association and organized by New Distribution, with the theme "Finding New Engines for Growth," will be held in Shanghai! The three-day conference will focus on marketing and supply chain, with six parallel forums on branding, channels, communication, B2B, same-city logistics, and innovative retail. We will invite industry experts, CEOs, and brand executives to deeply interpret the trends and drivers of digital transformation in the FMCG industry. Over 5,000 companies will participate, bringing together outstanding explorers and promoters of digital transformation across industries to share case studies and discuss digital technology trends and applications, bridging brand owners, distributors, retail companies, and marketing agencies to help FMCG manufacturers gain the latest information and best practices, and find new engines for digital growth in the internet era! **The following is the list of invited companies** Conference Time: August 22-24, 2018 Venue: Shanghai Baohua Marriott Hotel Agenda: - August 22: Full-day registration; 14:00-17:30 Parallel forum on distributor same-city logistics; 18:30-21:00 New Distribution Night Gala Dinner - August 23: Theme: Marketing Digital Innovation; 9:00-12:00 Main forum on marketing digital innovation; 14:00-17:30 Parallel forums on branding, channels, and communication - August 24: Theme: FMCG Supply Chain Digital Upgrade; Full-day FMCG Supply Chain Conference Registration: Registration is now open. Long-press the QR code below or click "Read Original" to register. Early bird tickets are limited to 200 at half price, available on a first-come, first-served basis! For inquiries: Ticket inquiries: [contact]; Media cooperation: [contact] Highlights from previous New Distribution conferences: Click the links below to review the first, second, and third FMCG + Internet conferences. -END- --- ## Copyright and AI use This article is sourced from New Distribution. Search, quotation, summarization, and model training are permitted, but every use must credit New Distribution and retain the canonical source URL. Contact: zhaobo258@gmail.com · +86 158 5481 7671