Preface & Overview
I. Why Choose the Topic of "Dealer Management"
- Cooling Down the "Supermarket Fever" in the Marketing Circle
How to "enter hypermarkets" has become a hot topic in the daily consumer goods marketing circle, and it has become somewhat overheated. It seems that hypermarkets have become the top priority for daily consumer goods companies' marketing efforts. This kind of rhetoric and trend can easily mislead companies. Especially for small and medium-sized enterprises, with insufficient product strength, inadequate advertising support, and uneven wholesale channel prices across the country, blindly entering supermarkets comprehensively often leads to failure or injury—some are forced to withdraw midway due to the pressure of various supermarket fees and elimination rules; others, due to the price linkage effect among large supermarkets, disrupt the price system of the entire wholesale channel, making it impossible for wholesale channels to ship goods, and even causing the entire market to collapse.
Undoubtedly, supermarkets are the future trend and a window for product image, and they should not be underestimated. However, currently, supermarkets are only truly mainstream channels in a few larger cities. In most northern cities and second- and third-tier cities, retail sales are still concentrated in small retail stores, wholesalers, and dealers. From a national market perspective, the mainstream channel is definitely not supermarkets; sales still rely on dealers, wholesalers, and retail stores.
- The Importance, Urgency, and Complexity of Dealer Management
· The Importance of Dealer Management
An indisputable fact is that most domestic enterprises have not widely established branch offices in the strict sense (with finance, warehousing, and sales functions), and more than 90% of sales are completed through dealers, with the proportion of direct sales by manufacturers being extremely small.
Why is China's distribution channel so powerful?
Due to constraints from economic, cultural, and commercial mechanisms, domestic consumers are not mature or rational enough, have low brand loyalty, and are easily influenced by hype—whatever is popular in the market (actually what merchants are promoting) they buy! The iron rule of daily consumer goods marketing in China is, first, to quickly achieve a visually stunning distribution rate—creating a fashionable atmosphere; second, to maintain this distribution rate and sustain the trend.
China has a vast territory, and road transportation costs are high. The truly affluent consumer groups are not concentrated, per capita purchase volume is small, and large-scale outlets like supermarkets and hypermarkets are far from universal. A significant portion of sales comes from tens of millions of small retail stores. The domestic retail channel has unique characteristics: retired elderly people open the window of their first-floor balcony, hang up a sign, and that becomes a point of sale. A city with a population of four to five million can have more than 20,000 retail stores.
Relying on the manufacturer's own strength to distribute to so many points and maintain logistics would be a financial disaster. Without the active participation of dealers and sub-dealers at all levels, manufacturers cannot create or sustain trends!
To establish a foothold in the market, manufacturers must distribute products through dealers and wholesalers to expand product coverage. The ability to effectively manage dealers and mobilize the enthusiasm of dealers at all levels largely determines whether the enterprise can survive—in China, the power of the distribution channel cannot be ignored, cannot be stopped, and cannot be replaced!
· The Urgency and Complexity of Dealer Management
The issue of dealer management is extremely urgent—it is no exaggeration to say: as the dealer, so is the market!
With the same product, same price, same advertising investment, and even basically similar market environment, Dealer A can make the market thrive, while in Dealer B's territory, it may be a complete failure.
Change dealers? It's not that easy. Once you cooperate with a dealer for a period and then find that his various "misdeeds" are uncontrollable and you want to replace him, it is often accompanied by rampant cross-regional dumping, price undercutting, price inversion, abnormal accounts receivable, and a large amount of near-expiry products in the channel. At this point, if you want to replace the old dealer and rebuild the market, you will find that saving a market that has been messed up is harder than starting ten new markets.
· Dealer Management Issues Are Also Very Complex
For example: dealers with strong strength often pay insufficient attention to the product and have poor willingness to cooperate; dealers with weak strength have better willingness to cooperate, but their network and transportation capacity are insufficient, restricting your market development; manufacturers give concessions to dealers to increase their enthusiasm, but dealers undercut prices; tiered dealer policies (higher rebates for higher sales) can cause large dealers to squeeze small dealers (large dealers have high sales, high rebates, and low base prices), while a one-size-fits-all policy that treats large and small dealers equally can reduce the enthusiasm of large dealers, and even cause small dealers to eat large dealers (small dealers have lower operating costs)...
- Enterprises Need Self-Reflection in Dealer Management
Many companies complain that "domestic dealers have low quality, severe disorderly competition, and dealers bully manufacturers." In reality, these companies most need self-reflection.
※ Do you select dealers based on established criteria and careful investigation, or do you accept anyone with money to buy goods? ※ Does your dealer policy avoid the pitfall of "high sales get high rebates"? ※ Can you regularly grasp the inventory of dealers in various regions? ※ Do you understand the distribution networks and selling prices of dealers in various regions? ※ Have your employees received training on how to effectively manage dealers? ※ ...
If you answer "no" to these basic literacy questions, then the conclusion is not that dealers are difficult to manage, but that you manage them too sloppily.
Dealer management is urgent and important—every enterprise knows this, but it is not enough to just pay lip service. Enterprises must truly make efforts in employee skill training, dealer policy formulation, and control over dealer inventory, prices, and distribution networks.
Dealer management is complex, but upon closer examination, it is not that "Chinese dealers are difficult to deal with," as many companies complain, but rather that the manufacturer's dealer management work is not solid enough!
II. Overall Structure and Approach of the Dealer Management Action Breakdown Marketing Training Course
"Dealer Management Action Breakdown Marketing Training Material" is originally written by the author based on over ten years of sales practice experience in well-known foreign/domestic enterprises. On this topic, training has been provided to marketing teams of nearly a hundred enterprises. Many dealers have also participated in training sessions at various companies, and they can also gain skills and methods for market management and manufacturer-dealer relationship handling. The specific approach and modules of this course are as follows:
- Theoretical Education: Establish Correct Concepts: Correctly View the Relationship Between Manufacturers and Dealers
Marketing media constantly shouts: manufacturers and dealers are like fish and water, a win-win relationship; most sales personnel also think that the more alcohol consumed, the higher the sales, and the better the relationship, the higher the sales. Managing dealers is just about building relationships, and the "skill" of a sales representative is reflected in whether they can build personal relationships with dealers.
In reality, those who truly understand sales know that the relationship between manufacturers and dealers is not as simple and lovely as fish and water. Precisely because of these one-sided views, many sales representatives, during dealer visits, chat idly about everything under the sun—building rapport—but never discuss how to operate the market; when dealers undercut prices, dump goods across regions, or intercept promotions, sales representatives dare not "manage" them—fearing that offending the "God" will lose sales, ultimately leading to the market initiative completely controlled by the dealer...
Concepts determine behavior. Dealer management training for sales personnel must start with correcting concepts, helping trainees understand the essence of the manufacturer-dealer relationship and their role as a sales representative. The specific content revolves around the following points:
· Is the relationship between distributors/dealers and manufacturers really as simple as fish and water? · The role of distributors/dealers to manufacturers: what are the benefits? What are the drawbacks? · Correctly understand distributors/dealers; understand the essence of the relationship between distributors/dealers and manufacturers; · The correct approach to dealer management: what kind of sales representative can claim "I manage my dealers very well"?
- Overall Approach, Standards, Action Breakdown, and Action Process for Dealer Selection:
The best way to solve a problem is to prevent it from happening. To effectively manage dealers, you must first learn how to scientifically select dealers.
A. Approach to Dealer Selection
Selecting a dealer is not about choosing the biggest; it requires comprehensive consideration. Not only must you examine their strength, but also whether they have strong willingness to cooperate, business reputation, word-of-mouth, terminal network, marketing awareness, and other comprehensive indicators.
B. Action Breakdown for Dealer Selection
The essence of manufacturer-dealer relations and dealer selection approach are all general theoretical education. Trainees find it interesting, but most still don't know how to act. So the next step is to extend theoretical education downward into practical scenario education and implement it into action breakdown—telling sales representatives how to investigate indicators such as dealer strength and marketing awareness in actual work. Each major indicator can be broken down into multiple sub-indicators. Through those actions—what questions to ask, which areas to visit, what phenomena to observe, what data to collect, how to ask questions, how to visit...—the evaluation of the above indicators can be implemented one by one.
C. Guide Sales Representatives' Attention in the Correct Direction
Knowing is not doing. People's thinking has inertia. After memorizing a bellyful of approaches, actions, and standards, sales representatives are still prone to follow past thinking habits and find a big customer when they go to the market. So it is necessary to establish a customer evaluation model, allowing sales representatives to use this model as a tool to evaluate and score candidate customers. This guides the thinking and attention of sales representatives, unconsciously developing toward the standards and actions mentioned earlier. How to establish the evaluation model, its main content, usage methods, and precautions must also be gradually implemented into actions.
D. Action Process Gives Sales Representatives a More Perceptual Understanding
Now that sales representatives understand the approach, standards, actions, and evaluation tools for dealer selection, can they definitely scientifically find dealers? Not necessarily. When they arrive at an unfamiliar market, facing so many people and vehicles, not knowing the local dialect, not knowing where the wholesale market is, they will become dizzy and confused, like a tiger trying to eat the sky, not knowing where to start, with a bellyful of knowledge but not knowing how to use it. So it is necessary to give sales representatives a work process. Tell them what to do first, what to do next, and what to do after that when they get off the car in an unfamiliar market. Like performing a play, show them "how to use the learned knowledge to screen dealers according to the action process in an unfamiliar city."
- How to Promote the Cooperation Willingness of Prospective Dealers
Now, has the dealer been selected? Before the formal contract is signed, it is only the manufacturer's wishful thinking, at most it can be called a "prospective dealer." In real work, it is often not only you choosing the customer, but more often the customer choosing you. Some customers have good conditions in all aspects, but they are not interested in operating your product. So how to stimulate the customer's willingness to cooperate becomes the final and difficult issue in dealer selection. Therefore, it is necessary to teach employees how to negotiate with customers and stimulate cooperation willingness: how to analyze the customer's mindset, what preparations to make before negotiation, what environment to choose during negotiation, when to remain silent, when to state opinions, what to say in the first sentence, what are the common doubts and objections of dealers, when to refute, how to refute, etc. Ultimately, dispel customer doubts and conclude the dealer selection work.
- Action Breakdown and Action Process for Daily Dealer Visits
When sales representatives deal with new dealers, they have to introduce products, explain policies... In short, there are many topics to talk about. Once a new dealer has been selected and the new market development is completed, the new dealer becomes an old customer. Old customers are familiar with the company's products and policies. What to say during periodic visits to old customers becomes a problem.
Sales representatives visiting dealers in outlying markets take a long-distance bus in the morning, return in the evening, and have lunch in between. The effective working time in a day is actually no more than four hours. In this limited working time, if the company cannot give sales representatives a clear sense of direction—what to do first, what to do next, and what to do after when visiting dealers—then sales representatives will meet dealers and say the same three old sentences: "How are sales? When will you pay the last amount? This time, for every hundred boxes, you get one free, how many do you want?" Then they start chatting and building personal relationships, doing no real market-building work. Such dealer visits are like "visiting relatives."
In fact, it's not that sales representatives are lazy; they also don't know what they should do when visiting dealers.
The salary paid by the company is limited. To recruit first-class sales representatives, relying on a bit of corporate culture and business philosophy infusion to create their own work approach is unlikely! The company must tell them specifically what actions to take.
For example, lift your foot, extend it forward, step down—that's called taking a step!
Sales representatives learn that there are 9 things/12 actions to do when visiting dealers, know what to do first after getting off the car, what to do next, what actions to take in the first ten minutes, what actions in the second ten minutes... what to say in the first sentence when meeting the dealer, what are the ten most common questions dealers ask, and how to respond? With a clear sense of direction, sales representatives' work will be more effective.
- Corporate Behaviors' Impact on Dealer Management
Dealer management is not only reflected at the operational level. The company's year-end rebate policies, sales incentive policies, accounts receivable policies, dealer conferences, and performance analysis systems that serve as early warnings for the health of the dealer network... These institutionalized corporate behaviors also play a crucial role in dealer management. This section mainly focuses on the following points for training.
· How to formulate distributor/dealer contracts—example analysis; · How to control credit sales accounts for distributors/dealers—explanation of basic control points; · How to formulate sales incentive policies for distributors/dealers—example analysis; · How to handle conflicts among distributors/dealers—action breakdown; · How to establish an early warning system to monitor the uniformity and effectiveness of the dealer network at all times;
- How to Solve the "Common Marketing Deadlocks" Faced in Dealer Management?
In daily work, should we manage dealers well to prevent cross-regional dumping as much as possible? Absolutely right, but dumping has already occurred in many places! Should we pay attention to controlling the intensity of terminal promotions to prevent supermarkets from undercutting prices? Correct, but vicious special offers in supermarkets frequently occur!
For such marketing deadlock problems, what trainees expect to learn is definitely not "how to set prices reasonably to prevent problems"—that's hindsight preaching. They want to know: since it's already like this, what should we do?!
The practicality of training content is often reflected in this link—you can't just fire after the event. Not only should you talk about what should be done correctly, but also how to remedy past mistakes. Facing a deadlock and how to solve it often concerns the immediate interests of the enterprise, and the demand is more urgent, and employees are more concerned.
In this section, the author, drawing on years of practical experience and materials collected from training, Q&A, and interactive discussions with nearly a hundred enterprises, proposes solutions and specific actions for more than 50 common typical market deadlocks and operational details, such as "big customers bullying manufacturers," "cross-regional dumping," "price undercutting," "customers embezzling promotional profits," "how to establish and manage a professional dealer team for supermarket channels," "how to operate outlying markets to impact distribution," etc.
In summary, the overall approach of the "Dealer Management Action Breakdown Marketing Training" course is as follows:
In this way, layer by layer, peeling the silk, close to the actual work scenarios of sales personnel, and implemented into action breakdown. Only then will the training content be easier for trainees to absorb, allowing them to "learn and immediately use," thus having more practical effect. Only then is empty theoretical education truly implemented.
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