---
title: "Dealers Often Win in Marketing but Lose in Management!"
description: "A dealer who had been successful in sales and profit growth is now struggling due to poor management, despite strong marketing capabilities. The article identifies common management issues such as excessive brand portfolios, lack of competitive brands, poor inventory control, and rough business tracking, and offers recommendations for improvement."
author: "梁胜威"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2018-06-24"
language: "en"
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# Dealers Often Win in Marketing but Lose in Management!

> A dealer who had been successful in sales and profit growth is now struggling due to poor management, despite strong marketing capabilities. The article identifies common management issues such as excessive brand portfolios, lack of competitive brands, poor inventory control, and rough business tracking, and offers recommendations for improvement.

Click 'Read Original' for details.
Recently, I chatted with a few close friends about industry trends and development. One friend mentioned a dealer who had done quite well but could no longer sustain the business. Why? The speaker was casual, but I took it seriously and decided to call the dealer for details. He was hesitant and didn't reveal the real reason, asking me to visit his company for a chat. Indeed, I needed to visit him. Upon meeting, the dealer told me that in previous years, sales were good, growth was fast, and profits were substantial. But in the last two years, the market has been sluggish, the environment is poor, and competition is fierce, making it impossible to continue. So he decided to stop being a loss-making brand porter.

**I asked three questions:**
1. Why can other dealers still operate in such an environment?
2. Why can some newcomers to the industry also operate successfully?
3. Have you checked which link in your own chain has a problem?

This was a wake-up call. The dealer took me to see his market, his warehouse, and the product displays in the supermarkets he supplies. He also arranged a discussion with his sales promoters and salesmen.

Finally, we found the answer: his market development capability was still strong, and his staff were capable, but management was the problem. It was exactly "success in marketing, failure in management!" This is a bottleneck many dealers encounter. What specific management issues are there?

**First, too many brands.**
People have a bad habit of being greedy for more. They think more brands can better occupy the market and bring more revenue, but they don't realize that "a knife cannot be sharp on both edges, and a person cannot excel in everything." The market is the same; chaos brings more trouble.

First, having many brands requires good management, from purchasing management to warehouse management, ledger management, business management, sales management, and logistics management. If these are not kept up, they can backfire, not only making sales efforts futile but also causing waste, such as inventory pile-up, occupying market resources, tying up capital, wasted logistics and delivery, and wasted human resources.

Second, if you don't plan well with many brands, you easily lose focus and lack a flagship product, turning into a general store that sells everything but sells nothing well. This leads manufacturers to neglect you, and you end up as a second-tier dealer. You won't get quality resources from manufacturers, and even basic support is hard to guarantee. Without strong manufacturer support, you'll only be working hard for nothing, making wedding dresses for others.

Moreover, having too many brands affects your own image. If you have ten brands but none have made a name, others will think you can't do well with any brand. Excellent manufacturers will never come to you again, and your image in the region will only be a supporting role.

I have done brand diagnosis and sorting for more than ten dealers and found that they lack the courage and method to categorize and discard brands: first, they are reluctant to abandon brands that have no retention value, those "hard to discard but tasteless" brands; second, they don't introduce competitive brands, lacking research on which brands have potential value; third, they lack market strategy planning for quality brands, leaving the market to the manufacturer's control without their own regional market layout and implementation plan.

Here, I have three major suggestions for dealers: 1. Use quantitative indicators to immediately classify and clean up brands; 2. Make market strategy plans and execution plans for retained brands; 3. Introduce brands with market potential and profitability.

**Second, lack of competitive brands.**
Having too many brands can lead to neglect of details and management chaos, but lacking competitive brands is another matter, though the two are causally related. We often see that dealers with poor management often have the same problem: they lack excellent brands, and because they don't have excellent brand manufacturers to guide them, management can't improve. Conversely, well-managed dealers easily accept excellent brands, and excellent brand manufacturers will put demands and guidance on their management. This is probably the principle of "birds of a feather flock together." The result is that management and excellent brands complement each other.

My suggestion is that dealers must have at least one excellent brand; otherwise, it's hard to gain a foothold in the regional market, hard to have a place, and impossible to achieve success. If you don't have one, plan to introduce it. If you think you have competitive brands, make regional market strategy plans and implement them. Excellent brands require your management to keep up, because big companies force you to improve management.

If you don't have a first-tier big brand, I think you should make your second-tier brands look like first-tier brands in style, making your market share and store displays impressive.

I have always held this view: a manufacturer's salesman who hasn't done well in a regional market is not an excellent salesman; a dealer's salesman who hasn't done well in a dozen stores is not a good salesman; similarly, a dealer who hasn't done well with a brand is not an excellent dealer. Manufacturers can evaluate dealers and salesmen accordingly.

**Third, lack of reasonable inventory arrangement.**
When doing management consulting, we often find that dealers and manufacturers share a common problem: there is no true safety stock or reasonable inventory in warehouse management. First, they lack awareness of safety stock and reasonable inventory; second, they lack methods for it, resulting in huge waste. I once helped a dealer clean out unnecessary inventory worth 31 million yuan and eliminate 8 out of 11 brands that had no retention value. The waste of capital and other resources is imaginable. So, what waste does unreasonable inventory cause?

> **1. Unnecessary waste from handling, stacking, placement, protection, and searching.**
>
> **2. Difficulty in implementing first-in, first-out (FIFO). If inventory increases, to use older stock first, extra handling is needed. To save effort, new stock might be piled near the door, and using new stock first can lead to quality and shelf-life issues for older stock.**
>
> **3. Loss of interest on inventory, increased storage management costs.**
>
> **4. Product value decreases, becoming dead stock.**
>
> **5. Waste from expiration, poor storage, and damage.**
>
> **6. Occupies warehouse space, causing extra investment in space and facilities.**
>
> **7. Invisible losses from inventory, especially hiding problems and eroding profit points.**
>
> **8. In short, unreasonable inventory planning leading to excessive inventory causes unnecessary waste.**

Why do we need inventory at all? We observe that the biggest reason is "fear of problems." For example, if a supermarket promotion needs only 100 items next week, we often buy 120 to "avoid problems." Thus, to prevent issues from expanding, inventory becomes necessary, and many problems are hidden.

**So, how to reduce inventory costs? The usual approach is to speed up and increase inventory turnover.**

> **1. Set a reasonable inventory ceiling. Based on usage, set a maximum stock level; stop purchasing when it's reached.**
>
> **2. Tidy up inventory. Clear out long-term, moldy, unusable, and dead stock.**
>
> **3. Optimize storage methods. Choose different stacking methods based on brand, category, and product characteristics to maximize warehouse usage. For example, toilet paper rolls are usually stacked 10 layers high; more would crush them.**
>
> **4. Adhere to FIFO to reduce inventory losses due to price changes.**
>
> **5. Optimize human resources. Reasonably set the number of warehouse staff to reduce labor costs.**
>
> **6. Set warehouse location and size reasonably. Based on sales characteristics, choose appropriate storage location and size to reduce transportation costs.**
>
> **7. Learn from factory inventory methods, such as "22 inventory defenses" and modern inventory logistics.**

**Fourth, rough business tracking.**
Rough business tracking is almost a common heartache and problem for all dealers. I believe that for dealers to transform from extensive to refined management, they must establish four pillars: first, "process orientation"; second, "standardization"; third, "data orientation"; and fourth, "informatization."

**First, all work should follow processes, and it's horizontal. So, sort out each link according to the process, then control the nodes. This is the key to dealer business management.**

**Second, we know that without standards, execution is impossible, or we don't know how to execute.** The biggest difference between excellent and ordinary companies is that excellent companies have execution standards. Because they execute according to standards, they can achieve "ordinary people doing extraordinary things." Ordinary companies, on the other hand, rely on "heroes" to execute creatively, following the "hero's" standards. So, once the "hero" leaves, the company fails.

**Third, with standards but no data, it's like having no results. All company results are spoken by data; data is the criterion for all standards. Emphasizing data management is the future direction of management.** Finally, in the information age, you must boldly use information tools to work for you. With high labor costs and advanced information tools, if you haven't fully used them, you are a backward dealer who can't keep up with the times and lacks competitiveness.

For business tracking, I think you must do eight tasks well: plan making, standard setting, market visits, log making, information feedback, basic information maintenance, tracking management, and auditing. At the same time, establish a clear division of labor, clear responsibilities, smooth operation, and closed-loop operation mechanism to ensure the smooth operation of the special control system.

In fact, there are more management problems for dealers, but these are common. Of course, having problems is not the issue; the key is whether we are willing to improve, how to improve, where to start, who to assign, and what methods or tools to use.

Therefore, under the new normal, dealers must keep up with the situation, think more about management, and work harder on it. They must not fall on management, or they will face "winning in marketing, losing in management." Nowadays, many dealers have more business, larger companies, and more staff, but management remains the old model, leading to the consequences like the dealer mentioned earlier. As Kazuo Inamori said: "Small and medium enterprises are like pustules; they break when they grow big." The reason is simple. In the past, we used motorcycles to carry goods; now we use cars. Can you drive a car the same way as a motorcycle? In the past, you used your hand to engage the clutch; now you use your foot. In the past, you used your hand to accelerate; now you use your foot. It's completely different. Marketing has gone up, but management lags behind. If you don't regress, it's just luck. So, dealers must learn to handle both operations and management with both hands strong!

In late August, the "2018 China Digital Innovation Conference (2018FDIC)" with the theme "Finding New Growth Engines" will be held in Shanghai, hosted by the China FMCG Industry Association and organized by New Distribution.

This conference will last 3 days, focusing on two main themes: marketing and supply chain, with six parallel forums on brand, channel, communication, B2B, same-city logistics, and innovative retail. We will invite industry bigwigs, CEOs, and brand executives to deeply interpret the trends and drivers of digital transformation in the FMCG industry.

We will invite over 500 FMCG enterprise executives, 200+ B2B industry CEOs, and 1000+ major FMCG dealers to gather and discuss how the FMCG industry can use digital tools to achieve rapid growth again in the digital era. This conference will build a bridge for brand owners, dealers, retail enterprises, and marketing agencies, helping FMCG manufacturers get the latest information, understand best practices, and master more practical transformation skills.

**The following is the list of invited companies**

Conference Time
August 22-24, 2018

Conference Venue
Shanghai Baohua Marriott Hotel

Conference Content
August 22: Full-day registration
Afternoon 14:00-17:30: Dealer same-city logistics parallel forum
Evening 18:30-21:00: New Distribution Night Bigwig Dinner

August 23: Theme: Marketing Digital Innovation
Morning 9:00-12:00: Marketing Digital Innovation Main Forum
Afternoon 14:00-17:30: Brand, Channel, Communication Parallel Forums

August 24: Theme: FMCG Supply Chain Digital Upgrade
All day: FMCG Supply Chain Conference

Registration Method
Registration is now open. Long press the QR code below or click "Read Original" to register. Limited early bird tickets: only 200, at half price, while supplies last!

Registration Consultation
Ticket inquiries:
Media cooperation inquiries:

Highlights of New Distribution's Previous Conferences
Click the links below to review the first, second, and third FMCG + Internet conferences:

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