Introduction: The more outstanding peers you see, the easier it is to locate your coordinates, judge your current position, and know where you might go next.
Over the past year, I have visited many dealers, including some extremely successful large operators, but the majority of dealers, overall, are not in a good business state. Upstream suppliers push inventory aggressively, downstream customers delay payments, and the brands they represent change frequently. With annual business of tens of millions, at year-end, profits are minimal. They want to improve but find it hard to maintain the status quo; they want to transform but have no idea where to start. The state of these dealers can be summed up in one sentence: they are trapped in place—not knowing where they are or where to go next. Some have given up, but most still want to change. The question is: how? In a previous article, I posed this question: In the next five years, which type of dealer will win? My answer was simple: The future performance of a dealer depends on the boss's depth, height, and strength! Depth means deep thinking. Dealer bosses must rely on business rationality rather than emotion and primitive business cognition, making decisions based on logic and causality. Height refers to whether you can rise above the present, gain insight into industry trends from a higher level, see the present from the future, adjust current business, and plan for the future. Strength is about leveraging team leverage to seize business opportunities, with the core being designing mechanisms that align rights, responsibilities, and benefits, and cultivating and attracting talent. A friend bluntly told me that such a summary, while simple and clear, offers little practical guidance for dealer bosses because they still don't know what to do! Is there a simple, direct, and immediately actionable way? After careful thought, I believe there is: the answer is learning, specifically learning from peers!
I believe the value of peer learning is underestimated by many. Business is practice, and the experience of industry practitioners is knowledge. Since we are peers, our businesses are interconnected. The problems you ponder may already have good solutions from others. Learning from experience and knowledge is a key value of peer learning. But it doesn't stop there. For many dealer bosses today, peer learning has an even more significant meaning: finding your reference system. What does that mean?
Let me share a personal experience. In 1998, I took the high school entrance exam and ranked first in my town. That year, I entered a provincial key high school, the only student from my town admitted. After entering high school, I realized there was always someone better. Although I was first in my town, I ranked 19th in my class—compared citywide, my scores were nothing special. In the first semester of my freshman year, my grades were roughly the same as my entrance ranking. So I observed those ahead of me, especially the top two students, to see what they did better. With a reference, I knew where to focus, and my grades quickly improved. Throughout high school, my grades were stable, usually in the top two of my class. In 2001, I took the college entrance exam, and a similar situation occurred. My classmates came from nearly 20 provinces, and most had higher admission score lines than my province, so I was again a laggard. But just like in high school, once I had benchmarks and references, I quickly caught up, and my grades remained at the top of my class throughout university. Why am I telling this? Not to boast about my academic performance, but to share a principle: In this world, we determine our position through a reference system.
Why is peer learning important? Because it provides a reference system. I have a metaphor: we all live in a jungle, and our vision only extends about 1 kilometer around us. We don't know where we are or where to go. What to do? Find reference points: the sun, big trees, mountains. In reality, those who do much better than you are your references. With them, you know how well you are doing, where you stand, and where you can go next. You might say this applies to individuals, but does it apply to dealer bosses' businesses? Yes.
When interviewing excellent dealers, I often ask: What prompted you to make such changes? The answers are basically the same: a love of learning. Last month, I visited a dealer who followed New Distribution's e-commerce study tours in 2018. She said that opportunity allowed her to see the practices of outstanding peers, broadened her horizons, and she consciously re-examined and understood her business, adjusting and changing. In recent years, her business has grown continuously, from less than 30 million to over 100 million in a third- or fourth-tier prefecture-level city. In fact, many dealers have grown by learning with New Distribution, understanding new models, meeting peer experts, seeing more possibilities, and knowing where to improve. The more outstanding peers you see, the easier it is to locate your coordinates, judge your current position, and know where you might go next. We often say that the boss's cognition determines the company's ceiling. Cognition is essentially knowing where you are now and where you can go. Where does cognition come from? Cognition first comes from changing your information environment. A person's information environment consists of the information they receive, the people they contact, and the circles for deep communication. If you interact with the same people daily and receive homogeneous information, it's hard to see the outside world, and your thinking is hard to open—you don't know that the problems you rack your brains over have already been solved by others; the models you just heard about may already be thriving among your peers! In the past few years, we've seen a few dealers do better and better, while most just repeat at a low level, trapped in place, and some have even gone under. This is not surprising; excellent dealers are always in the minority. Because cognition follows a power-law distribution. What does that mean? In a population, extremely smart and extremely stupid people are rare; most are in the middle, and everyone is similar—IQ follows a normal distribution. Cognition is different; it comes more from后天 training. Those with high cognition are a minority, while most people's cognition is at a low or medium level—cognition follows a power-law distribution. So, in any field, experts are always a minority. This is a universal law. Since experts are few, and the majority of dealer bosses urgently need to change their information environment, we have been thinking: Can we gather industry experts to form a communication circle where everyone learns from each other and improves together, and also allow those dealer bosses who want to change but don't know where to start to progress together? This is also a demand expressed by many dealer bosses when we visit them.
Over the past six months, we have been planning a dealer membership club. We hope to leverage New Distribution's ability to connect and distill, bringing together expert dealer bosses from across the country, and providing the latest business opportunities and dividends, excellent cases of business growth, and effective cost-reduction guides to the vast number of dealer friends. But it doesn't stop there. As industry observers, New Distribution has been reporting on excellent dealer cases and also observing industry trends. Over the past 30 years, in China's FMCG channel value chain, dealers have been severely disadvantaged:
1. Survival squeeze — squeezed by both upstream brands and downstream terminals, with living space continuously compressed. 2. Value deficiency — contributing to brand sales but unable to share the high premium that brand development brings to manufacturers. 3. Passive choice — regional segmentation, agency rights cancellation, no market control, only waiting to be chosen. 4. Thin profits — limited gross margins, high costs, not making money or even on the edge of losses.
Dealer bosses must feel these problems deeply. Of course, in the past few years, we have also seen more and more excellent dealers rising, starting to take the initiative in market competition and games. The role of dealers has changed! Powerful dealers have transformed from "salary-earning" brand outsource teams to enterprises that serve customers well and monetize scarce resources into "profits." They are beginning to control their own destiny and will eventually lead the transformation of the trade and distribution industry. How do these excellent peers think? What do they do? What transformations have they experienced, and what judgments and plans do they have for the future? Their perspectives and thinking are truly worth learning from for the vast majority of dealer bosses. The New Distribution Dealer Membership Club brings together 500 excellent dealer bosses from across the country to create a community for the evolution of dealer bosses' businesses. Membership recruitment has started, and it will officially launch in June 2023. If your business is facing challenges and you've been going in circles, welcome to join the Dealer Membership Club. Seize the opportunity, reduce costs, and increase growth. Here, you can find suitable learning targets and path references! If you are doing exceptionally well in your region and have insights into management, we welcome you even more. Walk with experts, learn from each other, and progress together to become future leaders in the FMCG trade industry!
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