Click the image for details As the saying goes, "It takes ten years to cultivate a shared boat crossing, and a hundred years to cultivate a shared pillow." Though the manufacturer-dealer relationship may not reach the level of 'shared pillow,' it should at least require decades more than 'shared boat.' In the journey of mutual support, it would be wonderful if manufacturers and dealers could remind and support each other at critical moments, becoming happy partners.

With intensifying competition in the business environment, the marketing awareness of moving the terminal one meter forward and extending promotions to residential communities has taken root in the minds of most dealers. Some dealers have attended more training, seen more of the world, and understand more big principles than the enterprises themselves. But what pains enterprises is that although dealers seem to understand the logic, when it comes to actual action, many dealers make a lot of noise but little rain, or only thunder without rain, and some even don't make a sound.

This leads to a common problem in our daily dealer services: the principle that marketing creates more sales opportunities is understood by dealers, but why don't they act?

Every household has its own hard-to-recite scripture, and one key cannot open all locks. The thorny issue of dealers understanding but not acting has multiple causes and requires tailored solutions.

01

The 'Don't Know How' Type:

They know they should promote outside the store and attract customers, but don't know where to start.

Actually, the proportion of dealers who completely don't know how to do outside promotion and traffic generation is getting smaller. Most dealers know the general methods, but because they've heard about it from the sidelines or have dabbled in it themselves, they feel the effect isn't that great. So they stop and wait for manufacturers or experts to teach them a one-hit-wonder secret technique, planning to try it once they learn it. But many dealers wait until their stores close down without ever finding someone to teach them that magic move.

We often say that a third-rate plan with first-rate execution can achieve second-rate results. Especially today, consumers have developed strong immunity to various flashy promotional formats. Creating a groundbreaking promotion plan that is low-cost and high-return is like finding a needle in a haystack, requiring both inspiration and timing. So when a promotion plan lacks explosiveness and strong spreadability, it needs to be compensated by another aspect—systematicness.

For example, we all recognize that when we say someone's thinking is impressive, it either means their depth of thought reaches levels we haven't touched, or their breadth of thinking shows systematic consideration of a problem, leaving nothing out and being orderly. The essence of designing a promotion plan lies in this.

Most dealers know that buy-one-get-one-free offers are becoming less effective, but almost no dealer knows that an event from initial water storage to final return has over twenty links and steps that can be designed and controlled to expand the customer base and increase the probability of closing deals. I once tested in a class that dealers who knew eight or more control points in event design were rare. In actual operation, controlling one more link increases the chance of closing a deal, and most links and procedures can be designed without extra cost. Whether an event can systematically consider all these twenty-plus links and intervene effectively is the key to turning an ordinary promotion into a winning hand.

For dealers who don't know how, what enterprises need to do is simply two words: invest people.

Enterprise personnel should lead by example, take dealers by the hand, set benchmarks and models. Guide dealers through the four stages of "you listen to me, you watch me do, I listen to you, I watch you do". Break down dealers' fear of difficulty, shatter their unrealistic fantasies, and let results and numbers speak. Let dealers see that doing promotion and execution solidly and systematically can also make every event packed.

02

The 'Dare Not' Type:

They know how to do it but feel the risk is uncertain.

Dealers who dare not act usually feel that the input-output ratio is not worth it. The most critical thing is that this risk is a feeling for dealers—indescribable yet wonderful. If enterprises probe deeply, dealers tend to be evasive, with shifting eyes and a demeanor of changing the subject. After some tai chi, you still can't find the root.

There's a simple way to judge if a dealer belongs to this category: discuss the promotion plan with them. You'll find that among various promotional actions, this type of dealer prefers actions where customers come to the store, like referral programs. Their interest in other customer acquisition actions is noticeably lower. This can be considered a key characteristic of the 'dare not' type.

For dealers who dare not act, the enterprise's strategy is still two words: invest money.

A large promotional event has over twenty links and steps that can be controlled, each with different costs and effects varying by time, place, and people. Some links only require adjusting actions without cost, like changing the target of invitations, which only involves script adjustments and doesn't significantly increase costs. But some links, like the return visit, require giving consumers extra sweeteners to be effective.

When dealers are uncertain about the results of cost investment in certain links, enterprises should share the cost with them. On one hand, this tests the effectiveness and appropriate intensity of actions, building a data foundation for future events. On the other hand, it helps dealers build a systematic understanding of events, using money to help them gain intuitive knowledge of key steps. This is truly spending money where it counts.

03

The 'Unwilling' Type:

They know how to do it and have some risk tolerance, but they don't think it's necessary.

Unwilling dealers can be roughly divided into two categories. One is where the industry is mature, the enterprise has grown, and the dealer has a certain scale—so-called 'money makes you bad.' Because of this, dealers start having more choices, like speculating in real estate or investing, and are no longer willing to earn hard-earned money. The other is in emerging industries or categories where the enterprise is growing rapidly, and dealers have sufficient channel profits, so business is too busy to handle, or it's a case of 'no business for three years, but one deal feeds for three years.' Such dealers have neither the will nor the motivation to do outside promotion.

When such dealers appear, the cause often lies with the enterprise itself. For example, in channel profit distribution, some enterprises adopt so-called 'bare prices' to quickly expand the market, packaging the regional market to dealers and then not caring about what happens, or lacking resources to mobilize dealers to do what they want. This is common among small and medium enterprises in rapidly developing industries.

Or the enterprise keeps its eyes on the market but ignores bottlenecks in backend supply capacity. If normal shipping is already as painful as constipation, and during large events, goods haven't been shipped after three months, how can dealers have the motivation to run events? If you ask the boss why they don't keep some inventory, they confidently say: 'We aim for zero inventory.' This is a key reason why many SMEs in emerging industries fail to seize development opportunities. Of course, we won't discuss the pros and cons of zero inventory today; I just want to say that many enterprises in high-growth industries are not fully prepared.

For unwilling dealers, solving this problem is more complex and may require re-examining the marketing and supply systems, especially the pricing and supply chain systems.

Generally, my experience is that in emerging industries and categories, the gross margin should be at least over 50% to have the momentum and resources to support rapid industry advancement. If enterprises blindly engage in price wars instead of transferring sufficient profits to improve products and services to grow the industry and raise barriers, such industries struggle to grow, and such enterprises are likely to fail.

04

The 'Cannot Do' Type:

They know how to do it, are willing to take risks, and see the necessity of outside promotion, but their manpower structure can't support it.

I once did an incomplete statistic that at least half of dealers face the problem of retaining core personnel. The issue here is that the dealer's platform is not large, and even with a certain sales volume, it's hard to completely erase the shadow of being a middleman. Capable people are hard to recruit, and after painstakingly cultivating a core person, they worry: Will I speak too harshly? Will I pay too little? Will I put too much pressure? They fear the core person will push back and leave. For core personnel, if they usually perform at 80%, they turn a blind eye and say 'Amitabha.' In the end, they comfort themselves, saying they need to be tolerant and use people's strengths. Being a dealer boss is as stressful as being the Premier of the State Council. Of course, I'm not mocking dealers but expressing the real predicament most dealers face.

Running promotional activities, especially large-scale ones, is like high-intensity cross-country training in a short period, requiring stronger execution than usual. Whether each action and link is done properly directly or indirectly affects the final result. Most dealers don't separate sales and promotion personnel, partly for cost reasons and partly because it's unnecessary. When activities are periodic or temporary, having a dedicated promotion team is redundant. But precisely because promotion and sales functions aren't separated, it's easy for the salespeople who lead the charge to not perform actions properly during promotion, and even if dealers notice, they let it slide. Especially when dealers feel the pressure of work requirements exceeds the compensation paid to salespeople, problems like deformed actions, non-standard procedures, and leaks multiply.

So many dealers, when faced with an event, first weigh whether they have enough manpower. If no one can fully execute the plan, it's better to maintain the status quo and avoid turning the event into chaos and losing more than gaining.

Of course, for dealers who cannot do, the solution must start from the root and be addressed through institutional design.

Actually, many dealers have the idea of turning core backbone personnel into shareholders, but they lack clear plans and actions in specific methods and steps, and many just pay lip service. What enterprises should do is follow this trend, turning individual dealer plans into company-wide plans in terms of policy and resource investment, giving core personnel a sense of purpose, and allowing dealers to maximize and prolong the 'exploitation' of core personnel's surplus value. In my consulting work, I've proposed the '老板娘计划' (Boss's Wife Plan) and '老板计划' (Boss Plan), which have been effective, aiming to solve the 'cannot do' problem.

New Distribution will hold the 2019 (5th) FMCG + Internet Conference during the Chengdu Spring Sugar and Wine Fair from March 15-18. This conference will focus on the topic of 'Breaking the Game' and engage in in-depth discussions with numerous brand owners, supply chain service providers, dealers, retailers, and others.

Compared to previous conferences, this summit will be fully upgraded. In addition to original topics like channel innovation, city distribution logistics, and dealer transformation, it will add parallel forums on new marketing cases, IP + FMCG empowerment, community group buying, and innovative retail. Through three days of ten high-density, high-quality expert sharing sessions, we believe every brand owner and dealer can learn the latest business models, expert insights, and actionable methods, finding new tools and methods to break the game in 2019 and return to high-speed growth.

Review of Previous Conferences

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