---
title: "Distributors Often Win in Marketing, Lose in Management!"
description: "A distributor who once performed well in sales is now struggling due to poor management, despite strong marketing capabilities. The article identifies common management pitfalls such as excessive brand portfolios, lack of competitive brands, poor inventory control, inaccurate records, and loose business tracking, offering practical advice for improvement."
author: "梁胜威"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2017-02-02"
language: "en"
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# Distributors Often Win in Marketing, Lose in Management!

> A distributor who once performed well in sales is now struggling due to poor management, despite strong marketing capabilities. The article identifies common management pitfalls such as excessive brand portfolios, lack of competitive brands, poor inventory control, inaccurate records, and loose business tracking, offering practical advice for improvement.

**Click to read the original article for details**
Recently, I chatted with a few close friends in the tissue paper industry about trends and development. One friend mentioned a distributor who had done quite well but now couldn't continue his business. Why? The speaker didn't mean much by it, but I took it to heart and decided to call the distributor to ask for details. He was hesitant and didn't reveal the real reason, asking me to visit his company for a chat. Honestly, both emotionally and logically, I needed to visit. When we met, the distributor told me that in previous years sales were good, performance grew fast, and profits were substantial. But in the last two years, the market has been sluggish, the overall environment is poor, and competition is fierce. The year before last, he could barely manage, but especially since last year, product prices have kept dropping—now to 8,000 yuan per ton—making it impossible to continue. So he decided to stop being a brand porter who loses money.

I asked three questions:
1. Why can other distributors still operate in such an environment?
2. Why can some new entrants to the industry also operate?
3. Have you checked where the problem lies in your own operations?

That was an eye-opener. The distributor took me to see his market, his warehouse, and the product displays in the supermarkets he supplies, and also had 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 the problem was in management. It's exactly "winning in marketing, losing in management!" This is also a bottleneck many distributors face. So what management issues are these?**

**First, too many brands**
People have the bad habit of wanting more, thinking that more brands can better occupy the market and bring more revenue. But they don't realize that you can't sharpen both ends of a needle, and no one can 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 management aspects lag or are poorly done, they often backfire, not only making sales efforts futile but also causing waste, such as inventory pile-up waste, waste of market resources, waste of capital, waste of logistics back-and-forth delivery, and waste of human resources.

**Second, if you have many brands but don't plan well, you easily lose focus and lack a flagship product, eventually turning into a general store that sells everything but sells nothing well.** This results in manufacturers not taking you seriously, and you end up as a second-tier distributor, not even getting basic support, let alone quality resources. Without strong manufacturer support, you'll only be working hard for nothing, making wedding dresses for others.

**Also, having too many brands affects your own image. If you have ten brands but none of them make a name, others will think you can't do brands well.** Excellent manufacturers will never come to you again, and your image in the region can only be a supporting role or a foil.

I have done brand diagnostics and sorting for more than ten distributors and found that these distributors lack the courage and method to categorize and discard brands: **First, they are reluctant to discard brands with no retention value, unable to let go of those that are "a pity to discard but tasteless to keep"; second, they don't introduce competitive brands, lack research on brand selection, and are unclear about which brands have potential value; third, they lack market strategy planning for quality brands, leaving the market to the manufacturer's discretion without their own regional market layout and implementation plan.**

Here, I have three major suggestions for distributors: **1. Use quantitative indicators to immediately categorize 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 leaves no time for details, leading to management chaos, and lacking competitive brands is another matter, but the two are causally related. We often see that distributors with poor management often have the same problem: lack of excellent brands, and because they don't have excellent brand manufacturers to guide them, management can't improve; conversely, distributors with good management easily accept excellent brands, and excellent brand manufacturers will put forward requirements and guidance for 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 and bring out the best in each other.

**My suggestion is that a distributor 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 anything in the region.** If you don't have an excellent brand now, plan to introduce one; 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 in management.

**If you don't have a first-tier major brand, I think you should make the second-tier brands you have in hand look like first-tier brands, making your market share or display in stores impressive.** I've always held this view: a manufacturer's salesperson who hasn't done well in a regional market is not an excellent salesperson; a distributor's salesperson who hasn't done well in a dozen stores is not a good salesperson; similarly, a distributor who hasn't done well with a brand is not an excellent distributor. Manufacturers can evaluate distributors and salespeople by this principle.

**Third, lack of reasonable inventory arrangement**
When doing management consulting, we often find that distributors and manufacturers share a common problem: there is no true safety stock or reasonable inventory in warehouse management. **First, there is no awareness of safety stock and reasonable inventory; second, there are no methods for safety stock and reasonable inventory, resulting in huge waste.** I once helped a distributor clean up 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. It causes unnecessary waste in handling, stacking, placement, protective treatment, and searching.**
>
> **2. It makes first-in-first-out operations difficult. For example, if inventory increases, to use the goods that arrived first, extra handling is required. And if you want to save trouble, new goods might be stacked near the door, and you use the new goods first, while the old goods may face quality and shelf-life issues over time.**
>
> **3. It loses inventory interest and increases storage management costs.**
>
> **4. The value of goods decreases, becoming dead stock.**
>
> **5. Waste due to expiration dates, poor storage, etc., causes inventory damage.**
>
> **6. It occupies warehouse space, causing waste in extra space and warehouse investment.**
>
> **7. The intangible loss caused by inventory, especially hiding problems, erodes profit points.**
>
> **8. In short, without reasonable inventory planning, 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 the supermarket needs only 100 items for next week's promotion, we often purchase 120 to "avoid problems." So to prevent the impact 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 the turnover rate of inventory goods.**

> **1. Set a reasonable inventory ceiling, based on usage, and stop purchasing when the maximum is reached.**
>
> **2. Rectify inventory, clear out long-term, moldy, unusable, and other dead stock.**
>
> **3. Optimize storage methods, choosing 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; beyond that, they get crushed and deformed.**
>
> **4. Adhere to the first-in-first-out method to reduce inventory losses due to price changes.**
>
> **5. Optimize human resources, reasonably set the number of warehouse management personnel, and reduce labor costs.**
>
> **6. Set warehouse location and size reasonably, based on sales characteristics, to reduce transportation costs.**
>
> **7. Learn more from factory inventory methods, such as "inventory 22 defenses" and modern inventory logistics.**

**Fourth, inaccurate warehouse accounts, cards, and items**
Because inventory management is not in place, the accounts, cards, and items can never be accurate, and without accuracy, costs cannot be reduced, and management cannot get on track. Many distributors think that introducing an inventory management system can ensure accuracy, but that's not the case. The key is to rely on accurate basic data from management to effectively use the software system. You must know that all software systems are man-made tools; without human management as the foundation, data can never be accurate, unless you have fully automated, intelligent, robotic operations that can achieve 100% accuracy measured in seconds and pieces. But currently, few domestic distributors operate this way.

**Therefore, I suggest distributors return to focusing on basic warehouse management.**

**1. Establish a "Warehouse Operation Manual" in the warehouse and incorporate results into performance appraisals, so that warehouse keepers are aware of the importance of consistency among accounts, cards, and items from both institutional and ideological perspectives.**

**2. Based on the actual warehouse situation, formulate standard manuals and inbound/outbound flow charts to ensure consistency from the process. I once required a warehouse keeper at a distributor to first draw a floor plan of item placement, then type it out on the computer, memorizing the location, approximate quantity, and stacking method of each item.**

**3. Implement regular cycle counts, daily counts, weekly counts, or monthly counts. Inventory counts can promptly identify discrepancies. Analyzing discrepancies helps find causes and prevent recurrence. Counting is the most direct and effective way to ensure warehouse accounts, cards, and items match.**

**4. For receiving and inspection, ensure the accuracy of the quantity of received items and strictly follow the "Receiving Operation Manual." These two aspects are the source of discrepancies in warehouse material accounts, cards, and items.**

**5. When shipping, warehouse keepers should check whether documents are accurate and standard. If items are inconsistent with the standard template (required by the manufacturer) issued by the finance department (e.g., code changes, item name updates), they should promptly inform the sales department to verify the correctness of the documents. The document maker must ensure one-to-one correspondence and verification when linking item documents.**

**6. For out-of-stock items, the shipping clerk should register them promptly and report immediately. Make a safety stock plan for the next week.**

**7. All outbound items must have a "Delivery Note."**

**8. When items are in and out, the "Item Control Card" must be filled accurately to ensure the correct balance quantity.**

**9. When items are received, inspected, and put on shelves, the warehouse keeper should verify the item name, code, QR code, specification, model, and quantity, and check if there are any differences from previous items.**

**10. The document maker should check whether all documents are complete, record and verify all documents in a timely manner, and ensure documents are correctly linked. Purchase orders without order numbers cannot be closed, and items without inbound order numbers cannot be closed.**

Accurate accounts, cards, and items are a necessary path for distributors to move toward modern informatization. We encountered a quasi-listed company that, before listing, found a warehouse shortage of over 20 million yuan. Of course, at that time, the company was making money fast and profits were substantial, so the boss didn't pursue it. **But if distributors are not strict with their warehouse management, they will also see mess, dirt, and disorder. The result is that decades of hard work are not as good as managing the warehouse well.**

**Fifth, loose business tracking**
Loose business tracking is almost a heart disease and common problem for all distributors. I believe that **for distributors to transform from extensive management to refined management, they must establish four pillars: first, "process-oriented," second, "standardized," third, "data-driven," and fourth, "informatized."**

**First, all work should follow processes, and processes are horizontal. So, sort out each link according to the process, then control the nodes. This is the key point for distributor business management.**

**Second, we know that without standards, there is no execution, or rather, we don't know how to execute.** The biggest difference between excellent companies 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, always rely on "heroes" to execute creatively, according to the "hero's" standards. Therefore, as soon as the "hero" leaves, the company fails.

**Third, with standards but no data, it's equivalent to no results. All results in a company are spoken by data. Data is the criterion for all standards. Emphasizing data management is the direction of future management.** Finally, in the information age, you must boldly use information tools to work for you. In an era of high labor costs and highly developed information tools, if you haven't fully used information tools, you are a backward distributor who can't keep up with the times and lacks competitiveness.

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

In fact, the problems in distributor management are not limited to these; there are many more, but these are more 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 improve, and what methods or means to use.

Therefore, under the new normal, distributors must keep up with the situation, think more about management, and put more effort into it. They cannot fall in management; only then can they operate smoothly. Otherwise, they will experience "winning in marketing, losing in management." Nowadays, many distributors have more business, larger companies, and more staff, but management remains the same as before, resulting in the consequences like the distributor mentioned earlier. As Kazuo Inamori said: "Small and medium enterprises are like pustules; once they grow, they break." The principle is simple. In the past, we used motorcycles to carry goods; now we use cars. Can you still drive a car the way you drive a motorcycle? In the past, you used your hand to press 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, distributors must learn to grasp both operation and management, and both must be strong!

Twelve years in marketing management, ten years in enterprise consulting management; former Marketing Director of Guangdong Zhongshun Jierou Group, Assistant General Manager of Guangdong Huihailong Group; published over 200 management and marketing articles in various management and marketing magazines and websites; in recent years, focused on research and promotion of "internal management models for quasi-listed companies"; marketing expert, management expert; currently serves as marketing and management consultant for multiple companies.

Contact email: lsw812@163.com
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