---
title: "Don't Be Fooled! 7 Things Distributors Must Never Say When Negotiating with Manufacturers"
description: "This article warns distributors against saying seven specific phrases during negotiations with manufacturers, as they can undermine their position. It advises focusing on concrete solutions, demonstrating capability, and building trust to achieve successful long-term partnerships."
author: "New Distribution"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2014-06-20"
language: "en"
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# Don't Be Fooled! 7 Things Distributors Must Never Say When Negotiating with Manufacturers

> This article warns distributors against saying seven specific phrases during negotiations with manufacturers, as they can undermine their position. It advises focusing on concrete solutions, demonstrating capability, and building trust to achieve successful long-term partnerships.

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1. "My market is too special compared to others; it's very difficult to operate."
Such a vague description is nothing more than trying to give the manufacturer a preconceived impression at the start of negotiations—that it is indeed special, difficult, and requires significant investment. But the key question is: how "special" is it, and where exactly is the "difficulty"? Because when you claim something is "special" or "difficult" that is also common in other markets, your ulterior motives are exposed, which is detrimental to your subsequent negotiation terms.
Many liquor distributors, upon meeting manufacturer representatives, first talk about how local restaurant channels are "bought out" or "exclusively contracted," how supermarket terminal costs remain high, and then how competition is fierce and promotional tactics are easily replicated. In fact, these are issues that need to be solved jointly with the manufacturer, requiring specific methods, not just problems.

2. "If I do it, I want exclusive general distribution for the full product line across all channels."
It's understandable for distributors to make such requests; after all, having exclusive distribution for a product line in the local market reduces risk and gives them more leverage in ongoing cooperation. But one point: why do manufacturer salespeople pay attention to you? As a manufacturer salesperson, thorough research is necessary before developing a potential market, and then formulating a general operational approach is essential. At this point, distributors should not rush to disrupt the manufacturer's plan. During discussions, leverage your channel and terminal advantages to reasonably secure the share you want. Whether you want all channels or the full product line, there are conditions behind it. Remember, when a manufacturer develops a potential market, they also prepare multiple options for distributor selection.
In the early stages of launching a new product in a market, manufacturers do not want two or more distributors operating it, as it can lead to market chaos, price system collapse, and overly transparent profit margins for distributors—these are the manufacturer's "Achilles' heels." The reason they limit your product and region is fundamentally due to concerns about your overall strength. Therefore, distributors must go all out and do their part. The manufacturer will then reciprocate, as is their common practice.

3. "I'll just prepare the funds; you manufacturers handle everything else."
This may sound impressive, but manufacturer salespeople are indifferent to it. If that were the case, what would be the point of having a distributor? If the manufacturer does everything, they might as well operate directly in the local market. Moreover, manufacturer salespeople cannot immediately become familiar with the local market. Sometimes, at the start of cooperation, money cannot solve all problems. The manufacturer's unspoken message is: there are plenty of people richer than you; why should we cooperate with you?
When a manufacturer launches a target market, their greatest hope is to find a suitable partner with complementary strengths. What are the criteria for suitability? Mature network channels, solid operational management systems (especially sales teams), quality connections, a trustworthy reputation, and financial strength. Money is sometimes not the sole criterion for evaluating a distributor. Overall quality has become an unwritten rule in selecting cooperative agents. A distributor with only funds is essentially gambling when operating a product—the manufacturer gambles on the market, and the distributor might gamble on the manufacturer, leading to low success rates.

4. "I don't want any of your market investment; just give me the bottom-line price, and I'll handle it myself."
Distributors who say this fall into two categories: first, those who are genuinely strong, with mature operational experience and models, and can say this based on their strength; second, those who are skeptical of manufacturer policies and feel there might be room to "squeeze more toothpaste."
Manufacturers' product pricing systems are very rigorous. If distributors have doubts, they should clarify under what conditions they can get the first-tier (factory) or second-tier price, rather than arbitrarily demanding bottom-line pricing—unless the manufacturer has such a policy. Manufacturers are well aware that bottom-line pricing essentially means letting distributors fend for themselves.
Generally, manufacturers do not vary their pricing system from person to person; it's a basic principle. Otherwise, the unified national price would be undermined, and the potential losses would be unimaginable. Manufacturers won't make such a foolish mistake. Therefore, during negotiations, distributors should not make excessive demands on pricing. Of course, getting the first-tier or second-tier price requires courage, strategy, and justification; otherwise, you'll be heading in the wrong direction.

5. "At product launch, we should do TV, bus, billboard, newspaper advertorials—everything."
Manufacturer salespeople detest this statement for several reasons: first, it shows the distributor's superficiality and lack of understanding of basic product operation rules; second, it indicates the manufacturer hasn't yet earned the distributor's trust. This is essentially a coercive tactic to extract resources.
Market investment follows a pattern. The product introduction, growth, and volume phases are different, and so are the market expenses. For example, during the introduction phase, the focus is on extensive distribution, entry and display in key channels and terminals, and promotional follow-up. At this stage, the primary goal is terminal coverage, so expenses are allocated to personnel salaries, terminal entry, product display, and promotional costs at key terminals. If you also consider launching in second- and third-tier markets simultaneously, newspaper and TV advertising can be considered. Thus, expense investment becomes more targeted.

6. "The salesperson you assigned to my market is very incompetent (or very competent)."
Perhaps the distributor is reporting the actual situation to the manufacturer's superiors, but instead of verbal complaints, it's better to produce more results and use actual data to prove your point.
Manufacturers find remote management of salespeople challenging and often helpless. The common approach is to base management on local distributors, including attendance and daily reports, which gives distributors leverage to "intimidate" local manufacturer salespeople, leading to occasional false reporting of market expenses. Manufacturers are aware of this but turn a blind eye because the distributor's performance is still acceptable.
Of course, it's important to truthfully report a salesperson's performance in the local market. But the "report" should be timed and placed appropriately; otherwise, it can backfire. Nowadays, a common saying among mid-level and above manufacturer leaders is: salespeople who are scolded most harshly by distributors should be promoted, while those praised daily by distributors will eventually be dismissed. This subtle paradox in employment is worth pondering for distributors.

7. "Our contract must be signed for three or five years at a time, or I won't sign."
This may seem like high expectations for the manufacturer and a desire for long-term cooperation, but it actually reflects a subtle fear of being "abandoned" in the future. Lack of confidence and unintentional weakness are detrimental to future cooperation.
Standard contracts between reputable manufacturers and distributors are typically signed annually, with some including trial periods of three to six months. Don't easily change these established rules because the procedures are cumbersome, and while it's not a core issue, it can attract too much high-level involvement, increasing pressure. Manufacturer salespeople generally prefer to avoid this. The key to contract performance is the process and results; if you meet the manufacturer's targets on time, your interests are protected. Even if you don't meet the targets, the manufacturer may consider replacing you but won't dare to do so unless absolutely necessary, because the cost of developing a new distributor is six times that of maintaining an existing one—a basic fact known to almost everyone in the industry. As long as you perform reasonably well, you can rest easy.
Therefore, distributors need not "bargain" over the contract duration. It's better to focus on how to expand the local market quickly and steadily.
In manufacturer-distributor cooperation, the eternal theme is integrity. If this theme is violated, the substantive meaning of cooperation will be greatly diminished. Sometimes, cooperation fails or hits a snag due to a few dishonest words. The above summary may be one-sided, but since these phrases are "unpleasant" and "inappropriate," it's best not to say them. As the saying goes, seek common ground while reserving differences; focus on the mainstream and the main issue to ultimately achieve a win-win outcome.

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