-01- During the epidemic, what 'kills' distributors is this Terminal sales are slow, inventory is heavily backlogged. Is 2020 difficult for distributors? The peak season is coming, but distributors lack funds to place orders. Is it difficult for manufacturers? Currently, fund shortage has surpassed slow sales and high inventory to become the most severe problem facing distributors. During the epidemic, although sales are blocked, distributors' cash expenditures have not stopped. Personnel wages, housing costs, warehouse rental, vehicle fuel, and epidemic prevention materials are all continuously consuming distributors' cash flow. Entering March, beer, beverages, snacks, dairy and other categories enter the pre-peak stocking phase. But how can cash-strapped distributors scrape together hundreds of thousands of yuan for orders? Facing increasing pressure from manufacturers, distributors know the moment of life and death has arrived. Whoever has cash on hand and can gather funds in the short term will survive in the market after the epidemic when consumption recovers, and will become this year's winner. Because the epidemic has impacted the FMCG market, it also brings new opportunities. Community group buying, home delivery services, BC integration, and social e-commerce are all new opportunities for distributors, but the prerequisite for seizing opportunities must be sufficient cash flow. Lack of money is the true portrayal of distributors at present, and cash flow shortage is the killer of distributors. -02- Who will guard the capital moat of distributors Cash flow is the lifeblood of distributors; a break in capital flow means distributors will lose their ability to generate blood. But facing the pressure of ordering and paying from upstream manufacturers, and the current situation of long account periods and difficult collection from downstream terminals, what should distributors do? Who will guard the capital moat of distributors? Self-rescue? Recovering accounts, selling properties and vehicles, even layoffs and salary cuts—every step is difficult. This kind of self-rescue by cutting off one's arm can only be called scraping money together, not financing. The PMI index plummeted, small and medium-sized enterprises are suffering. Many employees voluntarily take half salary, Ctrip executives take zero salary, and so on. Their common point is survival by cutting off the arm. This will inevitably make distributors pay higher costs and prices, even falling into a vicious cycle. Find manufacturers? But manufacturers are also struggling. They have to help distributors solve inventory and ensure production. Facing hundreds or thousands of distributors, manufacturers are helpless, and may even be dragged down by distributors. Find banks? Procedures are complex, disbursement is slow, and it is highly localized. Small distributors have low loan quotas, unable to solve cash pressure. Large distributors have high quotas, but slow disbursement can delay matters. Private lending? Although disbursement is fast and procedures are simple, interest rates are high, risks are high, and it is easy to fall into predatory loans, ultimately bringing greater danger to distributors. Distributors need safe, convenient, fast, and low-cost financing methods. Obviously, neither manufacturers nor distributors themselves, nor even banks, can simultaneously meet these conditions. Distributor financing is to create profits and help manufacturers revitalize channels. There are many financial institutions providing financing for enterprises, but few institutions provide professional financing for distributors. Why? Because enterprises have fixed assets and supply chains, and their accounts payable risk is small. But distributors are different; their businesses vary in size and performance. Especially during the epidemic, despite strong loan demand, there is still significant risk for financial institutions. Is it really difficult for distributors, who play an important role between enterprises and terminals, to obtain financing? -03- Do safe, convenient, and low-cost financing tools really exist? Actually, distributors need not worry too much, because a financial product specifically designed to solve distributor financing services has already appeared—it is Cainiao Cloud Loan. Developed jointly with China Construction Bank, using Cainiao Supply Chain Finance as the cooperation platform to provide supply chain data information as the basis, in scenarios agreed upon by both parties, it is a financial platform that provides internet-based, fully online big data credit loan business for domestic small and micro commercial enterprises. At the same time, Cainiao Cloud Loan has three major advantages: wide coverage, fast credit approval, and low financing costs. Moreover, Cainiao Cloud Loan can help national distributors of enterprises apply for loans simultaneously, solving the problem of enterprises' annual sales progress being affected by distributors' financing difficulties. In conventional financial institutions, distributors in different regions can only apply for loans at financial institutions within their respective regions. Due to different policies and services of local financial institutions, the impact on distributors varies. For example, place A has slow disbursement, place B has high interest rates, and place C has complex procedures. For instance, a beverage manufacturer wants to launch new products in places A, B, and C simultaneously. But distributor A calls to say, "Sorry, my loan hasn't come through yet, so I won't order for now." Distributor B calls to say, "Sorry, the interest rate is too high. You need to increase my rebate and support, otherwise I won't do it." Distributor C also calls to say, "My procedures are too complex, it will take a while." You see, because of the small matter of loans, the manufacturer's annual plan may be disrupted. So how does Cainiao Cloud Loan solve this? First, it is online operation, no offline procedures needed. This immediately solves the territorial problem. In addition, with the foundation of the internet platform, credit approval becomes more convenient and faster, allowing same-day application and same-day credit approval, with borrow and repay at any time, improving loan efficiency for distributors. Moreover, during the epidemic, Cainiao Cloud Loan has further reduced loan interest rates, with borrow and repay at any time, and a 1-year term with interest paid first and principal at maturity. Through the lowest cost to alleviate the greatest funding needs. Finally, platform security. As a financial platform in the supply chain sector of the Alibaba ecosystem, the core positioning of Cainiao Supply Chain Finance is to use supply chain data and capabilities to assist financial institutions, enabling them to better serve small and medium-sized enterprises. From a professional financial risk perspective, the combination of logistics supply chain data and business flow data is a very good low-risk model. Moreover, through Cainiao's logistics supply chain capabilities and digital capabilities, it can feed back and accelerate the digitalization process of the entire logistics supply chain, helping manufacturers improve and optimize their supply chain capabilities, empowering both manufacturers and distributors. The epidemic has exposed the most fragile part of distributors—their control over cash flow. The strength of a distributor is not reflected in how much goods they sell in a year, nor how many brands they represent, but in having a safe and convenient financing tool in the face of risk. So what are the criteria for judging whether a financial tool is reliable?
1. Whether it has the endorsement of a large financial institution;
2. Whether it has a financial model that resists risks;
3. Whether the platform itself has brand recognition. As long as these three criteria are met, it is a reliable financial tool. Having discussed so much, let's look at the market service situation of Cainiao Cloud Loan. Although it has only been launched for one year, many distributors have already benefited. Currently, in the FMCG industry, the main brands with cooperative lending include Mengniu, Budweiser, Shuanghui, Jinmailang, Wanglaoji, Jiusan Grain and Oil, and their distributors. There are also some brands in communication for cooperation. It is expected that in 2020, cooperative brands will cover mainstream FMCG brands in the market. In just one year since the new product launch, it has served more than 2,000 distributors, with loan disbursement of nearly 2 billion yuan. The product and business processes are relatively mature. We also hope to serve more distributors as soon as possible, especially during the epidemic, so that more distributors do not suffer from cash flow issues. The epidemic will eventually pass, and the market will eventually recover. In 2020, distributors must not only survive but also live better. To learn more about Cainiao Cloud Loan, **Brand owners for cooperation, please add the following WeChat Distributors for cooperation, please add customer service WeChat **When adding, please note (Cainiao Cloud Loan) If your tip is adopted, you will be paid 400-2000 yuan