---
title: "Eight Misconceptions in the Marketing of Baijiu Trading Companies"
description: "The baijiu industry has entered a deep adjustment period, making survival difficult for many small and medium-sized baijiu trading companies. Based on his practical experience, the author identifies eight common misconceptions in their operations, including excessive credit sales, neglecting promotions during peak seasons, overpricing, and failing to build a reliable sales team."
author: "孙中学"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2016-07-06"
language: "en"
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# Eight Misconceptions in the Marketing of Baijiu Trading Companies

> The baijiu industry has entered a deep adjustment period, making survival difficult for many small and medium-sized baijiu trading companies. Based on his practical experience, the author identifies eight common misconceptions in their operations, including excessive credit sales, neglecting promotions during peak seasons, overpricing, and failing to build a reliable sales team.

The baijiu industry has entered a deep adjustment period, making survival difficult for many small and medium-sized baijiu trading companies. As a grassroots baijiu marketing professional, I would like to discuss some common misconceptions in the operations of many baijiu trading companies (hereinafter referred to as "companies") based on my own practical experience.

**1. Selling on Excessive Credit**
Except for a few well-known brands, it seems that baijiu cannot be sold without credit. Credit sales accompany many companies throughout their operations, leading to a series of problems. It can be said that excessive credit is the root of all evils in the marketing and management of trading companies. Credit sales cause at least four major difficulties for companies.

**1.1 Huge Financial Pressure.** No company has sufficient funds; every payment to the manufacturer is a massive fundraising (or worrying) project, and its difficulty is imaginable. Unless the company closes down one day, the financial pressure will never be relieved.

**1.2 Poor Market Control.** The goods purchased with great effort are sold to channel dealers on credit. Dealers who get goods without paying are unlikely to sell them diligently; they will first sell the goods they paid for to realize cash quickly. If they encounter difficult dealers, even if they sell some, they won't return the payment promptly, as they want to use the company's funds for other business operations. Many companies are led by the nose by such dealers, suffering greatly.

**1.3 Reduced Ability to Manage Employees.** Because of the habit of credit sales, internal employees also engage in personal external sales on credit, and over time, their personal debts increase massively. Once an employee's personal debt becomes large, the company loses effective control over them. It is common for employees with debts to leave without notice, making subsequent debt collection very troublesome.

**1.4 Increasing Bad Debts.** Every trading company has some bad debts or dead accounts, but the more credit sales, the more market defaults and bad debts.

**2. Promotions in Off-Season, Natural Sales in Peak Season**
Due to the obvious seasonality of baijiu consumption, promotions are generally held in the off-season, while in the peak season, companies sleep and let sales happen naturally.

Willem Burgers, in his book "Marketing Details," advocates that **promotions should be even more aggressive during the peak season.** Specifically, when sales are good in the peak season, the main task is to upgrade the marketing level of products, guide and elevate high-end consumer customers. As a result, when the off-season arrives, the high-end consumers cultivated during the peak season can compensate for the revenue decline even with smaller sales volumes. Moreover, promotions in the peak season are more effective and easier.

Unfortunately, few companies in reality follow Burgers' advice. Most struggle with promotions in the off-season, persisting even without results, just to keep employees busy and burn time.

**3. Inflated Price Orientation**
Outsiders think that the profit margins in baijiu are very high. Indeed, it is normal for many baijiu products to be marked up four to five times from factory price to consumer price. Especially when sales volume is small, high profits are needed to support the company's survival.

Now, in the mobile internet era, product transparency has increased. The internet will make the era of exorbitant profits a thing of the past. Therefore, baijiu trading companies **should emancipate their minds and operate the market with more scientific and reasonable prices.** Let consumers enjoy true value for money.

**4. Overemphasis on Channel Dealers, Neglecting Consumers**
Channel dealers and consumers are the two main targets in the baijiu marketing chain. Channel dealers are relatively fixed and easier to work with, while consumers are scattered, requiring long-term guidance and cultivation, with greater manpower and cost investment. Therefore, companies prefer to work with channel dealers, and the rule of "channel is king" further encourages this tendency.

The ultimate goal of liquor marketing is to enter consumers' stomachs, not just to transfer goods to channel dealers' warehouses. **Consumers are the true "king" in the marketing chain.** Cultivating and serving such a "king" naturally requires time and effort. If consumers recognize the product, customers will follow the company, and the entire marketing game will be activated, putting an end to the root of all evils—credit sales. Companies should learn to mobilize consumers to demand products from channel dealers. Rather than being constrained by channel dealers, it is better to focus more on consumer relations.

**5. Failure to Cultivate a Single Product for Breakthrough**
Dacheng Company, as a county-level agent for A-brand liquor for six years, has operated almost all varieties of the brand. The mid-to-high-end varieties have never gained influence. One mid-range variety was carefully operated for four years and just stabilized a group of consumers, but now the manufacturer has replaced it with another variety as the key promotion. Worse, Dacheng's low-end products change every year, and with each change, the manufacturer's sales representative also changes or increases. Over six years, Dacheng has distributed more than 20 varieties of A-brand liquor, but none has achieved notable sales.

Many companies are like Dacheng. Additionally, trading companies share a common trait: they want full price coverage. When they see new products, they love them all and want them all, and manufacturer sales reps, eager for immediate payments, try their best to satisfy them. In the end, the trading company takes on too much and fails to make any single product a key focus. This involves both the company's own misconceptions and the manufacturer's personnel failing to provide firm guidance.

**6. Failure to Build a Reliable Sales Team**
Many trading company owners complain that their salespeople are incompetent and just collect salaries. I believe the main reason is that **low wages lead to low competence.**

On January 5, 1914, Ford Motor Company suddenly set a minimum daily wage of $5 for its workers. What did "$5 a day" mean? It was almost double the average wage of American auto workers at the time and far higher than wages in most other industries. This "$5" immediately attracted the best auto workers in the United States. Ford's problems of high turnover and absenteeism were solved. Those who already had a Ford job wanted to keep it, and many more wanted to get in. Within days of the announcement, tens of thousands of people braved the cold to apply. This wage increase was later called the most amazing "masterstroke" in business history.

Companies only demand execution from employees, rarely discussing compensation; they only demand work, rarely mentioning income. If that could motivate employees, it would only work for cults. After Ford's "$5 a day," a Hungarian worker quickly doubled his personal output. When his supervisor asked how he achieved such progress, he replied: "Mr. Ford gave me $2.50, and he got 250 parts. Now he gives me $5, and he gets 500 parts. I repay him." Even while answering, his eyes never left his work—he kept producing parts.

So "low-wage" treatment only cultivates mediocrity, laziness, and arrogance. If management is loose, employees won't work; if strict, they resist; if stricter, they quit. Shi Yuzhu once said that companies with low wages have the highest management costs. Some say money is the smartest thing in the world, so "$5 a day" screened out the best and most hardworking workers for Ford.

**7. Failure to Establish a Correct View of Profit**
Baijiu manufacturers usually reserve promotional expenses in advance. Then they allocate these expenses to companies under the guise of market investment. However, many companies are reluctant to fully invest these funds into the market, or even directly sell the tasting products. Trading companies easily gain short-term benefits, making them even less willing to work on the market, instead focusing on bargaining with manufacturers.

**When expenses come, they are reluctant to invest—insufficient investment leads to poor market performance—no sales, poor company performance, poor employee income—employees without income are even less willing to work...** Thus, the company falls into a vicious cycle, eventually only complaining about fate, never looking at their own problems.

**8. Arbitrary Marketing Operations**
Many small and medium-sized trading companies are run by the boss personally, following intuition, so **subjective factors are inevitably prominent** in marketing operations. Many specific marketing practices lack a global view and long-term decision-making. Specific manifestations include chaotic pricing, no market area division, no channel division, and unclear job responsibilities. While this approach is flexible and has some short-term effects, it brings great hidden dangers and harms to the company's long-term development.

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