Click for details In the blink of an eye, it's already the end of 2018. Looking back on the past year as it draws to a close, many distributors are sighing with emotion. After taking stock of their busy year's harvest, many distributors are deeply disappointed. After deducting personnel costs, rent, vehicle expenses, and other expenditures, not to mention meager profits, those who didn't lose money are already doing well. As they cross into the new year, distributors may all ponder one question: facing the upcoming 2019, how should they make money? Distributors are a crucial link in the sales channel chain where enterprise products meet end consumers directly, and their role in the market is enormous. However, with the slowdown of economic growth, changes in supply-demand relationships, and intensified competition in the food industry, the overall market environment, consumer demand, circulation, and terminal formats have all changed, further intensifying the differentiation among distributors. The "Matthew Effect" is more evident at the distributor level, making survival of the fittest inevitable. Distributors with good products and good services, operating as companies, will become the main players in regional markets and rise rapidly. Those who lower distribution focus, refine operations, and have service awareness and capability to consolidate terminal networks will be more advantageous, because in an era of meager profits, the efficient will have more opportunities. Those who simply focus on selling for the sake of selling, making product sales their only goal, forgetting market development, maintenance, system and network building, and forgetting to help customers grow stronger and develop together, will not survive. How do distributors make profits? Distributors make profits by relying on good products and good services they represent! A distributor is defined as someone who takes money to purchase goods from enterprises, not for their own use but to resell them. They merely handle the goods and resell them. Therefore, distributors make profits by representing tangible products from enterprises plus intangible services provided by enterprises, and then providing tangible products and intangible services to terminal customers and consumers when reselling. If a distributor does not make a profit during operations, then it must be that one or more of the four items—tangible products provided by the enterprise, intangible services provided by the enterprise, tangible products provided by the distributor downstream, or intangible services provided downstream—have problems. Good products plus good services are the distributor's money-making secret. For enterprises, marketing refers to discovering or mining consumer needs, seizing market demand desires, and promoting and selling products through overall atmosphere creation and product form development. It mainly involves digging deep into product connotations and aligning with consumer needs to make consumers deeply understand the product and then purchase it. The essence of marketing is: Seize customer needs and quickly commoditize those needs. All commodities consist of tangible products and intangible services. For distributors, to do marketing well, they must distribute good products that meet the needs of consumers in their market and sell their company's good products plus good services. If their company can sell more products than other companies through good services, then their company will be more profitable than others. Therefore, to make money, distributors must highly enrich the "value" that consumers in their market demand. The best way is to organically combine tangible products with intangible services. Achieving this is the most powerful marketing and the distributor's money-making secret, ensuring they remain invincible in the future. What is a good product? In the 4P theory of marketing, product is placed first; price, place, and promotion all occur based on the product. Therefore, product is the foundation, the key, and the first priority. In today's food industry, "product surplus does not equal quality surplus," so if a distributor doesn't have good products, everything else is zero. A good product must have the following characteristics:

  1. Product positioning resonates with consumers: That is, make a proposal to consumers, stating the clear benefit they will get from purchasing this product; this proposal must be unique to the brand, something competitors cannot or have not proposed; it must be attractive enough to move consumers and attract them to buy. Resonance can be formed in two ways: product benefit + support point; product feature + benefit point.
  2. Product presentation has sufficient appeal and impact: That is, the product's name, concept, packaging design, and the copy, symbols, images, colors on the packaging can attract consumer attention and interest (self-traffic), and stimulate impulse purchases. Simply put, consumers like it at first sight and want to buy it.
  3. Brand endorsement has sufficient trustworthiness: Brand endorsement is a trust certificate that guarantees brand reputation, evidence proving brand credibility, a trust proof issued for the brand, and a trust seal stamped on the brand... It includes the brand's origin, the company's position in the industry, certifications from authoritative institutions, etc. In short, all information combinations that build trust for the brand are brand endorsements.
  4. Word-of-mouth marketing has sufficient driving power: That is, after trial purchase, consumers will repurchase, and not only buy themselves but also mobilize friends and relatives to buy, forming good word-of-mouth communication. A good product first lies in "trial purchase," and second in "repeat purchase." If there is no trial purchase, it must be a problem with product positioning or presentation; if there is no "repeat purchase," it must be a problem with product quality or service quality. What is good service? It is when the customer's "post-evaluation" after cooperation is higher than their "pre-expectation." If the customer's actual evaluation after cooperation is higher than their pre-expectation, it means the product and service are recognized, and they feel it's worth more than they paid, so they will naturally cooperate again and become repeat customers. If the customer's actual evaluation after cooperation is lower than their pre-expectation, it means the product and service are insufficient, and it becomes a "one-off deal." If the customer's actual evaluation after cooperation is equal to their pre-expectation, they may continue cooperating when there is no competitor, but once a competitor enters and offers better service, they may switch. To make it easier to understand, let's illustrate the relationship between "pre-expectation" and "post-evaluation" with several cases. [Case] A distributor represented a beverage. In the initial stage of market distribution, they first had their sales staff do promotional warm-up and free consumer tasting. Then they selectively distributed the product. Terminal owner A in the regional market heard the introduction from salesperson Xiao Li and ordered 10 cases. Salesperson Xiao Li not only did counter displays, freezer displays, but also cut-case displays and promotional material placement. He also conducted in-store free tasting, and as a result, the 10 cases at Terminal A sold out in less than a week. Terminal owner A then had a high evaluation of the distributor's product and salesperson Xiao Li, and began to reorder continuously. This is because Terminal owner A developed a "pre-expectation" of the product through the distributor's initial promotional warm-up and free tasting. After entering the store, salesperson Xiao Li also conducted free tasting, which made the product sell out quickly. Thus, the store owner's "post-evaluation" was higher than the "pre-expectation," leading to sustained cooperation. In contrast, Terminal owner B in the same market also developed a "pre-expectation" of the product through the distributor's initial promotional warm-up and free tasting. Then, after the introduction by salesperson Xiao Wang responsible for the area, they also ordered 10 cases. However, salesperson Xiao Wang unloaded the 10 cases directly into the store's product storage area, collected the money, and left, without doing any terminal visualization work. Subsequently, every time the salesperson visited the terminal, they would just ask the owner if they had any stock. The owner always said the previous order hadn't sold yet and they'd reorder after selling. Over a month passed, and the goods at Terminal B remained in a forgotten corner, barely sold, and Xiao Wang didn't care. As a result, the store owner's "post-evaluation" was lower than the "pre-expectation," leading them to believe the company's products were hard to sell, making the cooperation a "one-off deal." [Case] A regional distributor represented a fruit juice beverage. The product was excellent, and channel profits were considerable. In the initial distribution stage, the distributor screened channel members and selectively distributed. After distribution, they helped terminal stores strengthen visualization, customer relations, and consumer promotions. This made initial stocking terminal owners very satisfied with the product quality and service of the company. However, in later market operations, due to poor price control, some terminal owners sold at low prices, causing chaos in regional market retail prices. This affected many terminals' profits and also caused these terminal owners to offend many regular customers due to price confusion. Therefore, these store owners felt the company's service was poor. Because the early customers' "post-evaluation" was higher than their "pre-expectation," but later customers' "post-evaluation" was lower than their "pre-expectation." Similarly, distributors judge the quality of services provided by enterprises in the same way. [Case] A strong regional brand, for sustainable development, spent heavily to hire a well-known domestic design company to design product packaging, and invited multiple domestic technical experts to repeatedly taste and evaluate the product's flavor. After more than half a year of effort, they developed several products. During the recruitment stage, many distributors were optimistic about these products, so recruitment went smoothly. After a year of operation, some regional markets performed very well, while in others, distributors collectively gave up their distribution rights. Market visits revealed that in well-performing markets, regional managers personally went to the front line, strictly implemented the company's promotion strategies, and helped distributors and their employees grow. In poorly performing markets, regional managers only appeared when it was time to collect payments and ship goods, then disappeared. This allowed low-priced cross-region dumping from neighboring markets to destroy the markets carefully built by diligent distributors, leading them to believe the company's service was poor and give up distribution rights. Those distributors who didn't build the market had little sales volume and couldn't make money after a year, so they started looking for other products. During periods of rapid economic growth, due to supply-demand relationships, many brands had an advantage in sales, so service quality did not affect company performance. However, today's supply-demand relationships have changed. Good service plays a pivotal role in today's marketing. Good service is a competitive advantage in marketing. For both enterprises and distributors, only good products plus good services are the secret to making money. What are the main factors affecting customers' "pre-expectation"? 1. Advertising and publicity For example, seeing the company's product and service introductions in newspapers, magazines, television, outdoor advertising, new media, etc., customers will understand that this company can provide such products and services! Therefore, a customer's "pre-expectation" of a company is largely influenced by the company's advertising and publicity. The essence of publicity is to make customers believe in the company, not to blindly exaggerate and shout to attract customers. All publicity activities should revolve around the company's actual strengths, and efforts should be made to make publicity just right, achieving the purpose of promoting oneself and attracting customers while leaving some room for later work, so customers genuinely feel that cooperating with you is worth more than they pay. If the actual product quality and service level do not meet expectations, customers' expectations will instantly vanish, followed by distrust of the company. Worst of all, these customers will spread their experiences, causing negative public opinion. For a company that needs to establish a good reputation among customers, such public opinion is like a bombshell. Therefore, excessive publicity may have a counterproductive effect, putting enormous pressure on the company and leading to distorted development. 2. Sales personnel's selling Customers will form a rough impression of the company based on the salesperson's actions, thus forming a "pre-expectation" of the company's products and services. Services are mostly provided by people, which gives companies complex problems. Both providers and receivers of services are specific individuals. Improving service quality is a process of improving the comprehensive quality of service providers. When considering and analyzing how to improve service quality, from top managers to every ordinary employee, everyone should improve their own comprehensive quality. To remain invincible in fierce market competition, the company must first deeply understand what customers want, i.e., their "pre-expectation." After clearly understanding these needs, the company should formulate specific service standards and norms, compile them into employee handbooks, have every employee learn them, strive to improve each employee's professional skills, and gradually establish a "customer-centric" concept in practice. 3. Word-of-mouth from existing customers Existing customers' evaluations of the company will have a profound impact on other customers. Because "advertising" and "selling" are done by internal personnel, insiders naturally won't speak ill of their own company. Customers accept this information with skepticism. In such cases, external evaluations play an important role, especially for customers who are hesitant. Good word-of-mouth is often more persuasive than company publicity and salespeople's explanations. [Case] A company hired a large number of salespeople to strengthen its sales department, but in overall performance evaluation, it found that three people had particularly high customer churn rates. Later, during business analysis, management discovered that the reason for their poor performance was that they always exaggerated the company's service scope without limits. They had a common trait: no matter what customers said or requested, they would promise without thinking. This working style initially won them more customers and performance than other businesses in the first half year. But after half a year, as more customers realized that the company's services couldn't meet the standards promised by the salespeople, the three people's performance began to decline sharply. Eventually, they became the worst performers in the company. Moreover, the customers lost from them brought enormous negative public opinion pressure, causing a trust crisis for the company. 4. Personal experience This is also the most influential factor in forming "pre-expectation": the customer's own past experiences. [Case] Last time I visited a company's base market for observation. When communicating with the company's salesperson on site, they spoke eloquently, clearly, and richly, seeming to know everything about market development and maintenance, terminal control, brand promotion, and even supermarket, specialty store, and hotel operations. I almost doubted they were a salesperson rather than a sales expert. That salesperson was really impressive. We talked for over an hour, during which they almost exclusively taught me methods and strategies for terminal store operations to make money. I had a very good impression of them. They were neatly dressed, spoke sensibly, had clear logic, and a humble attitude. I almost didn't want to speak but just listen. Honestly, they weren't selling me a product; they were creating value for me. Dealing with such knowledgeable salespeople, it's hard not to make money! In short, judging a company's product and service quality is simple: if the product and service quality are excellent, they will naturally be accepted by customers; if the service is poor, even with more publicity, they will be eliminated by fierce market competition. This is the law of the market economy. How can distributors choose enterprises that can provide them with good products and good services? Food distributors all know well that "best-selling products don't make money, money-making products don't sell well, and products that both sell well and make money are rare." Therefore, when selecting products, distributors should consider their market environment and consumption habits, and combine the concepts of good products and good services to conduct a "six-look" evaluation of potential partner companies: First, look at the company's brand power: Without brand power to support R&D and innovation capabilities, new products will find it hard to break into the market. Second, look at the company's hard and soft strengths: This includes the company's long-term planning ideas and strategies, marketing management level, personnel quality compared to competitors' salespeople, product knowledge and confidence, industry and competitor analysis capabilities, regional market operation ideas and strategies (methods and approaches for distribution rate, methods and approaches for sell-through rate, management of cross-region dumping and price chaos), and complete promotional and sales material follow-up. Third, look at market space: New products need living space, i.e., how large the consumer market is and which demographics they occupy. Market timing and capacity start from the market, specifically grasping the direction of new product selection. Correct direction is the first and key step to ensuring new product success. Fourth, look at consumption timing: New products need to guide consumption; if timing is immature, it's easy to fall into a passive situation of investing without returns. New product selection must have a grasp of trends and market sensitivity, always paying attention to social trends, era trends, and market development, seizing market opportunities, and choosing products that meet market needs and future trends. Fifth, look at leading brands: If major brands are creating momentum and SMEs are following suit, it will form a collective force. Sixth, look at the company's base market: The base market is the company's fulcrum (support for material supplies in other markets; oxygen supply for strong spiritual motivation); the base market is the company's talent pool (training ground; marketing training academy; talent export base); the base market is the company's experimental field (practice ground for new methods and explorations; birthplace of successful operating models); the base market is a banner (fundamental to solving the company's survival and establishing its industry status). It should be noted here that distributors must understand the difference between a base market and a model market. A model market is created by the company for distributors to see, aimed at fooling distributors during recruitment (many model markets are sales bought by the company at a loss; after real cooperation, the company won't invest in your market like that). A base market is created by the company for itself; by building the base market, they train a team and refine a model, and this model is designed to ensure that distributors following it can make money. Then, through this team and model, they help distributors make money. Therefore, when selecting products, distributors must personally visit markets where the company has been operating for a while to investigate and verify authenticity, avoiding being deceived. 2018 is about to fly by; now, you must prepare for the new year; there may be dangers; but you must be brave; overcome obstacles; overcome difficulties; wade through hardships; move forward courageously; maintain cooperation; climb to new heights; enjoy success! Finally, I wish all new and old distributor friends a prosperous 2019 with booming business and abundant wealth! Click here to register in one click