From Mondelēz and Mars Distributor to Category Distributor: How Did He Achieve Annual Sales of 50 Million in a County-Level Market?

Distributors often say business is tough, citing high manufacturer targets, severe e-commerce impact, and demanding stores. Yet, a small group of distributors thrive, unaffected by these pressures, with sales and profits rising steadily. Recently, I met Wang Lei, general manager of Linquan Zhicheng Trading, a snack food distributor in a county market. He entered the FMCG trade by chance in 2009, starting with no experience or resources. Through gradual exploration, he became the largest snack food distributor in his local county market, with annual sales of nearly 50 million yuan and direct distribution to over 2,000 retail points. Over 10 years in distribution, he leveraged brand growth dividends and his own exploration and transformation, adjusting his business structure to grow steadily. Here's how he did it, hoping his experience can inspire distributors struggling in their businesses.

-01- After Surviving the Survival Line, Specialization Beats Diversification Wang Lei's distribution business began with selling Wrigley's gum. At that time, Doublemint and Extra were bestsellers, but prices were chaotic. Several previous distributors had tried but quit quickly due to lack of profit. "The fearless are ignorant," as they say. Unaware of the industry's pitfalls, Wang Lei took on the local Wrigley's distribution, paying an initial 50,000 yuan for goods. After a month, he realized that following the manufacturer's suggested prices often made his products more expensive than those of parallel importers and secondary wholesalers. Already in the game, Wang Lei had no choice but to push forward. As a local distributor, he analyzed the strengths and weaknesses of both sides. "Their visit cycle was once every 7 days; since I was closer, I could visit every 3 days. In terms of price, I matched their prices and won by leveraging the gap in visit frequency." This way, wholesalers found they couldn't sell their goods, sales dwindled, and eventually they stopped coming. Through this strategy, Wang Lei won back the market within a few months. From then on, his Wrigley's business grew nearly 30% annually. With stable clients, Wang Lei gradually added staff, vehicles, and warehouse space, and expanded to distribute first-tier brands like Pepsi, Lay's, Uni-President, Master Kong, Oishi, Tsingtao Beer, and Red Star Erguotou. Some partnerships ended due to disagreements. Wang Lei recalls that around 2017, as he distributed more brands, manufacturers' fees and task pressures increased. He calculated and found the root of the problem: First, from a profitability standpoint, beverages accounted for 50%-60% of capital but contributed only 30% of profits—a severe imbalance in input-output. This didn't even include employee effort, as beverage brands required extensive in-store execution, consuming over half of sales reps' time. Second, compared to snacks, snacks required little effort for sales growth and maintenance. Monthly targets were met easily, with 20%-30% growth, high gross margins, and good turnover. After this analysis, at the end of 2017, Wang Lei decided to cut beverages, beer, and other categories that consumed energy and capital, focusing solely on snacks. This not only concentrated personnel, capital, and resources but also significantly improved profitability. At that time, Zhicheng Trading was a single-category distributor for well-known snack brands like Mondelēz, Mars Wrigley, Oishi, Lay's, and Perfetti Van Melle.

-02- From Multi-Brand to Snack Category Distributor: A 25% Selection Rate After cutting beverages, which contributed half of sales, Zhicheng Trading sought new profit growth points. Wang Lei told me, "If we continued to take on well-known first-tier snack brands, first, it wasn't easy to get them; the market already had mature distributors. Second, even if we got good brands, the investment in manpower, materials, and money would be significant." Given this, they considered expanding "external procurement" brands—products with lower brand recognition sourced from large wholesale markets in Hefei or Zhengzhou. This approach required relatively lower investment, offered more choices, wasn't constrained by manufacturers, and allowed them to select high-margin, high-turnover items. It also motivated employees. Once the direction was set, the next step was product selection. Snack foods are a broad category with numerous products; choosing quality items is a major challenge. Wang Lei said, "Since we weren't sure which products would sell, we used the simplest method: let the market decide." He divided snacks into subcategories like biscuits, pastries, candies, chocolates, and nuts, then purchased in bulk by category. For example, for candies, he bought 200-300 SKUs from wholesale markets and distributed them to stores for batch testing. After 2-3 months, based on sales reps' feedback and turnover data, they identified which products moved. From 2017 to 2019, adding one category at a time, Zhicheng Trading screened 700-800 SKUs from 3,000, a 25% selection rate. Wang Lei explained, "Often, products we thought were high-end just didn't sell due to regional differences, local consumption habits, and purchasing power. So we bought the entire category at once and let the market respond, rather than relying on subjective judgment." Through external procurement and brand distribution, Zhicheng Trading now has 1,500 SKUs. With the backend sorted, the frontend faced a challenge: how to efficiently distribute over a thousand items. When a sales rep enters a store, what should they push? If all products have targets, it's like having no targets.

-03- Focus on Key Stores, Get More Products In, and Motivate Both Sales Reps and Stores First, for sales reps, Wang Lei divided assessments into two types: First, for mainly distributed brands like Wrigley, Oishi, and Perfetti Van Melle, manufacturers set clear targets. Wang Lei broke these down to each rep, with corresponding assessment pay and a 120% cap to ensure steady completion. Second, for external self-operated products, with a basic standard of 1,500 yuan, divided into 5 snack categories at 300 yuan each. When a category reaches 100%, the rep earns that 300 yuan. There's no cap for external products; more work means more pay. While assessments motivated reps to recommend more products, store owners often had their own preferences, and reps couldn't push everything due to time constraints. Therefore, in addition to rep incentives, Wang Lei implemented store incentives. He divided stores into two types: general customers, who mainly bought first-tier bestsellers from Zhicheng Trading (only 10-20 items), and VIP customers, who also bought external products. For general customers, the goal was to increase SKU count—a product expansion phase. For example, if a customer already had 40 first-tier items, adding 60 more to reach 100 SKUs earned a 200 yuan monthly reward; 150 SKUs earned 300 yuan, etc. This encouraged stores to replace other snack products with Zhicheng's items, maximizing SKU presence. For VIP customers, the goal was to maintain SKU stability and prevent price undercutting by competitors. When a customer is loyal and sells 10,000 yuan monthly, competitors may still try to steal them. Setting rebates like 2% for 10,000 yuan, 3% for 20,000 yuan, etc., prevents store owners from switching due to a slightly lower price on one item. They won't defect for a 0.5 yuan difference. Wang Lei told New Distribution that external self-operated products have maintained double-digit growth for two consecutive years, with growth exceeding 100%, accounting for 30% of sales but about 50% of gross profit. Next, Zhicheng Trading aims to further optimize product mix, identify top sellers based on sales data, and promote them heavily, with other products as supplements. Wang Lei believes there's still great potential in focusing on the snack category.

-04- Summary The above is the journey of Zhicheng Trading from a multi-brand, cross-category distributor to a single-category snack distributor. Although sales fluctuated initially, both gross and net profits grew rapidly. Earlier, New Distribution predicted that in a regional market, mainstream distributor forms would fall into three types: First, brand distributors, who deeply cooperate with an upstream brand, with that brand accounting for over 50% of business, acting as the brand's local service provider, directly serving terminals, leveraging local low-cost advantages to help launch new products and sell goods. This type is common in beverages, milk, and alcohol. Second, category distributors, who focus on a specific category for deep operation, becoming the local supplier for that category, such as snacks, condiments, or daily chemicals. Third, channel distributors, who provide one-stop supply around retail or restaurant outlets. Zhicheng Trading is a typical benchmark among category distributors in snacks. By focusing on the category, setting up multi-dimensional incentive assessments, getting more snack products into stores, seizing snack shelves, and squeezing competitors, they optimize product mix, focus on key items, and continuously increase per-store output, achieving substantial profits. Zhicheng Trading's category distribution case is worth learning from for the industry! Focus on FMCG distributor new distribution / brand new marketing cases For communication, you can add WeChat by long-pressing. When adding, please indicate your company, position, and name.