In 2001, he entered the distribution industry and became a leading paper and hygiene products distributor with annual sales exceeding 100 million yuan within 10 years. In 2015, he began attempting regional B2B transformation, losing over 10 million yuan over 4 years. In 2019, he cut off traditional trading to concentrate all energy and resources on B2B, a last-ditch effort. By 2023, he covered 15,000+ local small stores, with 5,000+ monthly active outlets, 8,000+ SKUs across categories like beverages, snacks, grain and oil, daily chemicals, and achieved annual sales of 300 million yuan. This is the development history of Yijia Zhixing. The final result is successful, but it is hard to imagine that a traditional distributor began attempting regional B2B transformation in 2015 and, after four years of continuous losses, still dared to invest all resources to fight. How did the founder think? How did he achieve this? With these questions, the author visited Hu Wei, founder of Yijia Zhixing, in Nanning. During the two-hour exchange, Mr. Hu Wei shared his practice of transitioning to B2B and his thoughts on the distribution business. Initial B2B Attempts Was Foolhardy Before entering the distribution industry, Hu Wei worked in a non-ferrous metal enterprise. Later, the enterprise dissolved, and Hu Wei took up a job as a second-tier distributor for hygiene products, officially entering the FMCG industry. In 2001, Hu Wei started his own business, establishing a trading company mainly dealing in paper and hygiene products, covering local KA and small and medium supermarkets. After more than a decade of steady development, by 2013, sales exceeded 100 million yuan, making him a leading distributor in the local paper and hygiene products sector. It was in this year that he established cooperation with Eternity, which alleviated financial pressure and further expanded some channels and brands. But at this time, Hu Wei already felt market changes; under the impact of e-commerce, supermarket business was affected. The most direct changes: first, increased supermarket fees; second, upstream manufacturers began to pass on sales pressure. So in 2015, Hu Wei began trying a web-based B2B ordering platform. The initial idea was still from a trading perspective: having always done supermarket business, now through B2B he could do small store business. Hu Wei told New Distribution that when he first started B2B, it was indeed "foolhardy," encountering many twists and turns. Insufficient understanding of the B2B model, early on still using traditional product thinking, led to some directional decision errors, and from 2015 to 2019, he remained in a loss-making state. During this phase, losses were severe, and Eternity planned to stop the project. But Hu Wei believed the model itself was definitely not problematic and had a promising future, so he chose to buy back equity, bear debts of over 10 million yuan, and persist. In April 2019, he completed industrial and commercial procedures and made a formal handover. After switching systems, Hu Wei proactively cut off traditional trading business to concentrate resources and energy on B2B. Why did Hu Wei persist with B2B despite four consecutive years of losses? Hu Wei told New Distribution that although these years were loss-making, the overall trend was improving, and it made him feel the business was healthier. First, he gained control over market operations. Traditional trading is brand-led. The distributor's role is to take money, advance funds, and stock inventory, then sell specified goods in specified areas and places; what to sell and how to sell is more dictated by the manufacturer. In B2B, the business initiative is in his own hands. The role change gave more room to maneuver: he controls the product assortment and terminal relationships. Second, B2B extended his ability to build a channel moat. In traditional trading, it is difficult for distributors to do cross-category business because category characteristics differ greatly; crossing categories is like crossing industries. B2B ultimately does full-category business, requiring cross-category management capability in organizing the product assortment. Through these four years, Yijia Zhixing gradually developed methods and strategies for cross-category management. At the same time, warehousing and distribution capabilities and store fine management capabilities were effectively improved. Third, business stability and plasticity increased. In traditional trading, accounts receivable are the most troublesome, especially with supermarkets, which have long payment cycles and many bad debts. B2B is a cash-flow business: payment before delivery, making the capital pool more stable. Moreover, Yijia Zhixing expanded more corporate group purchase business through B2B. Previously, corporate group purchases were usually from large supermarkets, simply because they had a full range of goods, many SKUs, and could be freely combined. Yijia Zhixing can do better than supermarkets. It can meet product needs, but it can also do separate sorting to help enterprises achieve personalized customization. Finally, persistence paid off. Through five years of full investment, Yijia Zhixing now covers 15,000+ outlets, with business growing several-fold and stable profitability. At the same time, warehouses have been opened in Guilin, Beihai, Fangchenggang, Guigang, Binyang, Pingle, Xing'an, Quanzhou, etc., in Guangxi, with plans to complete full coverage of Guangxi by 2025. Four Core Elements of B2B: Organization, Products, Stores, Operations From 2015 to now, over 9 years, Yijia Zhixing has gradually formed a complete operating system in the process of doing B2B, from exploration to maturity. Hu Wei told New Distribution, "For distributors transitioning to B2B, it is both complex and simple." Complex because the underlying logic differs from traditional trading: one serves brands, the other serves stores. Simple because, when broken down, doing well in the five modules of organization, products, stores, and operations can lead to a stable state. In organizational management, B2B and traditional trading have different operating logics, and organizational structures also differ. Yijia Zhixing's organizational structure is divided into five departments: System Business Department, Purchasing Department, Sales Business Department, Warehousing and Logistics Department, and Finance Department. The System Service Department mainly maintains software systems regularly. The Warehousing and Logistics and Finance Departments are not much different from traditional trading companies. Here, we mainly share purchasing and business management. Purchasing is mainly responsible for product selection, delisting, and activity plan formulation. Divided by category: beverages, snacks, grain and oil, daily chemicals, with 2 people per group. Its core assessment has two dimensions: gross margin and out-of-stock rate. For example, gross margin: whether a product's margin is 10% or 15% corresponds to different reward amounts; out-of-stock rate is a guarantee for maintaining assortment stability, and different overall out-of-stock ratios correspond to different reward amounts. Business is mainly responsible for information transmission, store development, ordering, and service. Divided by area, each business person follows up on about 200+ outlets. Salespeople's wages are mainly divided into two parts: 40% base salary + 60% incentive bonus. The incentive core is divided into: customer activity bonus + customer level bonus + brand execution reward. In product management, the core principle: product structure must be based on store needs. How does Yijia Zhixing ensure products meet store needs? First, look at data from nearby convenience stores, obtain product structure data from a dozen stores, find the TOP 2000-3000 SKUs, and compress the overall SKU count to 2000-3000. Second, in product structure, still based on category, combine first, second, and third-tier products, corresponding to different price bands. In terms of specifications, mainly do convenience store specifications, small sizes like travel packs and portable packs, avoiding large sizes as much as possible. At the same time, collect long-tail needs from stores. Although the volume per store is small, with many stores, the base becomes large, and profits are more objective. Third, for categories with low brand concentration, prioritize second- and third-tier profit brands. For example, short-shelf-life categories are hot under the health trend. Products with 7-day, 30-day, or 60-day shelf lives do not yet have strong brand mindshare, so regional brands can be chosen. In store management, it is clear that B2B users are small and medium stores, and all actions revolve around how to increase store productivity. For small and medium stores, the underlying needs are nothing more than product supply, product price, logistics distribution, and store service. Some distributors doing B2B easily fall into the trap of price wars. One point to emphasize: price competition has no end; there are many competitors, and you cannot be lower than all platforms, nor can you outspend capital. So distributors should do well in comprehensive capabilities: product supply, product price, logistics distribution, and store service. Scoring 70 points in each dimension will definitely result in a higher overall score than scoring 90 points in only one dimension. In operations management, B2B is a routine job. The front-end apps and mini-programs of various platforms are similar, requiring not much operational skill. The core point to note: B2B and B2C customer attributes are completely different—one is store owners, the other is consumers. Never copy B2C operational methods directly to B2B. Thoughts on Transitioning to B2B See Changes, Find the Right Direction, Persist The problems distributors face now are fundamentally more about changes in the market soil. Currently, no regional supermarket is not declining or anxious. Anxiety means change. The core of all change ideas is: optimize product structure centered on consumer needs. For distributors, the most direct impact is zero-supply integration. If regional supermarkets are reformed well, with zero-supply integration and distribution integration, reducing the number of distributors and raising requirements for distributor capability and quality; if reformed poorly, closures and runaways occur, and distributors are the most hurt. In such an environment, if distributors do not change their business thinking, difficulties are inevitable. Of course, many distributors ask: in which direction should we transform? In fact, there are many successful transformation cases: some succeed with B2B, some with community group buying, some with online transitions... All roads lead to Rome. The key is to find a direction suitable for yourself and consider three questions: Can you persist? Can you overcome difficulties? Are you afraid of losing money? Once you have this determination, go all out.