---
title: "From Yili Low-Temp to Mengniu Ambient, This Distributor Controls 'Near-Expiry' Products to Keep Shelves Fresh!"
description: "For dairy distributors, pressure is evident: sensitive quality issues, frequent returns, and persistently high inventory levels are common. How should distributors address these challenges? Wu Lijun, a Mengniu distributor in Shangyu, Zhejiang, believes that whether dealing with low-temp or ambient milk, controlling near-expiry products is paramount. Only then can product quality be assured, distributors profit, and the market progress smoothly. Since entering the industry in 2003..."
author: "New Distribution"
publisher: "New Distribution"
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published: "2016-03-12"
language: "en"
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original_source: "https://mp.weixin.qq.com/s/mHU_B_Pgs4I3sDlc8qvZNA"
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# From Yili Low-Temp to Mengniu Ambient, This Distributor Controls 'Near-Expiry' Products to Keep Shelves Fresh!

> For dairy distributors, pressure is evident: sensitive quality issues, frequent returns, and persistently high inventory levels are common. How should distributors address these challenges? Wu Lijun, a Mengniu distributor in Shangyu, Zhejiang, believes that whether dealing with low-temp or ambient milk, controlling near-expiry products is paramount. Only then can product quality be assured, distributors profit, and the market progress smoothly. Since entering the industry in 2003...

For dairy distributors, pressure is evident. Sensitive quality issues, frequent returns, and persistently high inventory levels seem to be the norm in dairy distribution. How should distributors address these challenges?
In response, Wu Lijun, a Mengniu distributor in Shangyu, Zhejiang, believes that **whether dealing with low-temp or ambient milk, controlling near-expiry products is always the top priority. Only then can product quality be assured, distributors profit, and the market progress smoothly.**
Since entering the industry in 2003, Wu Lijun has been dealing with dairy products. Initially, he was Mengniu's city manager in Wuxi, Jiangsu. After a year of training and accumulation, he transitioned to a distributor and successfully secured the agency for Yili low-temp milk in Changshu and Kunshan. In 2009, he moved to Shangyu, Zhejiang, and established Maoxin Trading Co., Ltd., this time choosing Mengniu ambient milk.
From low-temp to ambient, despite the change in product categories, Wu Lijun has not relaxed his control over near-expiry points, which has been key to Mengniu ambient milk gaining a foothold in the Shangyu market.
**◆ Low-temp near-expiry rate below 5% to make a profit**
Like many dairy distributors, Wu Lijun encountered numerous difficulties in the early days of operating Yili low-temp milk, with logistics being the most prominent. Wu Lijun explained that at the time, the Jiangsu region was supplied by Yili's Beijing plant, with deliveries arriving every two days. However, due to the long distance, orders had to be placed six days in advance, meaning two batches were always in transit. Additionally, due to capital and market constraints, initial order quantities were small and did not meet the factory's delivery standards, so he had to pick up goods from the Wuxi distributor himself.
This not only increased the difficulty of inventory management but also wasted a lot of time in transportation. Combined with unstable sales, it easily led to a large number of near-expiry products.
"**As the saying goes, in low-temp, distributors make money from near-expiry products.** Since low-temp milk has a short shelf life, generally less than half a month, transportation takes at least two days, and by the time it reaches the store, it's the third day. The shelf sales time is at most a week. If sales are slow, distributors must guarantee unconditional returns, and these returns often become near-expiry products that are destroyed, with all losses borne by the distributor. Conversely, if near-expiry control is good, distributors can achieve considerable profits," Wu Lijun said. **The near-expiry rate for low-temp milk needs to be controlled within 5 points, meaning that for 100,000 yuan of goods, the final near-expiry products should be less than 5,000 yuan to be considered normal; otherwise, the distributor may incur losses.** Given this, Wu Lijun **started with order planning, warehouse management, and terminal promotions to compress the near-expiry rate to the minimum**; at the same time, sales of Yili low-temp milk in Changshu and Kunshan steadily increased, and the factory began direct supply.
Two years later, Yili established a branch factory in Suzhou, further improving transportation conditions, which created favorable conditions for reducing near-expiry rates. Wu Lijun stated that at that time, the near-expiry rate for Yili low-temp milk was only about 2 points, which not only ensured product profits but also helped the company smoothly through its startup phase. Near-expiry control thus became the primary consideration in Wu Lijun's operations.
**◆ Ambient milk must strictly implement uniform pricing**
Seeking better development, Wu Lijun came to the more economically developed Shangyu, Zhejiang, and specifically registered a trading company. This time, he chose Mengniu ambient milk as his agency product. Discussing the reason for switching products, Wu Lijun admitted that on one hand, the pressure of operating low-temp milk was indeed high, and on the other hand, it was an opportunity. At that time, Mengniu ambient milk's monthly sales in Shangyu were only over 1 million yuan, but the monthly near-expiry products were nearly 10,000 boxes, totaling about 400,000 yuan. Such a high near-expiry ratio was unbearable for ambient milk, not only causing losses for the distributor but also easily leading to quality issues.
Wu Lijun analyzed the reasons, mainly three points: **First, the market foundation was weak; in the ambient milk market in Shangyu, consumers' brand recognition of Mengniu was not high. Second, frequent changes of distributors led to improper handling of terminal customer returns, leaving a bad impression on customers and greatly reducing their enthusiasm for stocking. More critically, the price system was unstable; customers hoarded goods at low prices but couldn't sell them, and when products neared expiry, they demanded returns, which inevitably put great pressure on the distributor. However, refusing returns would lose customer trust.**
After Wu Lijun took over Mengniu, the market situation remained severe, so he decided to start from scratch and effectively control product near-expiry by building a solid market foundation.
First, to restore the company's image in the eyes of customers, Wu Lijun decided to **resolve all previous return issues at once**, including compensating customers who had already disposed of near-expiry returns as free gifts. Wu Lijun said: "**Although the return issues were not caused by me, for the smooth progress of future work, these problems must be properly resolved. The key is to let customers see our sincerity. Only then can we establish a mutually trusting cooperative relationship.**" In this way, Wu Lijun took over all 400,000 yuan of returns in the market.
Second, **re-establish the product price system and implement uniform supply prices.** In Wu Lijun's view, when customers say Mengniu doesn't sell well, the problem is not with the product but with the price. **If distributors do not strictly control prices and blindly favor large customers by lowering prices, it may lead to their retail prices being lower than the supply prices for small shop customers.** For example, for yogurt, the normal supply price to small shops is 32 yuan per box, but some large customers might get it at 30 yuan per box and sell at 31 yuan, which would inevitably harm the interests of small shop customers.
Moreover, if distributors solely consider profit and sales volume while ignoring the smoothness of the entire sales process, they will ultimately suffer greater losses. Some large customers order large quantities, and distributors might think that even a 0.5 yuan profit per box is worthwhile. However, if these goods cannot be fully sold in actual sales, the result is that the more they order, the more they return. Facing these returns, the distributor's losses cannot be compensated by the 0.5 yuan profit. Therefore, stabilizing product prices not only ensures the overall interests of customers and distributors but also promotes orderly and stable market development.
Wu Lijun stated that **now, regardless of customer size, the company supplies at uniform prices. Even if there are discounts, they are controlled within 0.5 yuan per box. Although this has caused dissatisfaction among some large customers, in the long run, it undoubtedly achieves a better win-win situation.**
**◆ Products 'selling well' earns recognition**
Currently, Mengniu ambient milk's annual sales in the Shangyu region have exceeded 20 million yuan, and the annual near-expiry products are only 3,000 boxes, with losses basically negligible. Wu Lijun said that the key to controlling near-expiry for Mengniu ambient milk is that the products are now 'selling well.' **As long as terminal sales are fast, the number of returns naturally drops significantly, thereby effectively reducing the occurrence of near-expiry products. Behind this is terminal service. To improve terminal service quality, the role of salespeople must be leveraged.**
Wu Lijun stated that in the past, it was often the boss who pushed salespeople to maintain customers. Therefore, first, it is necessary to enhance the initiative of salespeople, based on the principle of 'more work, more pay,' telling salespeople, 'This area is fully your responsibility; you are the boss; you are working for yourself.' Second, let salespeople establish a correct service awareness. What is service? Many salespeople think they are one with customers and should jointly earn the boss's money. If a customer says there are five boxes of near-expiry products, the salesperson says there are ten. If a customer says the goods don't sell well and orders less, the salesperson simply says don't order... Salespeople habitually exaggerate customer feedback, masking the real market situation.
Therefore, **it is necessary to let salespeople understand the actual problems customers face and then help customers solve them together.** "Now the company has over 900 outlets in Shangyu, all managed by our salespeople, strictly following a three-day visit schedule for maintenance. Through everyone's efforts, customers no longer say the products don't sell well, no longer bargain, and no longer argue over returns. We also tell customers that they only need to be responsible for receiving goods and paying; we will handle all the rest, including warehouse stacking, shelf display, and date management, so customers have no worries."
Wu Lijun said that to avoid near-expiry products, the company has also strengthened terminal shelf-life management. Products about two months from expiry are exchanged among customers based on sales conditions in different regions, or special promotions and free gifts are organized in stores to ensure smooth sales.
**"When product sales are smooth, we can ensure that products on the shelves are always fresh. More importantly, this allows customers to recognize your brand. In the past, when near-expiry control was not in place, the dates on the shelves were uneven. Customers would rummage through the shelves, thinking that products with better dates were hidden at the back. This is actually a sign of customers' distrust of the brand.**
Now, we ensure that products on the shelves are from the same production batch, and those with slightly older dates are taken out separately and paired with small gifts, such as cups or small toys, at the original price, creating interaction with customers. Customers can choose according to their needs, no longer doubting product quality. This in turn drives terminal sales, fundamentally solving the near-expiry problem." (From WeChat public account: Food Economy)
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