---
title: "Genki Forest's Return to Tradition: Becoming 'Partners' with Distributors"
description: "Genki Forest has outlined four principles for cooperating with suppliers: 'partnership, closeness and clarity, cost reduction, and openness.' After a year of institutional refinement, organizational restructuring, and direct communication, equality, integrity, and transparency are now the new definitions of the 'partnership' between Genki and its distributors."
author: "林辰"
publisher: "New Distribution"
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published: "2023-12-23"
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# Genki Forest's Return to Tradition: Becoming 'Partners' with Distributors

> Genki Forest has outlined four principles for cooperating with suppliers: 'partnership, closeness and clarity, cost reduction, and openness.' After a year of institutional refinement, organizational restructuring, and direct communication, equality, integrity, and transparency are now the new definitions of the 'partnership' between Genki and its distributors.

**Introduction**: Genki Forest's four principles for cooperating with suppliers: "partnership, closeness and clarity, cost reduction, and openness."
**Source**: Caijing.com.cn | **ID**: caijingwangwx | **Author**: Lin Chen

"We internet folks coming into the FMCG industry shouldn't get carried away; we all need to go to the market and learn from the front lines." At the beginning of this year, founder Tang Binsen made this blunt statement to management at Genki Forest's annual meeting. It's not hard to imagine what he heard when he visited distributors during one of the most difficult periods for both Genki and its distributors.

From the honeymoon phase of entrepreneurship where both sides made money and broke through their inherent social strata, to problems like aggressive ordering plans, information loss in delivery handovers, inventory turnover challenges, and corruption in regional allocations, and then to the founder personally promising distributors a "fresh start" and the dismissal of former marketing center head Ye Licheng for major corruption, **Genki Forest has, in just over seven years, gone through a growth adolescence of rapid acceleration, kinetic energy transition, and compliance catch-up.**

After Ye, Genki's new marketing center head Fan Jun took office. **After a year of institutional refinement, organizational restructuring, and direct communication, equality, integrity, and transparency are now the new definitions of the "partnership" between Genki and its distributors.**

"The money we lost last year on old stock has already been compensated by the regional office."
"We no longer ship on a whim; all orders now require QR codes and regular periodic reviews."
"We set safety stock levels and run activities with plans and themes, improving the match between production and frontline feedback."

At the recent Genki Forest 2023 National Distributor Conference, several distributors who had chosen Genki when its market was still blank took the stage to share their ups and downs with the brand. Many had been hurt and wavered, but now they have reaffirmed their commitment to long-term partnership with Genki.

"In our eyes as distributors, the relationship between manufacturer and distributor is like a romance. The manufacturer is like the man, and the distributor is like the woman. They are attracted to each other by their traits and come together, but whether they can go the distance and become husband and wife requires effort and consideration from both sides, with the manufacturer perhaps giving a bit more. If one side develops faster and the other can't keep up, divorce can happen," said a distributor with over 20 years in the FMCG industry.

"What Genki has built with distributors and suppliers is not just a business relationship but a deep partnership based on shared experiences and trust," Tang Binsen also proposed at the conference the **four principles for Genki Forest's cooperation with suppliers: 'partnership, closeness and clarity, cost reduction, and openness.'**

"When we look at a company's prospects, taking some detours is perfectly normal," said the distributor who entered the industry in 1998 and became Genki's first distributor in South China in 2016. He believes the key is not "how smart or powerful you are, but whether you have the ability to correct mistakes."

At the annual distributor conference, founder Tang Binsen also specially invited several distributors who had weathered storms with Genki and might have some "grievances" to speak. "This helps us better see the mistakes we've made and deeply analyze whether we still have a chance to correct them."

**"These Genki folks have a certain stubbornness"**

"In the early days, we were all poor brothers. I didn't look down on Genki, and Genki didn't look down on me," said Liu Yukun from Yantai, one of Genki Forest's earliest distributors. In 2017, because he felt there were no good products on the market, he went to inspect local markets. When he visited a beverage factory in Hefei and found the product too sweet, a friend mentioned a new product marked with the character "燃" (burn) on the phone, which piqued his curiosity.

"I remember it was a Saturday. After hanging up, I searched online for this 'Ran' and tried to contact customer service, but no one answered. Then I went to Taobao, and the customer service there recommended the person in charge at Genki. By then it was already Sunday. There were no sleeper tickets on the train to Beijing that day, so I bought a standing ticket and sat in the dining car all night to get to Beijing."

Liu Yukun recalled that at the time, Genki's office in Beijing was small and the environment was too "simple." He went to a Wumart supermarket, bought a bottle of Ran Tea, tasted it, and felt that with the concept of sugar-free tea just emerging, he should "grab" a few products to sell.

"We talked for 40 minutes and decided to cooperate. At that time, no one was managing the entire Shandong market. Genki said no deposit was needed, but I was afraid that if I left, someone else might come and take the Yantai market. So I insisted on paying a deposit to feel secure."

Liu Yukun, who made the decision on the spot, received the first batch of goods a few days later. That year, he tested the waters and achieved over 600,000 yuan in sales in Yantai with Ran Tea as the main product. Even after choosing to focus on finer operations and shrinking his territory, his scale has now expanded to nearly 10 million yuan.

**As a rapidly growing emerging consumer brand, Genki Forest has not only disrupted the market landscape with its products but also given many distributors a rare opportunity to break through entrenched circles.**

Tang Qiang, who has been in FMCG for over 20 years and founded his own trading company in 2013, started cooperating with Genki in 2018.

"I've done many products from the big FMCG players, but these are already mature in the local Chengdu market. I was hoping for a new business opportunity," Tang Qiang recalled. He had been thinking about how to break through bottlenecks since 2016. On one hand, the profit margins traditional brands left for channels were shrinking; his own carbonated beverage business had over 10 million yuan in sales but actually lost tens of thousands of yuan. On the other hand, he found that while a certain domestic brand had leading awareness and penetration across age groups, "kids don't drink them anymore," showing a disconnect with the new generation's consumption habits.

**The market and distribution channels were eager for a brand that could bring change, but for an outsider like Genki, that didn't mean it would be smooth sailing.**

"To be honest, Genki's early products like 'Mingming Bu Pang' and 'Shi Fen Mei Li' weren't very good," Xu Zaohui, who entered the FMCG industry in 1998 and started his own business after being a regional manager, said bluntly. As distributor number 005 and Genki's first distributor in South China, he revealed that his connection with Genki came through a former colleague who was responsible for Genki sales. Out of a desire to help and trust his friend, he first tried ordering a few tens of thousands of yuan worth of goods.

"I pushed Genki into the largest convenience store chain in Fujian, but after three or four months on the shelves, sales were less than 10,000 yuan. There was also a batch of goods with dented bottles. Normally, after something like that, Genki would have been delisted from the convenience store. But out of trust in Genki, Xu Zaohui chose to keep Genki on the shelves."

And the subsequent hits paid him back—after the fruit tea launched, it sold 800-900 boxes in Xiamen in a month. With the launch of Ran Tea, Genki officially gained a foothold in the Xiamen market. The birth of sparkling water then elevated the brand's status.

At the same time, as one of the earliest risk-takers to secure distribution rights, Xu Zaohui seized the "opportunity to grow with a new product and a new company"—in 2023, his Genki business reached 23 million yuan, accounting for about a quarter of his own company's revenue.

Tang Qiang, the Chengdu distributor mentioned earlier, also achieved his goal of breaking the local entrenched distribution structure—in 2018, his Genki business of 1.5 million yuan was less than one-twentieth of his company's 40 million yuan revenue. But by 2023, Genki's 54 million yuan volume accounted for 60% of this Chengdu major distributor's business scale.

"Objectively speaking, Genki's professional capabilities aren't the strongest in the industry, but they have a tenacity, a 'foolish' spirit," said Ma Laicheng, a distributor in Zhengzhou doing 20 million yuan in Genki business, who has cooperated with several well-known domestic and international beverage brands.

"Genki's people visit 40 to 50 customers a day, constantly focusing on distribution, store execution, and displays. When we follow the truck to deliver goods, Genki's brothers also leave at 7 or 8 in the morning and are still on the road until 9 or 10 at night, organizing shelves and freezers. They really have a stubbornness."

"I remember when sparkling water was still a niche category just starting to rise, Genki said they would spend money on advertising next year," Xu Zaohui mentioned. When he saw bus stops and subways full of Genki ads, he thought the company was "really crazy."

**"I once grew up with the brand; I hope to continue accompanying it in the future."**

Genki, which was at its peak and attacking various categories, soon felt the risks inherent in innovation. An Ming, a distributor from Qingdao, admitted that he made money from sparkling water in 2021 but lost money in 2022 due to shipping rhythm issues.

"In 2021, milk tea sold well, so in 2022 I ordered a lot. But in January there was a shortage, and in March and April, 10,000 boxes of the same flavor suddenly arrived—it was like 'opening a blind box'—I didn't know what flavor was coming, let alone when the goods would arrive." Since April was no longer the peak season for milk tea, and May brought new challenges for milk tea, An Ming had to discount the near-expiry products in August.

Besides the mismatch in milk tea sales rhythm, the surging sparkling water also tripped up An Ming.

It is reported that in 2021, his sparkling water sales in two districts of Qingdao were about 7 million yuan, with a target of around 10 million yuan the next year, but the sales manager at the time gave him a task of 28 million yuan. Under such pressure, the first quarter's prepayment alone was 5.6 million yuan.

"I felt Genki was being a bit aggressive, but I couldn't reason with the supervisor. I was particularly upset and gave up one district to shrink my scale." Although he controlled the risk in advance, he still suffered losses due to the same "blind box" problem as with milk tea.

"In 2021, the sakura-flavored sparkling water sold very well. We had stocked the shelves by May, and because it was so popular, we couldn't get more in July and August. But in 2022, it suddenly stopped selling, and eight truckloads came in at once. Meanwhile, the main sellers like white peach, calamansi, and black grape were out of stock, which was completely different from the purchase plan I had submitted." An Ming admitted that losing over 300,000 yuan that year was heartbreaking, especially when he had to destroy a batch of goods and looked at the piles of bottles. He was ready to quit after settling the fees.

"Genki's production and sales did have some problems during that period," Tang Qiang said. FMCG products are all about freshness, but he found that in January he received goods produced in December of the previous year, in February he got goods from December again, and in March it was the same date. "I asked the factory, 'Don't you produce new ones? Is there no production plan? Do you just produce a huge batch on a whim, then pile it up and force it down?'"

**The chaotic shipping rhythm directly affected terminal sales arrangements.** Tang Qiang was helpless; when Genki saw large inventory, it would run promotions, but no one knew why—it was just for the sake of doing something.

**Losses and reallocation of territories are often the most sensitive areas that hurt distributors' actual interests and emotions.** "At that time, Genki sent the head of the digital center department to review the accounts with me, and we calculated that I lost over 200,000 yuan in August," Xu Zaohui mentioned. When Genki adjusted the regional structure in Xiamen in October, the regional manager suggested he give up the traditional channels that had been losing money.

"In business, if you lose, you lose. Why can others do it and I can't? I grew up with the brand, but when it grew up, the territory became someone else's," Xu Zaohui said with some grievance. He even considered calling Tang Binsen but hesitated, thinking he should understand the brand's decisions at different stages. In the end, he stayed to weather the storm with Genki.

**"Before, I could only see the supervisor; now I've even added the founder on WeChat."**

The conflict between distributors and Genki reached a breaking point and needed an outlet.

At the online distributor conference in September 2022, Tang Binsen gave a speech themed "Fresh Start," admitting, "In the past seven years, we've been too lucky. Our products are okay, but we've exposed some problems... In the long run, relying on distributors to develop our sales network is the right path. The so-called decentralization and 'internet thinking' might be poison; we don't understand sales well enough."

He also acknowledged that **due to improper distributor strategies, some distributors suffered both economic and emotional blows, leading to attrition in the team.**

"At least Genki can face the problem head-on, which is different from other companies," An Ming, who was ready to quit, decided to stay and try again—the newly appointed Shandong provincial manager Wang Jian found An Ming and promised to restore the market to normal, from shipping rhythm to the mix of flavors per truck.

**"Before, I could only see city managers and supervisors; now I've met leaders from the province to the region to headquarters. I've even added the founder on WeChat."** An Ming felt that few large companies could change so quickly and so thoroughly.

He also discussed a new project with Genki—the first pilot of personnel co-building in Shandong. The brand pays the base salary of the co-built sales staff, and the distributor pays the performance commission. During the co-building period, everyone works together and shares the ups and downs.

"Management itself is my weakness, but Genki's management of the co-built personnel has helped me a lot, and the overall market performance has improved significantly." After nearly a year, An Ming's confidence in cooperating with Genki has finally stopped wavering.

Tang Qiang and Xu Zaohui, who were in Chengdu and Xiamen and had suffered from shipping delays, also ended their days of being forced to "sign off on goods on a whim."

"My inventory peak in 2021 was unimaginable to outsiders. Even in 2022, there was a period when my cash flow could only cover three months of salaries. But even then, I didn't cut salaries or dump goods at low prices," Tang Qiang said. Now, he orders with Genki on a monthly basis following the "532" rhythm: 50% of the goods in the first week, 30% in the second, and 20% in the third.

"This way, performance moves forward and inventory stays relatively healthy. Activities are also planned and themed." Tang Qiang believes that Genki's production head has many years in the FMCG industry and understands how much the market cares about shelf life. "It's not an exaggeration to say it's a race against time, but the match between production and frontline feedback has indeed improved."

According to Xu Zaohui, **orders are now based on market sales to set safety stock levels.** Compared to the old model where if the target was 1 million yuan, you had to take 1 million yuan worth of goods, now Genki and he **derive order quantities based on market demand and safety stock conditions, factoring in weather and other variables, to avoid large backlogs of old stock in distributor warehouses.**

"Before, I didn't know what goods were coming; when they arrived, I had to sign for them, and I couldn't refuse. Now orders require QR codes and reviews. Although reviews can't fully capture the local market situation, it's much better than the old 'shoot from the hip' approach. Few companies in this industry do it this meticulously," Xu Zaohui revealed. He also received compensation from the Fujian region for the losses on old stock he had to clear last year.

**"Distributors and brands: money alone doesn't make the relationship solid."**

With the sales rhythm back on track, Genki and its distributors have also restarted product and channel innovation.

"Now, in my 17 million yuan turnover, Alien electrolyte water accounts for over 30%. Isn't that a lot of potential?" Xu Zaohui is optimistic about this product that performed flat initially but has grown rapidly in the past two years. But he also warned the brand that some new entrants in this track have a certain advantage in capacity-to-price ratio. If consumers can't feel a clear difference in taste and brand image between products, it will pose a significant challenge for Genki.

"For example, the small-pack milk tea now sells better than the large pack. Also, the sugar-free tea segment has been educated by peers for ten years, so the industry leader has a large share. To be frank, Genki still needs to put in more effort to catch up with the top few," Xu Zaohui analyzed.

"Genki has a hit product every year—is that luck?" Liu Yukun found that the 900ml large-pack ice tea sells very well in second- and third-tier cities. "It might not perform well in Beijing, Shanghai, and Guangzhou, but this product is especially suitable for counties and districts, even small stores, including internet cafes. Many construction workers are willing to drink it. So I recently talked with distributors in Zhaoyuan and Longkou, and we must do well with this product next year."

Aiming at new potential products, Liu Yukun also has new ideas for channel development in Yantai. At this year's Genki Forest Shandong Distributor Conference, the only two scenic area projects approved were Mount Tai and Yantai's Yangma Island. "Small counties can't compare with Beijing, Shanghai, and Guangzhou. We often have few people on the streets at 8 or 9 in the evening. So if we can seize the opportunity with internet-famous scenic spots and large dining clusters, there are targeted expansion opportunities," Liu Yukun revealed.

**Working for Genki and for themselves is the path of self-improvement for these distributors.**

"In the past, cooperating with other brands was mechanical distribution. We were just logistics providers and delivery men, which didn't mean much for our own development or channel operations," said Ma Laicheng, who is in Zhengzhou and is Genki's second local distributor, with his Genki business exceeding 20 million yuan in Zhengzhou.

He himself has grown from a small team of two or three people to a major distributor whose logistics, warehousing, finance, and sales are all aligned with Genki. It is reported that his direct supply model is gradually being implemented in 2023, focusing on direct operations in university towns and special channels within a 10-kilometer radius of the warehouse.

"Data-driven decision-making is a big difference between Genki and other brands," Tang Qiang noted. Whenever Genki launches a new product, it first collects feedback data online, then decides whether to pilot offline. Even if it does, it first tests in a few provinces before rolling out nationwide. "So when I launch new products in Chengdu, I also first test in a few outlets and look at the data, unlike before when I'd set up many points of sale for a new product and then find it didn't sell and had to pull them all back, causing big losses."

Tang Qiang has also embedded data-testing thinking into his company structure. His newly established data department, though currently with only one person, can collect all data for analysis to support sales. "Our internal communication and decision-making are now based on data and facts, not on a whim."

**The exchange of tactics and principles is a deeper level of conceptual communication between Genki and its distributors.**

"Many companies reward with money or cars, and some give tactical explanations for market operations, but few talk about products, market trends, or strategic matters," said Liu Yan, a major distributor who once sold more Genki products in Hohhot than a certain international beverage giant. She felt that the two lessons she heard at the distributor council organized by Genki made her feel that Genki treats her as an insider for mutual growth.

"Genki's local offices hang their value slogans on the wall. Every time I visit their office, I like to look at them. For example, 'Eliminate falsehood and grandiosity'—I've transplanted that into my company as 'Lying and fabricating data is digging a grave for the company.'"

Liu Yan wants to learn how to shape a company's cultural tone beyond just making money. She believes that **the relationship between distributors and brands is like a marriage. "It's not that money makes the relationship solid, but that both sides can grow and improve together in the process of cooperation, achieving each other."**

Fan Jun, head of Genki Forest's marketing center, who has made repairing distributor relationships and rebuilding partner confidence a major focus over the past period, mentioned at the recent Genki Forest 2023 National Distributor Conference that Genki's ability to achieve stable growth in electrolyte water share and new tea beverage market layout this year is inseparable from the companionship and contribution of distributor partners. **"Genki and distributors are not just partners in co-operating the market; they are a deep cooperative relationship that works together and shares results in the face of challenges."**

Fan Jun, Head of Marketing Center, Genki Forest

For distributors who have experienced business roller coasters and various process mishaps, transcending the utilitarian tool identity of pure performance orientation and management obedience to become market roles that are mutually respectful and bring value-added is their new adventure with this young brand, Genki.

In Fan Jun's experience, without the "growing pains" of the past period and the companionship of distributor partners, he might have needed more time and energy to deal with historical issues. But now, **in the process of solving problems together, both sides have completed some "transformation" and "growth."**

**According to insiders, after a year of channel optimization and layout, Genki's customer churn rate has dropped by 23%, now controlled within single digits.**

"Regarding the shipping and inventory issues that distributors previously complained about, the company has, on one hand, maintained healthy inventory turnover under the strategy of distribution-based ordering, with significant improvements in turnover days and shelf-life structure. On the other hand, it has optimized supply chain capabilities to make main product supply more reliable and shipping more flexible, ensuring efficient operations," he introduced. Genki has opened a green channel for self-pickup and improved multi-SKU truck-sharing solutions. "After improving fulfillment capabilities, orders for main products from outside increased by over 20%."

**In terms of improving terminal distribution, Genki added 350 new distributors and expanded into 143 new county-level cities. It also increased subsidies for co-built personnel and supply chain finance, providing over 90 million yuan in rebate support.**

"After expanding the outlet base and increasing outlet activity, distribution increased by 800 million yuan year-on-year," the insider said. In particular, seizing the undervalued school channel and leveraging the combined force of packages, large displays, and marketing, sports channel outlets expanded nearly twofold, with sales growth reaching double digits.

**In the eyes of many industry practitioners, Genki Forest's past year has been about learning from tradition, with the founder continuously going deep into the sales front lines, the sales team driving bold changes, fulfilling promises in practice, and truly planting the seeds of 'responsible and reliable' in the hearts of distributors.**

"A company's success should be based on long-term value creation and a healthy corporate culture, not on short-term tactics," Tang Binsen said in his speech at the conference. He believes that **openness means not only accepting new ideas and technologies but also achieving transparency and interaction in all aspects of business operations.** If a company or individual cannot effectively communicate and interact with the outside world, it cannot sustain development.

"Many companies mistakenly believe that keeping secrets is key to competitiveness, but true competitiveness comes from capability building," Tang Binsen said. What Genki has built with distributors and suppliers is not just a business relationship but a deep partnership based on shared experiences and trust. And partnerships should be equal, honest, and transparent.

At this year's distributor conference, Xu Zaohui, who has been with Genki for eight years, publicly shared his New Year's wish: "I hope that one day, I can become a shareholder of Genki."

This distributor, who had his grievances, wore the conference's uniform Genki hoodie and stood on the stage in Xiamen, where he works, to receive the 2023 National Best Partner Award.

During the group photo, Tang Binsen stood aside, placing his hand on the shoulders of these partners.


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