---
title: "How County-Level FMCG B2B Can Develop"
description: "Currently, FMCG B2B is booming nationwide, with both self-operated and matching models accelerating their layout. According to Kantar Retail China's annual report, Alibaba Retail Link, JD New Path, Zhongshang Huimin, and Zhanghe Tianxia are the first tier in the market. County and township markets account for 51% of terminal retail stores nationwide, but mainstream FMCG B2B players focus on T1-T3 markets, leaving T4-T6 in a state of warlord-like competition."
author: "张桥"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2017-01-18"
language: "en"
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# How County-Level FMCG B2B Can Develop

> Currently, FMCG B2B is booming nationwide, with both self-operated and matching models accelerating their layout. According to Kantar Retail China's annual report, Alibaba Retail Link, JD New Path, Zhongshang Huimin, and Zhanghe Tianxia are the first tier in the market. County and township markets account for 51% of terminal retail stores nationwide, but mainstream FMCG B2B players focus on T1-T3 markets, leaving T4-T6 in a state of warlord-like competition.

Currently, FMCG B2B is booming nationwide, with both self-operated and matching models accelerating their layout. According to Kantar Retail China's annual report, Alibaba Retail Link, JD New Path, Zhongshang Huimin, and Zhanghe Tianxia are the first tier in the market.
Figure 1. 2016 FMCG Internet B2B Market Research
**In terms of scale, county and township markets account for 51% of terminal retail stores nationwide. Mainstream FMCG B2B players are mostly deployed in T1-T3 markets, while T4-T6 (county and township markets) are still in a state of warlord-like competition.** For example, in Hunan, which I am familiar with, there are regional B2B e-commerce platforms such as Xingaoqiao, Furong Xingsheng, Wanshang Yizhan, Huosuda, Lilai Yipi, Bubugao B2B, 86077, Xiangcungou, Yuncaihui, and Diandan Jidao.
Figure 2. 2016 FMCG Internet B2B Market Research
**County-level FMCG B2B is currently a fiercely competitive but relatively weak segment in the market.** Regional platforms have significant gaps in capital, talent, technology, and services. At the same time, after the 2016 FMCG B2B exposure and the impact of Rural Taobao, county-level distributors have improved their awareness of the internet. From the distributors I have contacted, they are basically aware of future development trends, but they are confused about how to proceed.
Due to the high logistics costs caused by the vast geographical area, county-level FMCG B2B platforms prefer the matching model, integrating local distributors for joint operation and cooperation. After establishing terminal stickiness through cooperation, they gradually move to self-operated second- and third-tier brands to gain gross profit. In the mainstream FMCG B2B discourse, unified warehousing and distribution is the ultimate model, but finding a suitable unified warehouse in county areas is often difficult, involving costs for moving goods and warehouse management. **Therefore, in the early stages of development, adopting unified distribution with pickup delivery or small-scale stocking, while integrating county express and logistics for dedicated line delivery, can effectively reduce distribution costs and increase full-load rates.**
Specifically, the development path for county-level FMCG B2B can be as follows:
**1. Marketing first, logistics follow**
In county business, the first thing is familiarity (credibility), followed by strength. For initial entry into county-level FMCG B2B, it is best to have a reputable local distributor take the lead. At the same time, traditional marketing methods such as outdoor advertising, local WeChat influencers, promotional gongs and drums, and outdoor booths should be implemented immediately. Since county towns are usually small, brand awareness can be quickly established in the short term. **At the same time, integrate at least 4 (purchased or leased) 4.2-meter box trucks, paint them with brand appearance, and provide same-day delivery to cooperative distributors through pickup delivery, demonstrating distribution strength.**
**2. Dedicated line delivery, special price attraction**
After completing the initial market introduction, plan dedicated delivery routes based on the delivery paths of early cooperative merchants, and arrange ground promotion personnel to promote the platform and maintain customer relationships along the routes. In the early stage when order volume is not saturated, negotiate with local express and logistics companies for township delivery and pickup services (usually 1 yuan per piece for express, 5 yuan per piece for LTL) to supplement single-vehicle revenue.
**For special price attraction, two methods can be considered: First, develop limited chain-type terminals.** Replace store signs, introduce express pickup and delivery, recharge and payment services, and provide subsidies and discounts to such terminals on platform orders, generating word-of-mouth publicity locally. **Second, the platform subsidizes weekly promotions of first-tier category specials** to form consumption habits, attract terminal stocking, and drive additional sales.
**3. Customer relationships first, model innovation**
In the county market, salespeople are the core link, handling sales, display, delivery, after-sales, and significantly influencing terminal owners' purchasing decisions. **How a county-level FMCG B2B platform utilizes salespeople without conflicting with their business is key to the platform's promotion and operation.** Consider using a visit-sales system to enable order placement on behalf of customers and assist in managing salespeople's customer groups, while the platform provides appropriate incentives to salespeople. In terms of model innovation, **first, consider adopting a universal visit-sales model,** where all county residents can register as system salespeople, leveraging the sharing economy. Registered salespeople conduct visits and earn actual product sales profits, freeing some distributors from being tied to salespeople. **Second, develop group wholesale,** where the platform organizes terminal retailers to purchase together to obtain the original wholesale prices from county second-tier distributors, reducing terminal procurement costs and increasing terminal recognition of the platform.
**4. First-tier attraction, second-tier profit**
In the industry, the profit points for matching-model FMCG B2B are usually platform commissions, supply chain finance, and value-added services, but these are difficult to achieve in county markets. Distributors are unwilling to be deducted, capital cost requirements are low, and value-added services are hard to implement, making it difficult to generate revenue. Based on my company's current practice, **by introducing relatively low-priced first-tier products to attract terminal retail aggregation, then negotiating with second- and third-tier brand manufacturers for distribution after the situation opens up, and also representing some high-margin products, while charging service fees through dedicated line delivery, we can basically cover the operating costs of a county company. However, this tends to turn the county company into a large local distributor, deviating from the platform's original intention.**
The above provides a thought on the development of county-level FMCG B2B. FMCG B2B is the future trend of the industry, but for a regional matching-model FMCG B2B platform, how to profit, how to coordinate relationships with local distributors, continuous capital investment, and team execution are major challenges. Borrowing a quote from Jack Ma: **Today is cruel, tomorrow is crueler, and the day after tomorrow will be beautiful, but most people die tomorrow night and never see the sun of the day after tomorrow. So we must persist in whatever we do!**
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