---
title: "Key Factors Restricting Distributor Development and Seven Steps for Distributors to Control Channels"
description: "Objective reasons include changes in the business environment and retail formats, intense brand competition, high terminal entry and maintenance costs, and inadequate market protection. Subjective reasons include limited capabilities, complacency, family management, over-optimism, and poor negotiation with manufacturers. To control channels, distributors should follow seven steps: customer screening, relationship cultivation, personnel training, off-season maintenance, model reference, promotion planning, and inventory management."
author: "New Distribution"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2017-08-18"
language: "en"
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---

# Key Factors Restricting Distributor Development and Seven Steps for Distributors to Control Channels

> Objective reasons include changes in the business environment and retail formats, intense brand competition, high terminal entry and maintenance costs, and inadequate market protection. Subjective reasons include limited capabilities, complacency, family management, over-optimism, and poor negotiation with manufacturers. To control channels, distributors should follow seven steps: customer screening, relationship cultivation, personnel training, off-season maintenance, model reference, promotion planning, and inventory management.

**Objective Reasons**
1. Changes in the business environment and retail formats have raised the bar for distributors' capabilities and strength. Those who keep up move forward; those who don't are ruthlessly eliminated.
2. Intense competition among brands has dragged distributors into a battlefield. Original margins must be used as resources for market competition, such as terminal image investment, gifts, and promotional discounts.
3. High terminal entry and management/maintenance costs make it difficult for products and brands without distinctiveness to survive, forcing distributors to follow suit when products are pulled from shelves. Especially in high-end terminals in Shanghai, Beijing, and Guangzhou, foreign brands have gradually occupied the space.
4. Inadequate market protection, such as counterfeit products flooding the market, disregard for market rules, and weak intellectual property protection, leaves legitimate brands and distributors with no place to thrive.

**Subjective Reasons**
1. Distributors' limited strength and capability, coupled with slow adaptation to channel evolution, always lagging behind.
2. Distributors' complacency with small successes and low external survival pressure, leading to neglect of further business development.
3. Typical family-run operations that refuse to introduce capable and strategic professional managers, thus being left behind by newcomers.
4. Over-optimism about the environment, resulting in their living space being squeezed by other brands and distributors.
5. Poor negotiation with manufacturers or brands to secure policies and support beneficial to their development and market expansion, or even deteriorating relationships, ultimately losing great opportunities.

Objective analysis shows that on one hand, the intensification of business formats and market competition, and on the other hand, the slow improvement of distributors' capabilities, significantly restrict their rapid development and capability enhancement. This causes many distributors' businesses to shrink rather than grow with market expansion, leading to reduced profitability, chaotic management, and even eventual exit from the industry.

Reality tells us that to establish channel dominance in a region, objectively analyzing one's strengths and weaknesses and actively pursuing operational breakthroughs are key to sustainable development.

As the saying goes: "He who controls the channel controls the world." Distributors hold a local market; their short-term interest is profit, and long-term interest is development. If distributors possess strong channel control, they gain market voice and can even control their own destiny. So, the question arises: In the increasingly competitive food market, how can distributors control channels?

**1. Customer Screening**
Optimize channels. In the early stages of channel expansion, distributors often indiscriminately gather resources regardless of size or quality. After a phase of expansion, distributors should, based on actual development needs, carefully review and optimize their developed customers, considering market layout, channel layout, and distributor resources. Then, based on screened customer resources, conduct comprehensive evaluations around product structure, sales targets, and cooperation potential to further control market channels and outlets, providing effective basis for market adjustments and decisions, and reducing cooperation risks by timely understanding customer dynamics.

**2. Relationship Cultivation**
Channel communication and loyalty cultivation are crucial in daily maintenance. The ultimate goal of communication is to establish good cooperative relationships, enhance trust, and improve distributors' loyalty to brand cooperation. An effective way to improve communication is to form fixed workflows and use tools like forms and communication systems to ensure supervision is implemented. Address customers' urgent needs promptly and resolve feedback to boost cooperation confidence. When visiting downstream distributors, it's not just a formality; it's about collaborating with customers' sales, going to the market, listening to frontline customers' true voices, and establishing a rapid response mechanism for issues and information to improve supervision efficiency.

**3. Personnel Training**
Simply put, distributors nominate outstanding staff, and distributors provide free training. The purpose is to ensure clear understanding of product characteristics, how to sell goods faster, and improve turnover. In essence, it's about helping customers do business based on product features and channel resources, smoothly transferring goods from warehouse to market and driving sales. Training formats can include inviting practical experts or leveraging manufacturer training resources, focusing on product selling points, promotions, and marketing, to fully train distributors and channel partners. Training not only improves sales staff's professional quality but also helps them earn more money.

**4. Off-Season Maintenance**
Some believe off-season is for maintenance, peak season for sales. In reality, market maintenance and customer relationship management run throughout the entire year, even during off-season, preparing for peak season sales. During maintenance, you can even implement downstream customer decomposition plans ahead of competitors. Distributors can leverage manufacturer-assigned co-sales teams to proactively engage in community marketing during off-season, grabbing orders before peers.

**5. Model Reference**
With diversified competition and demand, today's distributors and sub-distributors are not necessarily in a permanent hierarchical relationship. They can upgrade cooperation models based on mutual resource advantages. This is reflected in channel model innovation, where distributors and sub-distributors can establish interest communities, such as joint sales bodies or cooperation funds, to integrate terminal and secondary wholesale resources, achieving shared success and collaborative development.

**6. Promotion Planning**
Distributors can organize irregular promotional activities to attract retailers' enthusiasm and enhance brand influence. If it's a leading brand, consider company development plans and run promotions for key items. If it's a follower brand, consider competitors' investments for targeted counterattacks. However, distributors must ensure promotional activities align with annual market support budgets and effectively supervise and provide feedback on promotions to monitor channel dynamics.

**7. Inventory Management**
Good inventory management directly affects distribution efficiency. For distributors directly controlling terminals, stockouts not only miss sales opportunities but also harm terminal relationships. Distributors should monitor their own inventory changes for timely management and also monitor terminal store inventory to replenish promptly, seizing more sales opportunities and winning terminal trust.

Generally, distributors who accomplish these seven tasks can truly become strong and control their own destiny. Therefore, to further strengthen market control and voice, and to grow bigger and stronger, distributors must possess strong channel control.

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