---
title: "Manufacturers' Dissatisfaction with Distributors: Distributors Are Actually Scapegoats"
description: "Distributors often bear the brunt of manufacturers' dissatisfaction, but many of these issues are actually caused by the distributors' employees, not the distributors themselves. By implementing proper performance assessments for their staff, distributors can resolve these problems and improve their relationship with manufacturers."
author: "魏庆老师"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2019-07-12"
language: "en"
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# Manufacturers' Dissatisfaction with Distributors: Distributors Are Actually Scapegoats

> Distributors often bear the brunt of manufacturers' dissatisfaction, but many of these issues are actually caused by the distributors' employees, not the distributors themselves. By implementing proper performance assessments for their staff, distributors can resolve these problems and improve their relationship with manufacturers.

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**Distributors: Caught in the Middle, Suffering for Others**
There's an online joke: The cook in an artillery battalion has the worst lot—wearing a green hat (cuckold), carrying the blame, and watching others have fun.
Distributors are caught in the middle—brands are controlled by manufacturers; if the manufacturer frowns and says 'you're out,' the distributor loses their agency. Consumers are at the mercy of the retail terminals; if the terminal turns its back, your products are out, and sales vanish.
With strong brands, manufacturers can browbeat distributors with pressure, but distributors rarely dare to pass that pressure on to terminals; they end up smiling at both sides.
The most unjust part is that **many of the manufacturers' dissatisfactions with distributors are actually cases where distributors are scapegoats!**
**What are the 'most unsatisfactory' issues manufacturers have with distributors?**
## Think about it: What are the 'thorniest' problems manufacturers face in managing distributors? **In essence, they boil down to four categories.**
## **1. Distributors 'not investing enough capital'**
## Distributors not paying for goods on time...
## **2. Distributors 'not developing outlets well'**
Distributors 'lack people and vehicles,' unwilling to go out for marketing, leading to delayed outlet development and low distribution rates.
**3. Distributors 'not providing adequate terminal services'**
Distributors' employees only focus on selling everywhere without providing terminal services.
They skip visits (visiting big stores but not small ones, familiar old stores but not new ones), push old products instead of new ones...
They don't maintain attractive displays, manage abnormal pricing, or execute promotional activities (e.g., posting buy-one-get-one posters, bundling gifts)...
They don't handle customer complaints promptly (e.g., terminals complain about not exchanging old-dated stock, neighboring terminals undercutting prices without intervention, or delayed deliveries)...
This leads to many 'dead points' at terminals (outlets that are inactive or stop ordering).
**4. Distributors 'lacking market awareness'**
Distributors are unwilling to invest in the market, refuse to sell on credit to terminals, or use rolling settlements for distribution, and they may pocket promotional items meant for terminals...
They don't cooperate with manufacturers in launching new products, developing new channels, attacking new areas, or market expansion plans.
**Distributor Bosses Are 'Scapegoats'**
In fact, these complaints manufacturers have about distributors are not the distributors' fault; they are suffering for others.
**1. Distributors have capital problems?**
**Analysis:**
Distributors are under immense financial pressure: manufacturers demand cash before delivery, while terminals demand goods before payment. Distributors' inventory and receivables keep growing, and they have to advance funds for promotions, which is a hassle to reimburse...
Actually, it's not that distributor bosses lack money; there are too many management loopholes, and funds are tied up in various places. The larger the distributor, the greater the financial pressure.
A significant portion of a distributor's capital is tied up in terminal outlets. So, **the distributor's capital isn't liquidated largely because their outlets' capital isn't liquidated.**
Why isn't the outlets' capital liquidated? The industry has mature practices for receivables management and assessment accumulated over decades.
Do distributors have process management for 'customer credit limits and credit periods' for their employees? Do they conduct daily tracking, weekly summaries, and monthly assessments for 'overdue or over-limit' receivables?
If distributors implement detailed 'receivables management and assessment systems' for their employees, the capital at terminal outlets will be freed up, easing the distributor's financial pressure, and thus alleviating the conflict over 'late payments to manufacturers.'
**So, insufficient distributor capital is largely a problem of the distributor's staff's 'receivables management and assessment.'**
**2. Distributors 'lack people and vehicles,' leading to delayed outlet development and low distribution rates**
**Analysis:**
Who is better at developing terminal outlets—manufacturer salespeople? They are the 'regular army,' perhaps with higher education, more training, better uniforms, salaries, and travel benefits...
But a terminal might not be won over after eight visits by manufacturer personnel, yet a distributor's person can say, 'Sister, this is my product, do me a favor,' and the terminal might order: 'Oh, it's yours? Why didn't you say so earlier?'
Why? Because of good relationships. Manufacturer personnel change often and usually cover large areas (companies like Master Kong that do route visits are rare). How many times do your people visit terminals?
Distributor personnel have been delivering to terminals for ten years, extending credit for ten years, and may even play cards or visit relatives with terminal owners during holidays... This relationship advantage is something manufacturers can't replicate.
If we can assess distributor employees on 'terminal outlet development,' 'number of new product placements,' 'number of outlets ordering new products each month,' and 'number of active ordering customers each month'... If we mobilize these people, new product placement and outlet development will speed up the fastest.
**No distributor boss wants 'delayed outlet development and low distribution rates' in their area. This is also a matter of employee assessment and management.**
**3. Distributors 'not providing adequate terminal services'?**
**Analysis:**
Same logic: No distributor boss wants 'inadequate terminal services leading to dead or lost stores.'
Terminal services are not performed by the boss but by the employees.
If we assess distributor salespeople on 'complete visits without skipping,' then visit rates will increase, and the number of ordering customers will rise.
If we assess distributor employees on 'standard terminal displays,' then display effectiveness improves, and sell-through speeds up.
If we assess distributor employees on 'penalties for delayed handling of terminal complaints,' then service complaints decrease, and active customers increase.
**So, 'inadequate terminal services' is also a problem of assessment and management efficiency of distributor sales staff.**
**4. Distributors not cooperating with manufacturers on new markets, areas, and channels**
**Analysis:**
Business has its own rules; you can't rely on personal feelings. Distributors are just doing business with manufacturers; why should they listen to you and cooperate? Who do you think you are? Unless they make money selling your products, their willingness to cooperate will naturally increase.
How to make distributors money? Through new product sales, changing product mix; new channel development, changing channel mix; expanding weak areas, changing area mix; managing abnormal terminal pricing, curbing cross-region sales and price undercutting, changing price structure.
How can distributors sell new products, and what if they don't move? I covered this systematically in my 2018 Wei Qing video course over 12 episodes (episodes 5 to 16), half of which focused on personnel management and assessment for distributors in the context of new product sales.
**The same applies to new channel development and new area expansion; all these need to be achieved through assessment of distributor personnel.**
In the FMCG industry, products are homogeneous, outlets are numerous, unit prices are low, sales volumes are high, and profit margins are thin... It relies on a people-intensive, labor-intensive coverage strategy.
Today, most FMCG distributors have their own sales teams. The boss doesn't manage selling; the boss manages buying. The distributor's team is the main force for selling, terminal visits, collecting payments, and terminal services.
Manufacturers face many challenges in managing distributors. If they think calmly, all problems require assessing the distributor's salespeople!
**When a manufacturer is dissatisfied with a distributor about something, they should consider: Is this the distributor's problem or their employees' problem?**
Source: Wei Qing Teacher (ID: weiqinglaoshigongsi)


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