Click the image for details. A healthy market growth, besides team building and network channel development, relies on terminal development and management. The 12-character mantra of Chinese-style terminal sales management—"Vertical penetration, intensive cultivation, decisive terminal"—still echoes in our minds. Terminal development is crucial; it is the end where products form sales and the port where products reach consumers, such as supermarkets, convenience stores, internet cafes, restaurants, liquor stores, and JD.com. Consumers buy their beloved products through this port. The terminal is a highly competitive and decisive battleground where various brands clash. How to grasp the terminal rhythm, attract consumers' attention, and influence their purchasing psychology is key to terminal work. Like a tree, only with developed roots can it flourish. Honestly, Wahaha's practices in this area were not great before, but after multiple explorations following market changes, Wahaha developed its own unique management methods, different from other manufacturers, yet highly effective. Terminal Price Differential Management Wahaha's management of terminal price differentials is based on mutual benefit, trust, and win-win, implementing a guiding price. To ensure price system stability, Wahaha implements a tiered price differential management system, clearly defining the ex-factory price and retail price for each product at first-level wholesalers, special second-level wholesalers, second-level wholesalers, third-level wholesalers, and supermarkets. All levels must strictly implement price differentials: the per-unit profit for first-level wholesalers should be less than that for second-level wholesalers, and the per-unit profit for second-level wholesalers should be less than that for third-level wholesalers. For example, in 2009 when Luoyang innovatively developed a second network, for wholesalers who could order by the truckload, Wahaha stipulated that first-level wholesalers add 0.5 yuan per piece and deliver directly to the wholesaler's warehouse; wholesalers then add 2 yuan per piece and deliver to terminal retail stores, which uniformly sell to consumers at the retail guide price of 2.5 yuan per bottle. That is, first-level wholesalers rely on volume and company sales incentives for profit, while the wholesalers closest to the end are key to terminal management, but their volume is small, so their price differential is relatively higher. Thus, those with large volume increase profit through volume, and those with small volume mainly rely on slightly higher differentials. Meanwhile, retail prices at various outlets must be unified, ensuring the enthusiasm of terminal retail stores and the stability of terminal sales prices. How to Suppress Channel Crossing To protect dealers' interests and maintain regional price stability, Wahaha requires all links to strictly implement company regulations. The most effective method is to crack down on cross-regional sales. To quickly investigate and deal with channel crossing, Wahaha has implemented the following rigorous measures: 1. Set Up an Anti-Channel-Crossing Inspection Department The group company has an inspection department dedicated to verifying channel crossing and other behaviors detrimental to market sales. Provinces also have internal inspectors who can quickly verify and handle cross-regional sales. For example, the Yubei Market Inspection Team was established early and once became a model for Wahaha. 2. Product Identity Information Management Every product produced by Wahaha is marked with production date, time period, shift, and serial number at the time of production. According to planned orders, when shipping to various regions and customers, each product's packaging is marked with the corresponding customer's code. At the factory, staff input product identity information into the Wahaha sales management system, just like an ID card—enter the system and you know who it is. Additionally, when first-level wholesalers deliver to second-level wholesalers or wholesalers in their area, they must print hidden codes and marks on relevant product positions as per company requirements, both to protect themselves and to prevent second-level wholesalers from cross-regional sales. 3. Accept Reports and Quickly Verify Whether business personnel, first-level wholesalers, or second-level wholesalers, if they find suspicious goods in their area, they only need to fill out a report form with the product packaging code or production date and report it to the head office inspection or provincial chief inspector. The inspector will lock onto the source based on the product system information, quickly go to the suspected source for evidence verification, and simultaneously notify the relevant business supervisor to confirm. The basic process is: discovery → report → verification and report → handling. Display Management Techniques The battle for terminals is the inevitable gateway for products to reach consumers, and display activity management is a must-use tactic for all. However, terminal vivid display management is not just for looks, nor just for selling goods, nor for display's sake. There's a saying: "80% of advertising costs are wasted, but you don't know where." All merchants believe that "terminal momentum comes from effective attraction or interception of customer flow," so many conventional practices—such as displays, end caps, special prices, buy-one-get-one, lotteries, points, free tasting, sample distribution, bundle sales, POP ads, DM ads, stack drapes, product manuals, salesperson recommendations, limited-time flash sales, clown performances, joint promotions...—have reached the point of exhaustion. The problem of "terminal promotions being hard to promote" is increasingly prominent. Behind the bustle and busyness, there is always suspicion of "excess" and "waste." Many promotions are lively, but actual results are often not optimistic; often more input, less output, or even only input without output. So, how can terminal promotions still be done? How to break through the terminal trap? 1. Time Effect Innovation Since 2005, Wahaha's Yubei market has specifically studied terminal display activities through application, trial, and error. First, displays must be standardized, with before-and-after comparisons each time. Second, focus on input-output ratio, such as spending the same amount of money with different implementation methods, then compare data changes to maximize input-output efficiency. Take the example of display duration: the Yubei market studied it as the "staggered time effect." You may not have heard of it; see how it differs from your approach and how much more benefit Wahaha can gain. Look at the example below: Whose plan would you choose? The best plan is Xiao Wang's. He grasped several key points of display activity duration:

  1. Mid-Autumn Festival and National Day;
  2. Maintain a minimum of 30 boxes daily; if insufficient, replenish immediately because the activity requires 50 boxes for centralized display.
  3. The start and end times include National Day, and the final check time is 2 days before the end. If 30 boxes can still be displayed on the storefront 2 days before the activity ends, what does that mean?
  4. He captured the psychology of businesspeople. Who wouldn't want to sell more and earn more during festivals? Even without display fees, store owners would put goods on the street, and at least 10 to 15 days, the owner is displaying for Xiao Wang for free. Xiao Zhang's plan didn't utilize businesspeople's festival habits; during holidays, even without display fees, terminal owners will proactively display goods. Also, Xiao Zhang's supervision interval, especially the final one, was half a month apart—too long. Xiao Ma's plan started a bit early, and the main issue was that the supervision and follow-up intervals were too long at the beginning, and the final follow-up ended too early. Unreasonable time allocation in display activities causes sales losses and resource waste. After data comparison, the research team found that Xiao Wang's plan could increase Wahaha's efficiency by 16%. After 5 years of data tracking by the Yubei Inspection and Training Teams, it was found that a display activity with irregular and unreasonable time periods causes huge losses. When formulating display activity policies, you must consider terminal store sales profitability and competitor activity policies; otherwise, your activity is a waste of resources. For example, as shown in the right figure, if you don't consider competitors' sales and profits in stores when formulating display policies, and blindly create policies behind closed doors, you lose at least 50% to competitors before the activity even starts. According to our statistics, due to irregular displays, each activity loses 15.58% of sales opportunities and wastes 11.84% of resources. If your company invests 10 million yuan annually in product display activities, ignoring other factors, based on research results, halving your company's sales loss is equivalent to losing a county with an annual task of 7 million yuan. 2. Innovating Display Traditions Why don't consumers act? The answer is product homogeneity. Why don't display activities yield results? The answer is exhaustion and rigid models. To break through tradition, you must pay the price, continuously innovate, trial and error, revolutionize traditional methods, and find a way to maximize benefits. After years of research, the Yubei Market Training Team summarized a set of display methods that maximize benefits. Due to the diversity and complexity of terminal structures, any terminal management activity must first conduct market research and current situation analysis, then adjust accordingly to the actual structure, and implement flexibly, not one-size-fits-all. For example, for beverage display types, conventional choices include loose bottles, end caps, shelves, stack boxes, stack boxes plus loose bottles, and buyouts. So which terminals are suitable for loose bottle displays, which for end cap displays, which for stack box displays, and which for buyout displays? How to maximize input-output efficiency? Yubei chose as follows: If terminal points are concentrated in kiosks, ice cream stalls, etc., loose bottle displays are best; If terminal points are concentrated in small supermarkets, community convenience stores, etc., end cap displays are suitable; If terminal points are concentrated in wholesale stores, grocery wholesale-retail stores, etc., stack box displays are suitable; For stores with high foot traffic like bus station entrances, park entrances, etc., loose bottles and end caps are suitable; For special channels like cinemas, KTVs, internet cafes, high-end business clubs, gyms, etc., buyout displays are suitable. Once, the Yubei Training Team was training grassroots salespeople in Jiaozuo market. When the teacher mentioned that an end cap display activity in a certain area was effective, a salesperson stood up and said he had also done an end cap display activity last month but it wasn't effective. When the teacher mentioned that sales work must follow company regulations, another salesperson stood up and said his supervisor said loose bottle display activities in a certain area were very effective and arranged for them to do loose bottle displays last month; he followed the requirements but it wasn't effective, and the supervisor scolded him, looking wronged. After the training, we decided to visit the market to see what was wrong. After visiting both areas, we found that the first salesperson's problem was that his area's terminal structure was mostly wholesale departments, which are not suitable for end cap displays. The second salesperson also had terminal structure issues in his area. Additionally, we found that he strictly followed the company's loose bottle display requirements (Wahaha's activity product loose bottle display specification is 8 facings), while the competitor's loose bottle display was 10 facings, so he lost to the competitor in momentum. These two real cases reflect that, on one hand, salespeople don't analyze their terminal structure to see if the policy is suitable. On the other hand, salespeople lack flexibility; for example, our loose bottle display regulation is 8 facings, but when competitors reach 10 facings, shouldn't we analyze the specific situation? 3. Mobile Ice Stall Management Every summer, many mobile ice stalls appear, some in parks, some in squares, some on streets, some near stations, some only at night. They are highly mobile, making display management difficult. What would you do for such special terminals? Wahaha adopts a surprise visit policy, which we call "manna from heaven." Take Wahaha black tea's prize display as an example: execution time is 1 day, random visits with on-the-spot rewards. For every bottle of Wahaha black tea frozen and displayed in the freezer, an equal number of green tea bottles are rewarded. After preparations, Wahaha sends salespeople in several groups following customer vehicles, pulling green tea to visit mobile ice stalls that day. As soon as they open the freezer and see how many bottles of frozen Wahaha black tea are inside, they immediately reward the same number of Wahaha green tea bottles. Many mobile ice stall owners suddenly receive such free gifts from Wahaha, feeling like manna from heaven, grinning from ear to ear. Owners with fewer bottles or those who didn't receive gifts, upon hearing about Wahaha's activity, will proactively stuff Wahaha products into their freezers because they don't know what Wahaha's next policy will be or when they might visit again. But Wahaha people know exactly what they're doing; based on competitor atmosphere and their own market needs, the activity policy won't be stingy—it might be 3-5 days or 7-8 days, usually with 2-3 consecutive surprise visits covering the entire summer ice stall season. Facing the complex problem of terminal homogeneity, as long as enterprises use cases as references, adapt to their own actual situations, innovate management according to local conditions, and revolutionize old ideas, they can definitely break through the terminal blind spots! Author: Luo Hongwen, Founder of Shenzhen Fast Lane Management Consulting Co., Ltd. -END-