---
title: "Price System Collapsed, Even Dogs Despise It!"
description: "In frontline research, distributors and terminal stores complain most about the price system, with top brands unable to find buyers due to price inversion. Why is the price system problem so severe now? White liquor marketing expert Niu Enkun says: policy escalation is poison. Overuse of tiered policies affects the price system. Combined with excessive inventory pressure, it leads to channel dumping, accumulating to a critical point and causing channel collapse. Policy escalation is poison, hitting the nail on the head. Scenario Research Institute Secretary-General Fang Gang says: online communication is fine, but chasing volume online is suicide. Short-term online volume chasing has a greater impact on the price system, even being the last straw for price collapse."
author: "刘春雄"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2025-07-24"
categories: "Brand Marketing, Dealer Operations, Management & Methods"
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---

# Price System Collapsed, Even Dogs Despise It!

> In frontline research, distributors and terminal stores complain most about the price system, with top brands unable to find buyers due to price inversion. Why is the price system problem so severe now? White liquor marketing expert Niu Enkun says: policy escalation is poison. Overuse of tiered policies affects the price system. Combined with excessive inventory pressure, it leads to channel dumping, accumulating to a critical point and causing channel collapse. Policy escalation is poison, hitting the nail on the head. Scenario Research Institute Secretary-General Fang Gang says: online communication is fine, but chasing volume online is suicide. Short-term online volume chasing has a greater impact on the price system, even being the last straw for price collapse.

In frontline research, distributors and terminal stores complain most about the price system, with top brands unable to find buyers due to price inversion. Why is the price system problem so severe now?
White liquor marketing expert Niu Enkun says: policy escalation is poison. Overuse of tiered policies affects the price system. Combined with excessive inventory pressure, it leads to channel dumping, accumulating to a critical point and causing channel collapse. Policy escalation is poison, hitting the nail on the head.
Scenario Research Institute Secretary-General Fang Gang says: online communication is fine, but chasing volume online is suicide. Short-term online volume chasing has a greater impact on the price system, even being the last straw for price collapse.
I recall a recent chat with a sales executive. After years of continuous growth, this company faced major problems this year, but the sales executive still wanted to maintain growth (not wanting sales to decline on his watch). I knew that maintaining growth was not only difficult but also had significant side effects. So I told him: channel health is more important than sales growth.
This sales executive's mindset is common. When internal and external conditions for growth are lacking, top management tries every means to maintain growth, using dangerous but short-term "emergency" measures. The biggest side effect is price system collapse.
These measures were previously used by frontline staff, such as meeting monthly KPI assessments. Now top management uses them, for example, to make annual reports look better, or in an environment where sales directors are changed frequently, top management's use has even greater side effects.
In the past, channel price policies, especially tiered policies, were common but never used to the extreme as now. With channel bottlenecks, some companies are turning to e-commerce. Top FMCG brands previously had e-commerce shares around 10%, with a high limit of about 20%.
Now some companies see a surge in online sales, not due to new methods, but because excessive low prices online undermine channel confidence. Offline decline is compensated by online. When online share is around 10%, the impact on offline price system is limited. But a surge in online share has a different impact on channel price system. One distributor said: I buy at 6 yuan, e-commerce sells at 3.7 yuan, impossible to continue.
What is the essence of channels? From the user's perspective, it's convenience; from the manufacturer's perspective, first, channels are profit redistribution in the supply chain; if profit distribution is unreasonable, the supply chain ceases to exist. Second, channels are a management system. Channels are public resources; whoever organizes the channels, the channels serve them.
Price system collapsed, even dogs despise it! Regardless of brand.
Emergency measures use strong medicine, but strong medicine is toxic.
Why do FMCG companies take such risky actions despite the risk of price collapse? The reason is the current sales situation, unprecedented in history, and psychologically unprepared.
Saving sales at all costs. This is the obsession of too many top executives!
This obsession was cultivated over decades of growth era, and it's a deadly obsession!
Little do they know that compared to sales and profits, price system issues have a greater impact on channels and the company.
Even if top brands' sales shrink, as long as market share remains, industry position remains. So slight sales decline doesn't affect major manufacturers' industry status.
Profit issues: even if not profitable, they can tough it out. Distributors have their own brand portfolio profit models; only small distributors calculate profit on a single brand, while large distributors calculate portfolio profit.
The recent signs of large-scale channel collapse are primarily due to policy escalation. Tiered policies are too large, and channel problems have accumulated to a critical point. Adding more will cause collapse.
When offline collapses, they reluctantly increase online. Without the ability to launch new products online, the more online sales, the faster the price system collapses.
The combination of policy escalation and online volume chasing accelerates channel collapse.
In the current environment, let go of the growth obsession and pull back appropriately. Return to the origin and rethink the logic of growth.
Since the second half of last year, many white liquor companies have abandoned maintaining sales volume and excessive price policies, and this year channels have become healthier. In a healthy channel environment, foundational work for long-term growth, such as bC integration and new product promotion, can return to a long-term growth track.
Therefore, protecting the price system from collapse becomes the first task for companies to return to health.
Protect the price system! Protect the price system! Protect the price system! Important things said three times.
Policy escalation is chronic poison.
There is no inventory that cannot be pushed, only policies that cannot push out goods. For years, policy-driven inventory pressure has been a tried-and-true method for short-term sales spikes, even forming a dependency.
This situation actually began in 2013 when FMCG entered a downward channel. Early on, it was very effective: big brands plus policies occupying warehouse space squeezed competitor sales.
The first backlash of channel price policies was the B2B wave in 2015.
For the same product, when terminals face the choice of buying from distributors or B2B platforms, price is almost the only indicator.
The low prices on B2B platforms, besides short-term subsidies, were also due to low-price dumping. The driving force for dumping is price, and the factor affecting channel prices is sales policies, especially tiered policies. At that time, many companies explicitly prohibited distributors from supplying B2B platforms, but it couldn't be stopped. The reason was the combination of overstocking and tiered policies; dumping was the only way to solve overstocking.
The second backlash of channel policies is hard discount in leisure snacks.
Hard discount means absolute low prices. Before the factory-to-store direct supply chain system was perfected, the low-price sources for leisure snack hard discounts were still dumped goods. Which of the hard discount giants that have now washed ashore or are washing ashore haven't been tainted in the dumping pool?
Price policy escalation is poison, but chronic poison, with a time lag in effect. Now, the toxicity accumulated from price policies has reached a critical point; a slight increase in dosage is fatal.
When price policies exceed the critical point, price inversion occurs. The most severe price inversion is currently in the sub-premium products of the white liquor industry, where ex-factory prices exceed retail prices.
Price inversion damages the channel price system, affects the channel profit distribution system, and consequently impacts channel management.
Since the beginning of deep distribution, dumping has existed. We used to say: a market without dumping is not a good market (dumping often flows from poor markets to good markets), and a distributor with uncontrolled dumping is not a good distributor (distributors with poor management of downstream). When dumping becomes widespread and prices collapse, the supply chain profit system collapses, and channels collapse.
Generally, under tiered policies, distributors are willing to over-order. After all, the larger the order, the greater the policy. But beyond a critical point, a phenomenon appears: due to price collapse and inversion, the more inventory, the greater the loss.
Thus, channels are no longer willing to overstock, especially retailers keeping only minimum inventory, because they don't know the price of the next batch.
Online volume chasing is suicide.
In recent years, I have consistently praised Tsingtao Brewery's e-commerce department. They have maintained the top position in beer e-commerce for a long time, not only without affecting offline prices but also promoting new products and even linking online and offline. This is what a company's e-commerce department should look like.
Tsingtao Brewery has a special department: the Innovation Business Division. The e-commerce department belongs to it. The Innovation Business Division is responsible for developing and promoting new products. Tsingtao's e-commerce department indeed undertakes the responsibility of promoting new and high-end products. The heads of the Innovation Business Division and e-commerce department have been promoted accordingly.
It can only be said that Tsingtao's online department is different. Because most traditional companies' e-commerce departments are either outsourced to third parties or use offline big single products at low prices to chase volume, without considering the channel price system.
Without the ability to promote new and high-end products, they can only invest in traffic and close deals at low prices. What other tricks does e-commerce have?
In the current shrinking environment, when offline is hopeless, using online as an increment becomes the fastest way to maintain volume. Some companies see a surge in online sales.
Note that Fang Gang used "chasing volume," meaning using online sales to compensate for the sharp decline in offline sales, trying to recover offline losses. This situation only occurs when offline "emergency" measures fail, belonging to "online emergency" tactics.
Offline price inversion involves all distributors. They have dumped others and been dumped by others. The price impact after a surge in e-commerce share is even worse, truly becoming the last straw that breaks distributors' confidence.
Of course, manufacturers have no choice. Without online, they can't maintain sales; the more they do online, the faster the channel collapses.
Carefully savoring Fang Gang's words, he disagrees with chasing volume online but affirms online communication. The Venus Brewery that Fang Gang serves uses online communication, online new product promotion, and then offline linkage to achieve nationwide coverage.
Rebuilding the price system.
If the price system collapses, it must be rebuilt. One idea is tactical rebuilding: smooth price sales; another is strategic rebuilding: forming a new increment system.
The core of tactical rebuilding is channel smooth price sales. Tactically, there are three aspects:
First, abandon tiered policies. Tiered policies favor large accounts and were suitable in the growth era. But tiered policies inherently have the gene for dumping.
Second, establish a new expense accounting system. Expenses should no longer be linked to sales volume or packaged to distributors. Expenses should be tied to user operation actions.
Third, stop pushing inventory; order strictly according to customer orders. Terminals will naturally order when out of stock, and distributors will naturally order when out of stock. If sales have problems, increase user operation efforts, not use inventory pressure to squeeze.
Half a year ago, these ideas were pipe dreams. But now, it's a very favorable time, even a strategic opportunity.
Low-price dumping occurs when distributors with excess inventory want to cash out, utilizing all sales incentive policies and expense policies, then selling at a slight loss, creating cross-regional dumping.
Without inventory pressure, without sales and expense policies, where does the low-price space for dumping come from?
Will this operation cause sales decline? Short-term decline is quite possible. But there is a difference between active decline and passive decline. Active decline leads to health; passive decline sinks deeper.
Recently, there's an atmosphere where distributors refuse to accept inventory pressure, regardless of policy strength. So, if you don't actively decline, you'll passively decline. Therefore, I judge that the entire channel system will naturally return to smooth price sales after a few years.
Tactically, although sales may decline, if combined with strategic increment measures, they will quickly recover. Strategically, rebuilding the price system has two handles: one is seizing the strategic opportunity of national big single products, and the other is quickly transitioning to user operations to replace deep distribution.
Strategic opportunity window for national big single products.
Your problem is a problem; others' problems are your opportunity; everyone's problems are a strategic opportunity. This is my judgment of the current environment.
Indeed, now is a strategic window for launching new products. This is a point I've repeatedly emphasized in recent exchanges with executives. Problems unsolvable in the current system may be solvable in another system. Strategic opportunity means entering another marketing system, different from the current over-deep-distribution system.
Don't fear sales decline; channel system health is more important than maintaining volume. First, abandon the obsession with maintaining volume, especially the obsession to maintain volume during your tenure. Under the current system, maintaining volume is impossible; you can maintain it this year, but not next year. If you maintain sales figures this year, you'll pay double next year.
Besides complaining about the macro environment, companies should reflect. What are the direction and methods for marketing to enter a healthy track?
First, it must be understood that with the current product system and current deep distribution methods, generating increments is difficult. This conclusion should be drawn from FMCG companies' practices in recent years. Don't think your company is an exception.
Rebuilding the product system, rebuilding mainstream marketing methods, and even rebuilding the sales team are necessary to escape the current overall predicament.
First, rebuild the product system. Personally, I think the biggest problem for top brands now is the aging of big single products, which cannot drive overall growth. At the same time, now is the best window to create national big single products and use them to drive all products.
Except for the beverage sector, which has seen continuous new product launches and high-end pushes with good performance in recent years, the mainstream big single products of top FMCG brands are still those successfully launched ten years ago. They are old and can't run anymore.
What is a national big single product? Look at information from Pangdonglai. See the figure below.
Pangdonglai's 2024 revenue was 14.6 billion yuan, and in the first half of 2025, it was 11.7 billion yuan, with full-year exceeding 20 billion yuan no problem. A single big product can reach 500 million to 1 billion yuan in scale. If it were a national brand, it would definitely be a national big single product.
Multinational companies entering China, except for a few niche products, basically have national big single products. In the early days of reform and opening, we thought they were high-end, but later when we went to Europe and the US, we found they were mass consumer goods.
What is the difference between national big single products and current top brands' big single products? I think there are three major differences.
First, national big single products are the product of retailer-led supply chains.
In early Chinese KA stores, top brands bought shelf space, displayed many SKUs, and sales were diluted by numerous SKUs, making it hard to create national big single products.
Now, in "Pangdonglai-renovated stores," with wide categories but narrow products, only a few SKUs per brand can enter supermarkets, so sales rely on national big single products, not SKU quantity.
Second, national big single products are the product of a basically finalized FMCG landscape.
Chinese FMCG has been upgrading continuously; a big single product can easily be replaced by new ones during upgrades. But when the upgrade process basically ends, the classification of high, medium, and low-end products will gradually disappear, replaced by mass, niche, and micro-niche.
Mass products are based on middle-class needs and are the greatest common denominator accepted by high, middle, and low-income groups. For example, Coca-Cola: low-income groups can afford it, and high-income groups have no psychological barrier. When a product is accepted by such a broad group, its scale will be larger than any current big single product.
Third, future national big single products will be one level higher than current ones.
Companies can benchmark their national big single products against Pangdonglai's similar products. In terms of quality and price, they will be higher than current big single products. But the cost-performance ratio will definitely be higher than current industry big single products.
From the opportunity window perspective, now is the best time to create national big single products. There is still one more upgrade opportunity, close to finalization. Supermarket renovations force brands to adjust SKU portfolios.
What is the commercial significance of national big single products? They will make all mid-to-low-end products disappear, reshuffle among big brands, and redefine industry patterns. Manufacturers without national big single products may fall behind, and there may never be such an important strategic opportunity again.
From harvesting sales to sowing sales.
After rebuilding the product system, the next step is rebuilding the mainstream marketing model. The mainstream model is not one applicable to a specific company but to FMCG companies as a whole. I preliminarily identify the future new mainstream model as user operations.
Fang Gang says: deep distribution is the harvester of the growth era, and user operations is the seeder of the shrinking era. This hits the nail on the head.
After the growth era ends, whether online or offline squeeze, there is ultimately no sales volume. Continuing to harvest will only cause harvesters to fight each other.
Reviewing Coca-Cola's history, "Easy Hospitality" is an important historical node. From then on, Coca-Cola's consumption scenarios expanded to almost all scenarios; truly, as many scenarios as there are, so many sales.
To cultivate national big single products, we must face the following realities:
First, the method of cultivating users through mass media advertising is no longer effective.
In the internet age, user operations methods must be used, including online and offline user operations.
Second, the best model for user operations is scenario marketing.
National big single products must not be niche or micro-niche; they must have broad dissemination. So, what logic can achieve broad dissemination in the internet age?
Scenarios carry dissemination genes; scenarios are natural traffic. The four historical dissemination models can all be initiated through scenarios.
> 1. Scenario interactive dissemination model. Immersive experiences, super symbols; these scenario interaction models require scenarios as the best background for interaction.
>
> 2. UGC public domain dissemination model. Current viral video dissemination is UGC; we summarize that viral UGC dissemination logic is based on scenario-driven emotional dissemination.
>
> 3. Private domain dissemination model. Word-of-mouth, scenario-based store broadcasts, scenario-based live streams; scenarios are also backgrounds with natural traffic.
>
> 4. Paid traffic dissemination model. Advertising, PGC, PUGC, OGC, etc., based on Douyin and Xiaohongshu paid traffic; scenarios help dissemination spread.
Third, organize teams and invest resources according to user operations logic.
There are constant voices saying "brand departments are useless" and "marketing departments are useless." Indeed, brand and marketing departments operating according to traditional functions are useless.
We strongly advocate establishing scenario departments because scenarios carry dissemination genes. In the situation where traditional corporate paid traffic models cannot achieve the dissemination scale needed to create national big single products, new models to promote national big single products must be found.
In August, in Shanghai, at the [2025 New Demand · New Supply 7th FMCG Conference], a special forum "Igniting Scenario Marketing" was organized. We invited top industry experts, senior brand executives, and innovative practitioners to discuss best practices and future trends in scenario marketing.
At the "Igniting Scenario Marketing" forum, guests included Liu Chunxiong, Professor at Zhengzhou University and Deputy Dean of Scenario Marketing Research Institute; Tian Dongjian, National Deputy Marketing Director of Mingren Soda Water and Director of Central and Western War Zone; Zheng Guangxian, 1919 Board Director Partner and Marketing President; Fang Yan, Deputy General Manager of Sichuan Quanxing Liquor Co., Ltd.; Gong Fanggang, Secretary-General of Scenario Marketing Research Institute and Founder of New Beer Community and Self-media; Pang Geliang, Founder of Super 4P, and many others.
They discussed core topics such as **how scenario marketing helps brands break through, practical paths for scenarios carrying dissemination genes, and how online and offline can achieve linked growth through scenarios**.
The entrance to the next round of growth is not in reports, but in **users' scenarios**.
****🔺


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## Citation metadata

- Publisher: New Distribution
- Author: 刘春雄
- Published: 2025-07-24
- Canonical: https://xinjignxiao.com/en/articles/price-system-collapsed-even-dogs-despise-it-af42211d/
- Original source: https://mp.weixin.qq.com/s/qYp4f0SUDUhtCcg4ZnGZeA

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