--- title: "Several Links Within the Distributor's Operations That Can Increase Profit" description: "This article is reprinted from FMCG Distributor Professional Consulting Management (kxpjxszyzxgl). As modern commercial retail systems continue to expand downward, traditional distributors generally feel the pressure of thin margins, making profit maximization the core of their competition with both the market and manufacturers. The article provides a framework for distributors to think about profit-generating links within their own operations, including product mix, delivery combination, personnel integration, and channel relationships." author: "舒春昭" publisher: "New Distribution" email: "zhaobo258@gmail.com" telephone: "+8615854817671" published: "2015-03-11" language: "en" canonical: "https://xinjignxiao.com/en/articles/several-links-within-the-distributor-s-operations-that-can-increase-prof-b4220eeb/" markdown: "https://xinjignxiao.com/en/articles/several-links-within-the-distributor-s-operations-that-can-increase-prof-b4220eeb.md" original_source: "https://mp.weixin.qq.com/s/fjESb_YXvGWiS2yOkvqAag" translation: "https://xinjignxiao.com/zh/articles/%E7%BB%8F%E9%94%80%E5%95%86%E5%86%85%E9%83%A8%E5%8F%AF%E4%BB%A5%E5%A2%9E%E5%8A%A0%E7%9B%88%E5%88%A9%E7%9A%84%E5%87%A0%E4%B8%AA%E7%8E%AF%E8%8A%82-b4220eeb.md" attribution: "New Distribution — https://xinjignxiao.com/en/articles/several-links-within-the-distributor-s-operations-that-can-increase-prof-b4220eeb/" usage_policy: "https://xinjignxiao.com/ai-policy.txt" --- # Several Links Within the Distributor's Operations That Can Increase Profit > This article is reprinted from FMCG Distributor Professional Consulting Management (kxpjxszyzxgl). As modern commercial retail systems continue to expand downward, traditional distributors generally feel the pressure of thin margins, making profit maximization the core of their competition with both the market and manufacturers. The article provides a framework for distributors to think about profit-generating links within their own operations, including product mix, delivery combination, personnel integration, and channel relationships. This article is reprinted from FMCG Distributor Professional Consulting Management (kxpjxszyzxgl) As modern commercial retail systems continue to expand downward, traditional distributors generally feel the pressure of thin margins, making profit maximization the core of their competition with both the market and manufacturers. Therefore, when we visit stores, we see distributors integrating the products they represent to hold "food festivals," and we see busy distributor teams; at the same time, we often hear about heated arguments between manufacturers and distributors over market expenses. The distributor I mentioned in the first paragraph should be considered forward-thinking, with development potential among many distributors, and can be regarded as a pillar of the future distributor community. However, even such high-quality distributor teams often feel that making money is difficult, which shows that obtaining excess profits through the market is becoming increasingly hard. Difficult as it may be, business must go on. Moreover, not every enterprise can achieve excess profits through strategic transformation, so distributors can also think about profit-generating links based on their current reality. Here, I only provide a thinking framework from several internal links of distributors for distributor friends' reference. 1. Product Mix Link Generally speaking, distributors with annual sales of 30-40 million yuan typically represent more than 5 brands, with hundreds of SKUs. This includes well-known and unknown brands, large and small brands, best-selling and slow-moving products, and volume-driving and profit-generating products. Distributors should combine the brands and products they represent, then match them with different terminal stores for bundled sales or cross-selling, fully integrating different brand resources for overall deployment, achieving a product mix profit model where best-sellers drive profit products and big brands drive small brands. 2. Delivery Combination Link For example, a county-level city distributor has many types of terminals, including supermarkets and circulation, large and small stores, chain and independent stores, cash-settlement and monthly-settlement stores, and urban and township stores. For distributors, the most difficult part with such a variety of terminals is not distribution or entry, but delivery! If the area is small, this problem is smaller; if the area is large, the problem is relatively bigger! Therefore, distributors should focus on solving delivery issues, especially implementing a fixed-area, fixed-time, and fixed-person order-taking and delivery system, thereby achieving delivery combination. Through delivery combination, efficient delivery can be achieved, avoiding situations where a route is not delivered because a truck is not full, or where several trucks deliver to the same route on the same day. 3. Personnel Combination Link Nowadays, many manufacturers assign salespeople to regions, and distributors also build their own sales teams. However, the feedback we hear is that many stores cannot be maintained. When meetings are held to find reasons, everyone agrees that the problem is too few personnel. Is it really a shortage of personnel? In our market visits, we found that personnel are not as scarce as imagined; distributors' own sales teams are not well utilized, meaning each person's role is not well played. Some distributor teams are like a communal pot, managing all products and doing everything; others have members with selfish motives, only caring about their own products. Not to mention manufacturer salespeople, who always think that since they don't take a penny from the distributor, they are not subject to the distributor's control. Additionally, they are "too busy" (or for other reasons) and do not take care of the distributor's other products in the market. Therefore, if distributors can fully integrate their own teams with manufacturer teams, efficiency will definitely improve. 4. Channel Relationship Link What do distributors lack the least? It's channels. Having struggled in a market for so many years, they have formed their own circles, and most relationships with regional second-tier wholesalers and terminal stores are good; otherwise, they couldn't survive. Distributors can leverage their channel advantages to take on new products, broaden the product chain, or use OEM to extend the industry chain. For example, Hushan Beef, originally a distributor, uses its controlled channels to sell private-label products; there are also cases where distributors and supermarkets jointly create OEM products named after the supermarket. 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