---
title: "Small dealers rely on luck, medium dealers on management, large dealers on direction"
description: "Hello friends. I'm Yuan Lai from New Distribution. Small dealers rely on luck and courage; medium dealers rely on management and professionalism; large dealers rely on direction and choice. These are some insights I've recently summarized based on the scale of dealers' business volume."
author: "袁来"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2025-07-27"
categories: "Management & Methods"
language: "en"
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markdown: "https://xinjignxiao.com/en/articles/small-dealers-rely-on-luck-medium-dealers-on-management-large-dealers-on-4909cb8c.md"
original_source: "https://mp.weixin.qq.com/s/l7Ov1yWuoDfBNnt77YjLZA"
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citation: "袁来. “Small dealers rely on luck, medium dealers on management, large dealers on direction.” New Distribution, 2025-07-27. https://xinjignxiao.com/en/articles/small-dealers-rely-on-luck-medium-dealers-on-management-large-dealers-on-4909cb8c/"
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---

# Small dealers rely on luck, medium dealers on management, large dealers on direction

> Hello friends. I'm Yuan Lai from New Distribution. Small dealers rely on luck and courage; medium dealers rely on management and professionalism; large dealers rely on direction and choice. These are some insights I've recently summarized based on the scale of dealers' business volume.

Hello friends.
I'm Yuan Lai from New Distribution.
Small dealers rely on luck, medium dealers on management, large dealers on direction. These are some insights and thoughts I've recently summarized based on the dimension of dealers' business scale.
**Small dealers rely on luck and courage.** You bet on the right brand, follow that brand, build a basic channel network through it, and then continuously add more products to that terminal network.
**Medium dealers rely on management and professionalism.** When you have agency rights for three to five leading brands and reach a certain scale, you start building a team. At this point, the importance of management is self-evident. Management is not just about managing people, but about ensuring frontline salespeople truly execute professional sales actions (display, promotion, negotiation, etc.).
**Large dealers rely on direction and choice.** When you reach a certain business scale, brand manufacturers start approaching you because you have more comprehensive channel coverage, stronger capital, and a more complete team.
At this stage, the test is the owner's understanding of the business: where should the business direction go? There are four paths—which one to take? Perhaps every path is correct, but the fear is that you go halfway and realize it's wrong, then have to switch.
This article discusses the core operational obstacles at different business scale stages, hoping to inspire and provoke thought among dealer owners.
Before we start, let me explain that due to differences in product categories, channel coverage, and cities, there is no strict standard for business characteristics corresponding to business scale. The reference point is mainly third- and fourth-tier cities.
Based on business scale, I divide the business into three stages:
> **Stage A: 10-20 million yuan business**
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> **
> **
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> **Stage B: 20-40 million yuan business**
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> **Stage C: 40-80 million yuan business**
Let's analyze the specific core obstacles at each stage.
**Stage A: 10-20 million yuan business**
Dealers at Stage A, reaching 10-20 million in business volume, have achieved TOP5 positions in certain channels by distributing one or two leading brands.
It is precisely by doing well with one or two leading brands (for daily chemical sub-categories, multiple brand combinations are needed) that they achieve the leap to 20 million and gradually begin diversified brand agency.
Similarly, **the core difficulty for Stage A dealers is obvious: the key reason for not reaching 20 million is the failure to select or cultivate core strategic brands to build a basic local channel network.**
In a third- or fourth-tier city (not a county-level market), if business hasn't reached 10-20 million, it's likely there's no brand with over 5 million in sales. Without that, their local channel coverage is superficial, with only one to two hundred outlets. The owner's mindset is: "This is about it; it's enough to get by."
**Stage B: 20-40 million yuan business**
Dealers at Stage B, reaching 30-40 million in business volume, have started diversified brand agency. In one or two sub-categories, or under large-capacity categories, they have achieved a certain market dominance through a combination of several brands, gradually forming a partial category advantage.
At 30-40 million, dealers begin to have more shelf resources at the store level.
For Stage B dealers, the core obstacles to not reaching 40 million are:
> **Either a lack of capital, making it impossible to bear store credit periods and fund the selection of more brands.**
>
>
>
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> **Or facing management issues, especially the process, standardization, and institutionalization of internal organizational management. If we talk about specific manifestations, it's about personnel management.**
At 10-20 million, with five to seven people, the boss can shout and information is transmitted with zero loss. The boss is also on the frontline, knowing the market situation; essentially, it's still a sole proprietorship. Employees' actions and results are rewarded accordingly.
But at 30-40 million, with over ten people, the internal organization begins to have layers, departmental divisions, and supervisors or managers. Information transmission inevitably suffers loss and attenuation. With the prototype of a small company, you can't rely solely on individuals; you need management, especially in accounts and expense management with stores and manufacturers.
For example, when a manufacturer invests in a system supermarket for a promotional event, including special prices, ground promotion, gifts, and temporary sales staff, the dealer often has to advance the costs. Just calculating the price difference compensation is a headache.
For a promotional event, regardless of sales volume, you can't tell if it's a loss or profit; even if it's a loss, you can't calculate how much. A responsible manufacturer supervisor will reconcile accounts with you, but an irresponsible one won't even bother. Moreover, even if reconciled, from the manufacturer's perspective, the profit or loss they calculate may not be the true figure.
**Without a process-oriented, standardized financial management system, it's easy to form a financial "black hole"**—money keeps circulating on the books, but it decreases over time. You might think it's due to increased inventory or longer credit periods, but in reality, you're continuously losing money.
Additionally, in personnel management, never test human nature; use processes and systems to set bottom lines and principles. You can trust the team's combat capability, but you cannot let team management run loose.
Only when people are managed well can work be done meticulously; only then can business grow sustainably.
Regarding salesperson management, dealers often find themselves in an awkward position: they don't know how to use, reward, dare to manage, or dare to punish.
**Stage B requires crossing the "management hurdle,"** but many dealers fail to do so, lingering around 20-30 million.
Conversely, why do most dealers today remain at 20-30 million? Besides upstream manufacturers' regional divisions and controls, over 80% is due to poor internal management and limited management capabilities.
**Stage C: 40-80 million yuan business**
Dealers at Stage C, crossing from 40 to 80 million, have overcome the basic management hurdle.
At this point, dealers can dominate the local market in a large-capacity category or three to four sub-categories, such as sanitary products, oral care, personal care (sub-categories), or snacks, condiments (large-capacity categories).
**For Stage C dealers, the core obstacle to not reaching 80 million is unclear business development planning.**
Reaching 40 million already gives you a certain influence in the local dealer circle. Especially in sub-categories, you might even be a leader, with more resources and bargaining power.
With more resources and influence, you often have more choices. But having more choices isn't always good, because you might look around, trying this and that.
Without systematic category planning, a friend introduces a brand that seems good, so you try it; the next day, a manufacturer manager comes with high margins and strong support, so you want to give it a shot.
Unable to focus and concentrate, without a clear business direction, you stay stuck at 50-60 million, unable to move forward.
These are my thoughts on the typical characteristics and key obstacles of dealers at the three stages. Dealer owners can consider which stage they are in.
Of course, I haven't proposed specific solutions here, but I believe that in many cases, **defining the problem clearly is often more important than the solution itself.**
In trading businesses, methods and measures are limited: learn what you don't know, and if you still don't understand, spend money to hire someone to solve it. The worst is not knowing where the problem lies.
**In Conclusion**
Over the past decade or more, dealers have grown continuously due to demographic dividends, store expansion dividends, and product demand dividends. With people, vehicles, and products, you could make money.
But now, with the diversification and fragmentation of retail formats, competition is increasing, and the value dealers deliver locally is being diluted or even replaced.
Low-price impacts, manufacturer direct control, and business diversion are becoming more common. With retail channel differentiation and competition for existing demand, the dealer business has entered an era of thin profits. In daily operations, if you're not careful, you won't make money and might even be doing fake business.
Can the business still be done? Where should it go?
Many dealer owners report: confusion!
We believe that given the current environment, in 2025 and beyond, the focus for dealers should be: **Survive, outcompete peers; go out, expand your survival radius.**
When facing business confusion, looking inward often won't find answers; instead, it may lead to more involution. Looking outward, observing the thoughts and practices of excellent large dealers, might bring you different inspiration and thinking.
From August 19-21, 2025, the "2025 7th China FMCG Conference" with the theme "New Demand, New Supply," along with the 5th China FMCG Retail Innovation Conference and the 5th China FMCG Dealer Conference, will be held grandly in Shanghai.
"New Distribution" surveyed nearly 500 dealers and will release the "2025 China FMCG Dealer Business Status Survey Report" at the conference, to see which dealers are growing and which are being eliminated this year. Where is the operational focus? Where are the business opportunities?
At the conference, we've also invited benchmark cases of dealers transforming in different directions: Zhong Xiaoping, GM of regional B2b platform Jiecang Wugou; Zhang Shicheng, GM of Tianjin Shicheng Bofa, representing retail channel operators; Zhang Gaifeng, GM of regional category operator Zhengzhou Dapeng Trading; and Li Fen, GM of Xuzhou Runzhong Supply Chain, among others, to share their practical experiences and thoughts on transformation.
Growth is not achieved through involution but through accurate, steady, and swift action after understanding—all the knowledge we have will be shared on-site!
🔺


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## Citation metadata

- Publisher: New Distribution
- Author: 袁来
- Published: 2025-07-27
- Canonical: https://xinjignxiao.com/en/articles/small-dealers-rely-on-luck-medium-dealers-on-management-large-dealers-on-4909cb8c/
- Original source: https://mp.weixin.qq.com/s/l7Ov1yWuoDfBNnt77YjLZA

## Copyright and AI use

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Contact: zhaobo258@gmail.com · +86 158 5481 7671