--- title: "Starting Next Year, Distributors Will Accelerate Their Exodus from Supermarkets and Hypermarkets!" description: "In recent years, distributors have struggled due to the difficulties faced by offline supermarkets. The industry has seen severe polarization, with good stores like Pangdonglai forming monopolies and bad ones going bankrupt. However, the core problem lies with the supermarkets themselves: if they don't court disaster, they won't die. The overly saturated FMCG market is undergoing natural selection, and polarization is a normal economic evolution." author: "New Distribution" publisher: "New Distribution" email: "zhaobo258@gmail.com" telephone: "+8615854817671" published: "2017-01-24" language: "en" canonical: "https://xinjignxiao.com/en/articles/starting-next-year-distributors-will-accelerate-their-exodus-from-superm-e4aa7ba1/" markdown: "https://xinjignxiao.com/en/articles/starting-next-year-distributors-will-accelerate-their-exodus-from-superm-e4aa7ba1.md" original_source: "https://mp.weixin.qq.com/s/9Sc80PqAe61H7hUuZIRoKg" translation: "https://xinjignxiao.com/zh/articles/%E6%98%8E%E5%B9%B4%E5%BC%80%E5%A7%8B-%E7%BB%8F%E9%94%80%E5%95%86%E5%8A%A0%E9%80%9F%E9%80%83%E7%A6%BB%E5%95%86%E8%B6%85%E5%A4%A7%E5%8D%96%E5%9C%BA-e4aa7ba1.md" attribution: "New Distribution — https://xinjignxiao.com/en/articles/starting-next-year-distributors-will-accelerate-their-exodus-from-superm-e4aa7ba1/" usage_policy: "https://xinjignxiao.com/ai-policy.txt" --- # Starting Next Year, Distributors Will Accelerate Their Exodus from Supermarkets and Hypermarkets! > In recent years, distributors have struggled due to the difficulties faced by offline supermarkets. The industry has seen severe polarization, with good stores like Pangdonglai forming monopolies and bad ones going bankrupt. However, the core problem lies with the supermarkets themselves: if they don't court disaster, they won't die. The overly saturated FMCG market is undergoing natural selection, and polarization is a normal economic evolution. In recent years, distributors have had a tough time, partly due to the struggles of offline supermarkets. The supermarket sector has seen severe polarization: good stores are gradually forming monopolies, such as Pangdonglai Supermarket, while bad ones are closing or going bankrupt on a large scale. Overall, business is getting harder. However, the core issue lies with the supermarkets themselves—if they don't court disaster, they won't die. **1. The Overly Saturated FMCG Market Is Experiencing Clear Survival of the Fittest; Polarization Is Normal Economic Evolution!** In the early days of economic boom, we didn't realize that the FMCG industry was already severely saturated. After the state curbed extravagant spending and reduced waste, the bubble of consumption receded, revealing the harsh reality. In recent years, only supermarkets with genuine operational capabilities have been able to fight harder and do better. Those traditional stores, mom-and-pop shops, and family-run stores that relied on having some money to open a shop, with rough management, no purchasing advantages, no display skills, and mediocre atmosphere, have gradually seen their business decline. More and more supermarket owners are going bankrupt, closing down, or fleeing. **2. Supermarkets Struggling for Survival Are Digging Their Own Graves by Shifting Risks to Distributors!** Once a supermarket's business declines, management often fails to reflect on their own lack of marketing capability. Instead, they shift more risks onto distributors, which is a recipe for rapid self-destruction. There are various fees: barcode fees, entry fees, contract renewal fees, rebates, new store opening fees, and so on. Chinese supermarkets do not profit from selling products but try every means to collect various fees to sustain themselves. This is extremely unhealthy. Some supermarkets, to earn more fees, lock the codes of best-selling products from distributors, forcing them to pay to unlock, and then charge entry fees again. After two years of declining sales and profits, supermarkets are not actively thinking of ways to collaborate with distributors to boost sales through promotions. Instead, they resort to underhanded tactics, forcing distributors to sign sales and profit targets, and if they fail, they demand distributors make up the profit difference. They try every possible way to make money from upstream, losing sight of the core of supermarket profitability. With excessively long payment terms and huge fees, distributors not only fail to make money but gradually find themselves losing more and more! This unhealthy retail environment in China has inadvertently contributed to the miracle of e-commerce. It is these unequal sales terms that have led to the rapid rise of convenience stores and other private supermarkets. We complain that business is hard, curse e-commerce, and blame Jack Ma for stealing business from physical stores. But ask: How far can a supermarket go without new products, market vitality, or support from numerous suppliers? How long can a business that disregards the survival of its partners last? Why should it be competitive? Why should it get good products, high margins, or more promotional support? **3. Successful Hypermarkets Are Increasingly Sourcing Directly from Manufacturers, Squeezing Distributors' Profits.** In Luoyang, Henan, Da Zhang is highly competitive locally. It sources directly from the manufacturer Miduoqi for its chip products, making it difficult for other chip distributors to enter. Even if they get in, their display and other aspects are not as advantageous as direct sourcing, forcing distributors to flee hypermarkets. Some manufacturers offer better policies to hypermarkets than to distributors, so many distributors have to buy from supermarkets. If their own prices are not lower than those of hypermarkets, how can they sell to them? Bad supermarkets have poor business and squeeze distributors. Good supermarkets are even more powerful than distributors. As food distributors, it's getting increasingly difficult. More and more manufacturers and distributors are fleeing supermarkets, focusing on the circulation market. Starting next year, distributors will face even more hardship, and competition will be even more intense. Regardless, we always hold to an old saying: **The market is the ultimate test of truth. Those who follow the trend prosper; those who go against it perish. Building good relationships with distributors ensures stable products and stable business in supermarkets. Following the natural way brings support from many. When all distributors flee supermarkets, physical stores will face even greater difficulties in the future! The distorted business ecosystem is facing a major reshuffle!** **Share this for the struggling distributors!** -END- --- ## Copyright and AI use This article is sourced from New Distribution. Search, quotation, summarization, and model training are permitted, but every use must credit New Distribution and retain the canonical source URL. 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