An interesting phenomenon is observed: most second- and third-tier products heavily emphasize and rely on channels, yet channel management remains at the simple level of inventory pressure and payment collection. Channel salespeople are most skilled in these two techniques, but after years of experience, most have not fully integrated them, and there is a clear deficiency in how to effectively implement inventory pressure. Here, I combine my years of marketing experience to summarize my practical experience into ten key techniques for inventory pressure, for your reference.

In channel operations and management, inventory pressure is necessary and is the mission of all salespeople. The reasons for applying inventory pressure are simple, as follows:

  • Inventory pressure can fill the distributor's warehouse, leaving no space for competitors' products.
  • Inventory pressure effectively seizes the distributor's financial resources, preventing them from purchasing other products.
  • Effective inventory pressure forces the distributor to fully promote the product, indirectly making them a core distributor for the brand.
  • Inventory pressure can make the distributor psychologically identify with the brand and gradually become loyal to it.

These reasons make inventory pressure the unchanging method for channel operators, mainly because it is simple and extremely effective. In my practical experience in daily chemical companies, I have seen this happen many times, whether it is first-tier brands like P&G and Unilever or second-tier brands like Slek and Difi, all are the same. Today you use a dinner invitation as an inventory pressure method, tomorrow I use a travel method, and the day after he uses a car giveaway... The methods are constantly changing and numerous. In fact, not only in the daily chemical industry, but broadly speaking, which company that operates through channels does not do this?

In addition to the above reasons, there are some principles of inventory pressure that are easily overlooked by manufacturers. The most easily overlooked principle in the specific operation process is comprehensive inventory pressure. For strong brand products, this is understandable, but for second-tier brands, it can easily cause strong backlash from channel distributors. To better solve this problem, I suggest that manufacturers classify and differentiate distributors when formulating channel strategies. For example, divide them into A, B, and C categories. Each category should be distinguished and precisely positioned. For high-quality A-class distributors, inventory pressure is applied without any reason; their resources must be seized. For B-class distributors, the strategy should be closed inventory pressure for some products and open circulation sales for others, without scale restrictions. For C-class distributors, inventory pressure is generally not used because their distribution capacity is limited; forced inventory pressure can easily lead to "channel indigestion," causing channel blockage and affecting brand reputation.

With the above general principles and direction clarified, the application of specific techniques can be flexible and varied, using targeted strategies based on each distributor's psychological characteristics and temperament to achieve the goal of "channel inventory pressure."

1. Product preferential policies: Use the company's existing policies to entice distributors with benefits, thereby achieving inventory pressure. Preferential policies are targeted channel strategies formulated by the factory to effectively control channel distributors. In industry terms, they are the policy support points and rebate points. These two indicators should be the most concerned topics for distributors and are the most primitive driving force for all techniques. They should be the content that the factory pays the most attention to. It should be noted that this policy has three key points. First, find the competitor's policy and avoid direct conflict and collision with competing products; instead, take a differentiated route. Second, the formulation of product policies should have limitations, including time limits and content quantity limits. The purpose of these two limitations is to make distributors feel that the policy is not something they can easily get. Sometimes, things that are too easily obtained are not cherished. Third, the product combination policy should form a package model for distributors to choose from. Generally, the number of packages should not exceed three; more than three can easily cause difficulty in choice, increasing transaction costs. When making budgets, the factory should focus on the middle package because that package often has the highest transaction rate.

2. Product combination strategy: The factory should not offer policies on single products, because single-product policies can easily cause losses if not controlled well. It is suggested that when offering policies, products should be classified into four types based on market sales: combat aircraft products, scale products, profit products, and image products. When selling this product combination, combat aircraft products can be a strong attraction, but if the distributor wants to purchase, they must carry a certain proportion of profit or scale products. As long as the overall is not loss-making, this combination plan can achieve effective inventory pressure while allowing both the factory and the distributor to profit.

3. Use the "fear of regret" psychology to apply inventory pressure: To make distributors have to purchase, there must be clear interest guidance and risk analysis. For example, in the daily chemical industry, with the surge in oil prices, the trend of product price increases is extremely obvious and predictable. Especially when the industry leader P&G announces a comprehensive price increase starting from a certain month, it will inevitably cause an industry-wide price increase wave. In this situation, you can reason with the distributor, analyze the pros and cons, and as long as you can clearly explain this trend and clearly tell the distributor that "this opportunity will not come again," the confidence of channel distributors will be shaken. Because the essential characteristic of channel distributors is a trading behavior of buying low and selling high. This is using the typical "fear of regret" psychological characteristic of distributors. Of course, there are many more reasons for fear of regret, which need to be planned and analyzed by salespeople in actual combat based on local conditions, and then propose targeted tactics that can effectively move distributors.

4. Give extra things that exceed expectations: This is a typical negotiation skill, using the normal psychological reactions of all people to handle things. Inventory pressure or transactions are essentially the same as negotiation; they are both a game between two parties. In negotiation, the most taboo is to show all your cards at the beginning, because this will instantly put you in a position where you have to make concessions in the next round. The same is true in inventory pressure. All distributors know that salespeople come to take money from their pockets, so they are very vigilant and defensive. If the salesperson shows all their cards at the beginning, the result will be that the distributor feels dissatisfied, increasing the difficulty of the transaction. In addition, the distributor is also a consumer, and their psychology is not much different from that of consumers. They all hope to be satisfied during the transaction. What is satisfaction? Satisfaction is getting more than expected without the other party knowing. Therefore, in the process of inventory pressure, in addition to policies, there should be other ways and means as policy supplements, so that distributors can continuously get "benefits" or "advantages," which will reduce the cost of the transaction. For example, when negotiating inventory pressure with a distributor, you can give some market materials, gifts, or personnel market support, etc. The key point is that these contents are unknown and unforeseen to the distributor beforehand. The more so, the stronger the effect.

5. Use the psychology of comparison to apply inventory pressure: Just as the saying goes, "where there are people, there is a world," all industries have competition, and distributors are no exception, and it is especially fierce. The main reason is that the commercial essence of all distributors is a trading model, a typical "sitting merchant" behavior, with the same business model, slightly different only in scale. This business form inevitably leads to fierce competition among them, especially for distributors in the same region facing the same customer group, it has reached a life-and-death stage. Therefore, in the process of inventory pressure, you can use words like "XX store has already purchased goods worth so much, they are probably going to make a big move..." or "XX store just took our C package policy, we gave them XXX..." to stimulate the current distributor. The main purpose is to arouse their inner potential fighting psychology, thereby achieving the goal of taking this batch of goods. It should be noted that this technique requires full control of the heat; a slight mistake can lead to a breakdown in talks, easily causing the distributor to become disgusted and refuse the transaction. Therefore, those who are not skilled should use it with caution.

6. Use sympathy to apply inventory pressure: This strategy is suitable for veteran salespeople. After years of hard work and dedication, veteran salespeople have established a certain emotional foundation with distributors. If the task is large and the distributor still has the ability to take goods, the salesperson can complain to the distributor, stating their pressure and difficulties, in order to win the distributor's sympathy. Even shedding a few tears at a critical moment will add to the tragic atmosphere. In ancient times, Liu Bei of the Three Kingdoms achieved his goals through "crying" at critical moments. This strategy is most suitable for those salespeople who are usually honest and loyal and do not "fool" distributors. It often has miraculous effects and can play a role in inventory pressure at critical moments. However, the disadvantage of this strategy is that it should not be used frequently; it can only be used at critical moments as a last resort.

7. Retreat to advance inventory pressure technique: Negotiation is an art of psychological game, and the essence of the game is the contest of wits and courage between each other. In a sense, negotiation has no strict definition of win or loss; only whether both parties feel satisfied. In the process of inventory pressure, there is also an element of game, and it is a process of constant probing and correction. If you blindly use a strong pressure strategy, it is very easy to cause strong backlash from the other party, because the topic of inventory pressure is too sensitive, so that distributors know the main purpose of salespeople as soon as they see them at the end of the month. Therefore, in the process of inventory pressure, salespeople should appropriately create a relaxed atmosphere, and sometimes even retreat by giving profits to distributors to achieve the purpose of purchasing goods.

8. Skillfully set suspense to "checkmate" the other party: "Checkmate" is a term in chess, which means to preset topics step by step to finally force the distributor into a position where they have to purchase. This tactic is illustrated by a small case I personally experienced.

A salesperson was promoting a very unknown brand of shampoo to a retail store owner in a township. At the beginning of the promotion, the store owner ignored him completely. Surprisingly, the salesperson did not give up and had the following conversation.

"I know you haven't seen this product before. First, I want to say that the quality of this product is completely fine. Look at my hair; it's the result of washing with this shampoo." After saying this, he ran his hand through his hair.

Then the salesperson said, "How much do you think this product could sell for if placed in your store?"

The owner was silent for a moment and then said, "I think it would sell for about 13-15 yuan. (Note: 400ml)"

The salesperson smiled and said, "How much do you think our purchase price is?"

The owner said disdainfully, "I've been in this business for many years. Your product is only about 10 yuan."

The salesperson smiled again and said, "If you sell it at 15 yuan retail, you can make 5 yuan profit per bottle, with a gross margin of about 50%!"

Seeing the owner's surprised expression, he continued, "Boss, if you buy a case from me, I'll give you a purchase price of 8 yuan, so you can make 7 yuan per bottle, which is nearly 100% gross margin." Then he quickly added, "Anyway, you can buy a case first and see how it sells. If it doesn't sell well, with your store's foot traffic and your sales ability, you won't have inventory for long. On the other hand, what if it sells like hotcakes? If so, you must take care of my business then!"

...

In this way, the cautious owner bought a case from the salesperson selling the unknown brand.

The application of this strategy is aimed at those distributors who initially have a mentality of refusing to close the deal. The essence is to use various presets to let the distributor think and weigh, thereby changing their decision.

9. The "dumbest" inventory pressure technique - multiple visits: This is the dumbest inventory pressure technique. In my training, I often say, "When you cannot change your customer with words, use your actions to move your customer." In fact, whether the distributor is willing to purchase is not very important. In many inventory pressure experiences, I have found an interesting phenomenon: many distributors do not lack money; besides worrying about slow sales and inventory occupation, they also have a psychological factor of being unwilling to easily pay out money from their pockets. The dumbest but repeatedly effective strategy to solve this factor is multiple visits. During each visit, in addition to solving the replenishment problem, you should also pay attention to the sales status. Each visit can make the distributor feel safe, at least psychologically safe, and the probability of closing the deal will greatly increase. The most taboo problem is that the salesperson is usually absent and only appears at the end of the month. If so, it is not surprising that inventory pressure fails.

10. Use promotional activities to apply inventory pressure: Promotion is also a means. While applying inventory pressure, you can use certain promotional activities as a follow-up supplement and bundle. State that as long as the distributor pays and purchases according to requirements, the factory can assist in organizing promotional activities to promote terminal sales to a certain extent. All distributors operate in a trading model, and the essence of trade is the rapid turnover of funds. Therefore, they are extremely worried that the goods they purchase will not sell, leading to long-term occupation of funds. So if you can bundle inventory pressure with promotional activities, the transaction rate will greatly increase. The disadvantage of this strategy is also obvious, which is the cost of promotion. However, from a long-term perspective, the linkage effects and results brought by promotion itself need to be objectively evaluated. This requires the factory to have good sales expense control ability in the process of bundled sales.

The ten inventory pressure techniques are not the end, but a few "bricks" I have thrown out here, hoping to attract more valuable "jade." If so, it would be great.

-END-

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