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When I started writing this article, I kept wondering: Can most of our frontline supervisors and salespeople really "manage" distributors well? That's a big question mark! That's why I put quotation marks around "manage." I'm sure that over 80% of grassroots sales staff, even supervisors, can't handle distributors, let alone those "big and powerful" ones. But looking back, if a supervisor can't manage distributors well, what would happen to the market? I dare not imagine. The harsh reality is: this happens every day.
【Scenario Case 1】 Successful "Management" Xiao Chen is now a supervisor at a food company. He worked as a salesperson for one year and as a supervisor for three years. The distributors in his area exceeded the company's targets every year and every month. More importantly, one distributor he managed went from zero to the company's No.1 in less than three years. Based on his "outstanding" performance, the company is about to promote him to regional manager.
I've talked with him a lot. In such fierce competition, how did you achieve this as a regional brand? At first, he was modest, just saying he sold it case by case. But as we talked deeper, you realize how important the distributor's role is. We talk about terminals every day, but how many domestic companies bypass distributors and directly do terminals? How many succeed? Even Gree, the leader in home appliance air conditioners, made many mistakes on direct operation, franchising, and entering hypermarkets, which remains a headache. Besides, the air conditioning industry is quite different from FMCG.
In the food and beverage industry, ignoring channels (distributor and second-tier wholesaler networks) will inevitably increase management difficulty and cost overruns, which the model cannot avoid. Abandoning such an important partner's strength and spending your own manpower, materials, and money is really not worth it.
He said his best achievement was mobilizing the distributor's enthusiasm and all resources, making the distributor follow his thinking. I asked, how did you mobilize them? Why did the distributor listen to you? He said, first, you need to know the market well and have a clear strategy. If you're confused yourself, how can you convince the distributor? Lead by example, work hard, and infect the distributor. Second, you need to understand his business better than he does. That's hard, but you must do it. Third, help the distributor improve management and systems. This is crucial; otherwise, people come and go, and nothing accumulates or remains. Fourth, team building. This is the core: training, guidance, assessment, promotion, and shaping a combat-ready team.
He said on his first day at that distributor's place, he went to the warehouse, and that day only 10 cases were shipped (pure natural sales). That's absolutely true, he said, you can call and ask now. After that, he and the distributor's boss delivered goods together, carried goods, developed outlets, special channels, and even set up tasting tables in densely populated residential areas, selling products on the spot... Of course, now he doesn't need to carry goods or visit small shops every day, but the passion for market development accumulated over the years is still there. He said he still occasionally goes to the distributor, sometimes drives together for store visits, and communicates and improves during the process.
With this, how can the market not be done well? How can any distributor not be "managed" well?
【Scenario Case 2】 Poor "Management" Above I talked about a successful case of "managing" a distributor. Now let me talk about a very unsuccessful example. I always believe that the absolute difference in IQ among people is not large, except for a few geniuses like Jobs, Gates, Buffett, etc., who are exceptions. What matters is that we are good at thinking and summarizing, and most importantly, dare to do and execute. Knowing is easy, doing is hard; it's always a simple truth, but if we dare to face it, sometimes many things are not as difficult as imagined. But do we dare to face it?
Xiao Li is a regional supervisor at a beverage company. He has stayed in various regions for a while, and among the company's distributor circle, he has a poor reputation, mainly because he can't help distributors and doesn't play a role. After contacting him for a while, I found that Xiao Li is not unwilling to do things, nor does he lack execution; the problem lies in work skills and methods.
For example, distributors are unwilling to complete tasks according to contract, unwilling to use the company's invested personnel and promotional expenses for market promotion, not cooperating with daily management, terminal development... Many unwillingness, and supervisor Xiao Li is basically helpless. He either does his own thing, completely ignoring the distributor, and forms his own so-called "team."
After operating like this, he finally found himself very tired, the distributor remained indifferent, and the market naturally didn't improve, making it hard to complete monthly tasks. The only constant was the need to push inventory at month-end. The distributor said to him: Complete tasks? Then tell me how to complete them! At this point, you probably understand. Is this called "management"? What have you brought to the distributor? That's the most important thing.
Xiao Li found he could no longer push inventory to the distributor, so he started thinking about opening new distributors, which is like "cutting flesh" from the distributor, taking away his territory. Isn't that robbing his money? So the situation worsened, relations became more rigid, and it was almost out of control.
【Scenario Case 3】 Collusive "Management" The supervisor mentioned above has no problems in personal character and essence; it's a matter of skills and techniques, which can be changed. But what I'm about to say is not about skills and techniques, but about character. If character is problematic, all skills are useless. Xiao Zhang is a regional supervisor at an FMCG company. He has been there for 10 years, stuck at the supervisor position, unable to go up or down.
He said he stays because he doesn't want to suffer at other companies. The pay here is a bit less, but he doesn't need to run the market every day. He has "good relations" with distributors, so going once a week is enough. At most, he works harder at month-end to push inventory. To achieve this, there are conditions: various expenses are basically packaged and given to distributors. How much can be done, how much expense actually reaches the market, only heaven knows. Such a market eventually moves toward "collusion," where everyone "eats" from expenses, but the market gets smaller and smaller, space shrinks, and finally, like a frog in warm water, it goes into shock until it dies.
What do the above three cases illustrate? Successful management can make a regional brand beat a national brand; poor management is like playing with fire, and the market shows no improvement; and "collusion" causes a good market to decline rapidly, handing it over to competitors.
The Basic Skills of Distributor "Management": One Core and Three Key Points
A. One Core: Start from the "Core" of the Business What is your role for the distributor? It's to enable his business to continuously develop and make more money. Everything you do should revolve around this core; otherwise, no matter how much you talk, it's all in vain.
Combine long-term and short-term goals. Making money from products is the most basic, but you can't calculate this account every day. It may be hard for every product to make money, but overall it must be profitable, because each product has a different role: some for volume, some for image, and some just to lubricate the channel.
In the long run, it's about building the distributor's reputation, brand, and channel relationships, serving future greater development.
B. Three Key Points:
First, Be Good at Calculating Calculate small accounts. Does the distributor make money from your products? This question seems simple, but not every supervisor can grasp it. For example, a distributor says, "Doing your products doesn't make money; the monthly gross profit is only a few thousand, and net profit is half of that..." How do you calculate with the distributor? After communication, you find that the distributor basically doesn't do terminals, the market foundation is extremely poor, and all product sales rely on dumping goods outward. The distribution channels seem many, but in reality, they sell whatever they can, without management, service, or maintenance. What should we do in such a situation? We should communicate like this: First, do the market solidly, focus on getting products to terminals to increase profits, and also help distributors establish controllable networks, which is the best way to stabilize prices. Our experience is: the better the market foundation, the more stable and higher the prices. Second, the second-tier channel is not for dumping goods, but for radiating to areas the distributor can't cover, using distribution power to achieve normal product flow. Learn to stabilize, control, and stimulate the distribution network. Third, if you don't make money? Dumping goods at low prices, no matter how much support you give, is a bottomless pit. Distributors doing other products, like first-tier big brands, have huge inventory pressure and capital occupation. Once there's a slight change, the risk is huge, and the opportunity cost is also high.
Calculate big accounts. Look at return on investment (ROI), not just gross profit. Big brands have larger sales, and high-profit products do show distributors small volume but high profit. But in reality, it may be superficial. We can use the distributor ROI profit model to illustrate: Distributor ROI = annual profit or average annual profit / total investment × 100%. Distributor ROI refers to the unit return on the funds the distributor invests in our products, i.e., investment efficiency. ROI = net profit after tax / total assets = net sales margin × total asset turnover. That is, how much did the distributor invest in each product, and what is the turnover rate? This gives the overall return.
From a business layout perspective, what role does your company and product play in his business? Even a supporting role can have highlights. It's important what the distributor treats your product as: a platform for integrating resources, a means to shape influence, a way to contain competitors, or to share risks... You can always find a sufficient reason for the distributor to continue doing your product.
Second, Effective Communication Respect. Only when you truly treat others as equals in communication will it be effective. Don't be condescending, nor servile; this is the most basic principle. Effective communication is not endless discussion and repetition; it's clarifying both sides' needs, defining problems, and finding the balance point and the real needs behind surface needs.
Let others understand what you're doing, and also understand their position and what they can do in the process, and the necessary cooperation. Many times, there's a process for doing things.
Third, Improve Management "Iron camp, flowing soldiers." When you build an iron camp through improving recruitment, training, assessment, and promotion, new people can quickly integrate and get up to speed. For example, channel management, terminal development and maintenance, daily visit work, assessment systems, monitoring systems, etc., aim to standardize and improve efficiency. Only when the overall management level rises can the distributor's business truly be sustainable, and only then will the distributor truly thank and admire you.
Fourth, Make Friends A general principle for dealing with distributors is: "Make friends, close but not inseparable." At the beginning, things outside business are more important, like family matters. If a distributor shares these with you, you've actually succeeded halfway. Ultimately, the work is outside the poem; sometimes things outside business can better do business.
The important criterion for "successful" friendship is: the distributor is willing to "corrupt" with you or accept your "corruption" invitation outside work hours. Here "corruption" of course doesn't mean illegal activities, but normal entertainment, gatherings, etc., outside work.
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