---
title: "The More Distributors Strive, the Worse the Results"
description: "In the past two years, FMCG industry growth has slowed, but the variety of products displayed at retail terminals has increased. During a recent market survey, a brand was found to have placed over 10 products in one store (normally 3-5), and when asked if they could sell, the owner seemed indifferent, saying unsold items would be exchanged. This reflects a common issue where distributors' efforts are not yielding expected results."
author: "金名"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2025-07-07"
categories: "Dealer Operations"
language: "en"
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markdown: "https://xinjignxiao.com/en/articles/the-more-distributors-strive-the-worse-the-results-37f87a61.md"
original_source: "https://mp.weixin.qq.com/s/ki3RZ2ezyQWNwVM171YOcQ"
translation: "https://xinjignxiao.com/zh/articles/%E7%BB%8F%E9%94%80%E5%95%86%E8%B6%8A%E5%8A%AA%E5%8A%9B-%E7%BB%93%E6%9E%9C%E8%B6%8A%E4%B8%8D%E5%A6%82%E6%84%8F-37f87a61.md"
attribution: "New Distribution — https://xinjignxiao.com/en/articles/the-more-distributors-strive-the-worse-the-results-37f87a61/"
citation: "金名. “The More Distributors Strive, the Worse the Results.” New Distribution, 2025-07-07. https://xinjignxiao.com/en/articles/the-more-distributors-strive-the-worse-the-results-37f87a61/"
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---

# The More Distributors Strive, the Worse the Results

> In the past two years, FMCG industry growth has slowed, but the variety of products displayed at retail terminals has increased. During a recent market survey, a brand was found to have placed over 10 products in one store (normally 3-5), and when asked if they could sell, the owner seemed indifferent, saying unsold items would be exchanged. This reflects a common issue where distributors' efforts are not yielding expected results.

**In the past two** years, the FMCG industry's growth has slowed, but the variety of products displayed at retail terminals has increased.
Recently, during a market survey, I found that a certain brand had placed more than 10 products in one store (normally 3-5). I asked the terminal: "Can you sell them?"
"No problem, if they don't sell, we'll exchange them." The owner seemed used to it.
In a small store, there was no place to display products, yet the distributor had invested fees and set up displays, but the products were buried under betel nuts, serving as a display shelf.
I said to the store owner: "The products are underneath, making it inconvenient for consumers to pick up. Will this affect sales?"
"If consumers want them, they'll pick them up themselves." The owner was indifferent.
**In the FMCG industry, slogans like "goods pile up like a mountain" and "the market is squeezed out" were once classic, but now they cause worry.**
"Over a decade ago, I purchased 1 million yuan in goods monthly, with a net profit of 100,000 yuan; last year, monthly sales approached 3 million yuan, but net profit was less than 50,000 yuan," complained an agent for a leading dairy brand.
"Every day I deliver goods to townships starting at 7 am, communicating with each store about restocking, and I can't get home until 8 pm. The work gets tiring, but the money earned is less," said a distributor boss who is both delivery driver and salesperson.
**When the industry was rising, just working hard was enough, and results were naturally good. As the environment changes, previously effective market actions gradually fail, and even if you push yourself to work harder, results remain unsatisfactory.**
**Blindly forcing inventory cannot solve market problems**
During holidays like Spring Festival, May Day, Dragon Boat Festival, Mid-Autumn, and National Day, almost all FMCG companies carry out special campaigns, including distribution, displays, and promotions. At these marketing nodes, foot traffic increases, consumer demand is released, and compared to usual times, the same resource investment can bring more sales opportunities and increase sales.
However, now such activities are increasingly becoming "chicken ribs" (something of little value).
During the recent May Day holiday, a leading dairy company organized all staff to follow trucks for inventory pushing. An old friend called to complain, "Now terminal sell-through is clearly slowing down, and many store owners are unwilling to stock up, or don't want to stock too much."
"In that case, your May Day inventory-pushing action becomes less efficient."
My reasoning was: "First, with slow sell-through in stores, you'll face more resistance from store owners during inventory pushing; on the other hand, later exchanges and handling of near-expiry products will increase distributors' operating costs; if the exchange is not handled well, it can damage terminal relationships."
Originally an efficient action, because terminal sell-through was good and there were few near-expiry products, both distributors and terminals could profit. Now, with sell-through generally slowing, still using past experience means distributors and terminals bear greater risks (since manufacturers do not share the increased risks in the current environment).
If you only push inventory and don't care whether it sells, a series of troubles will follow. Especially when manufacturers do not provide extra support for near-expiry products, distributors must consider the issue of near-expiry products after pushing inventory; otherwise, the more they push, the more they lose, and the faster they die.
Recently, I chatted with an excellent sales manager (who consistently met targets): "Now manufacturers' targets grow year after year, but terminal sell-through is poor. Distributors can only rely on warehouse stocking to meet manufacturer targets, but this is not a long-term solution; they will eventually be crushed. If they don't stock, they may be eliminated by the manufacturer. How do you solve this dilemma?"
"Knowing that products have exceeded market limits, still blindly pushing distributors is like killing the goose that lays the golden eggs or draining the pond to catch fish. Such a salesperson is not a good one."
"We must hold the inventory red line and not squeeze a cooperative distributor to death. If the distributor quits, the business can't survive either. My approach is to open a new customer in a low-share area, which is a stopgap. Of course, the core is still to help distributors quickly clear inventory, focus on terminals that can sell, and carry out appropriate sell-through activities at terminals. For stores with good business, in-store activities won't have bad results."
If manufacturers only push inventory without providing follow-up solutions, they don't care about distributors' survival. **Any business model that profits unilaterally is not sustainable.**
**All resource investments and tactical actions should aim at sell-through**
**The environment has changed; places with high-value returns have become low-value. Allocating resources and actions to low-value return places is basically throwing money away.**
Previously, products placed at terminals could basically sell, so resources and energy were concentrated on terminal inventory pushing, which was fine; now, with terminal sell-through problems, resources and energy are still concentrated on terminal inventory pushing, making product stagnation the norm.
In the current environment, the misunderstandings in terminal inventory pushing are increasingly prominent:
1. Terminal selection does not consider reality: The terminal's business is poor, but the owner is easy to talk to, so you push a lot of inventory and run consumer activities there, but no matter how much you invest, there is no output.
2. Unreasonable product structure: To boost sales of high-end products, you increase the inventory ratio of high-end products at terminals, reducing the quantity of main products while increasing high-end products. As a result, main products are in short supply, high-end products stagnate, missing sales opportunities for main products, and then you have to invest more to handle the stagnant high-end products.
**In the current environment, inventory pushing should also aim at sell-through, and resources and tactical actions should be designed around sell-through.**
Narrowly defined, sell-through means consumer activities; broadly defined, it is a series of actions that facilitate rapid product sell-through.
**For distributors, focusing on terminals with high foot traffic and products recognized by consumers is also a means to accelerate sell-through.**
**First, choose "valuable" stores for inventory pushing, deliver normally to other stores, and abandon inefficient stores.**
Leverage the store's foot traffic to drive product sell-through; rather than investing heavily to attract traffic to a store with poor foot traffic, which is like a blind person swatting mosquitoes—wasting effort.
I know an old distributor who has been dealing with terminals for years and knows which stores have good business, which are poor, and which are suitable for what grade of products—he knows them like the back of his hand.
This customer said bluntly, "I also push inventory at terminals, because if you don't, competitors will, and your share will shrink. But I choose stores suitable for product sales to push inventory."
In recent years, although single-store capacity has declined, this customer has continuously squeezed competitors' share by precisely seizing terminal resources, with sales steadily increasing.
Apart from inventory pushing, companies used to promote "deep distribution." Now, the more thorough the deep distribution, the less money distributors make.
Previously, products placed at terminals could basically sell, and even remote stores wouldn't lose money for distributors; now, many stores have poor sell-through, more near-expiry products, and some stores have small output; after accounting for logistics and near-expiry handling costs, they lose money. So, the more such stores are distributed, the more losses.
In an incremental market, you can cast a wide net; in a shrinking market, you must select stores precisely.
**Second, focus on products that generate the most sales or profit, selectively operate other products if capable, and abandon products that lose money.**
Without extra promotional resources, focusing on products better matches consumer demand and improves sell-through efficiency. Products that don't sell are a waste of resources.
A few days ago, I visited a customer whose sales are growing. Although the company has dozens of products, he only handles 3: one for volume, one for profit, and one for high-end cultivation. Occasionally, when the manufacturer has policy support, he stocks a bit based on terminal suitability.
"There are few near-expiry products. When they have 3 months left, I recall them and handle them centrally at a few terminals with good sales. This year, I added a high-end product with company activities, sold in large supermarkets, and sell-through is good so far." The customer beamed.
Many customers with declining sales or complaints about not making money have an important reason: too many products (of course, some are forced by manufacturers), all pushed to terminals, and some products even expire in the warehouse before leaving.
Some distributors have relied on inventory pushing to meet manufacturer tasks for a long time, and it's become hard to change. They have over a dozen or even dozens of products in the warehouse, most of which far exceed market absorption capacity. They must "slim down"; without change, losses will only worsen.
A friend shared a case: a major customer of a large manufacturer (distributing multiple leading brands, with annual sales over 50 million yuan) lost money for 3 consecutive years and finally couldn't hold on, exiting the business.
In the first year of losses, they hoped to earn it back next year and expected manufacturer subsidies; in the second year, they still lost money, even more, but unwilling to give up, they gritted their teeth and continued because of fixed investments like warehousing, full inventory, and team, and no suitable successor; in the third year, they still lost money and finally decided to exit.
**Wrong product configuration only increases the burden on business and customers, leading to mutual complaints and harm.**
**Allocating limited resources to key elements is the fundamental reason for maximizing efficiency**
Changes in the environment can make previously efficient actions less efficient, or even stumbling blocks.
New channels, new consumer demands, and new business models emerge endlessly. Everyone is aware of these changes, but they don't know how to respond, so they are anxious.
In such a situation, we need to analyze and understand deeper issues: what is the essence of change, what has changed, what hasn't, and whether doing this now will benefit the future. After recognizing key elements, we can adjust strategies and focus resources to improve efficiency.
In the new environment, what actions are effective? What model is the core direction for distributors' future development? How should manufacturers and distributors collaborate efficiently now?
At the [New Demand · New Supply 7th FMCG Conference] and [5th China FMCG Distributor Conference] held in Shanghai from August 19-21, we invited nearly 10 outstanding FMCG distributors, including traditional trading giants with over 1 billion yuan in scale, successful B2b transformation cases, and category operation benchmarks. They will share their cases from different dimensions to help everyone find the direction suitable for distributor development.
If you are interested in discussing together, you are welcome to come!
**🔺


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## Citation metadata

- Publisher: New Distribution
- Author: 金名
- Published: 2025-07-07
- Canonical: https://xinjignxiao.com/en/articles/the-more-distributors-strive-the-worse-the-results-37f87a61/
- Original source: https://mp.weixin.qq.com/s/ki3RZ2ezyQWNwVM171YOcQ

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