Introduction: The environment has changed, and only distributors who adapt can survive and thrive. Author | Ren Wenqing Andy Proofreader | Gou Gou Layout | He Wen

The rise of the new generation of distributors. This is a phrase that has been echoing in my mind after visiting distributors recently. What is a new-generation distributor? There is no strict definition, but several dimensions provide reference: they are mostly born in the 1980s and 1990s, they trust data more than experience, and they actively use online tools to support offline business. Compared with traditional distributor bosses, they are more open-minded, more agile in thinking, and more willing to try new things. Recent articles in New Distribution have introduced several such distributors. For example, Zheng Jinbin, who grew his county business from 30 million yuan in annual sales to over 100 million in three years; Jia Yongshun, who grew from 2 million to 200 million in a county with a population of 800,000; Liu Fen, a post-90s female boss who became a regional distribution benchmark in seven years; and Zhong Guangtian, who transitioned from traditional offline business to a combination of online and offline, achieving sales of over 100 million. Is it enough to assert that the new generation of distributors is rising just by seeing a few outstanding young distributors? Indeed, we are talking about individual cases, but what I want to say is: What matters is not the phenomenon, but the logic behind it. These samples are individual cases, but what can we read from them? Let me tell a story first. In 1859, an Englishman published an epoch-making masterpiece that caused a huge response as soon as it appeared. In this book, the author put forward a viewpoint: "The species that survive are not the strongest, nor the most intelligent, but the ones most adaptable to change." You have certainly guessed that this Englishman is Darwin, and the book is "On the Origin of Species." His viewpoint has a famous name—the theory of evolution. Why talk about evolution? Because it is the most fundamental thought for understanding the competitive world we live in—and it is also a thought we often overlook.

Why has your business been able to grow over the past few decades? Is it because you are capable? Perhaps. But essentially, it is because the services you provide are more aligned with the requirements of brand owners compared to others. You have found your ecological niche in the local commercial circulation industry, and by following market development, you can achieve considerable natural growth. So why have some distributors been eliminated and their businesses failed? On the surface, it is because business has been taken by competitors, revenue cannot cover costs, or brands have chosen others. But essentially, it is because your enterprise cannot adapt to environmental changes. The environment has changed, and only distributors who adapt can survive and thrive. This is a fundamental perspective. In the past few years, distributors have found it hard to do business, and everyone has two intuitive feelings: one is that channels are becoming increasingly fragmented; the other is that there is a serious oversupply of goods. Behind these two feelings are two important variables—technology and population. The fragmentation of channels is driven by the emergence and application of mobile internet technology and various digital tools, while the change in supply and demand is behind the declining birth rate over the past few decades, the disappearance of natural market growth, and the fact that everyone has to compete for existing market share. Technology and population are slow variables, but they are the fundamental forces that determine trends. What is a trend? In the foreseeable future, it is irreversible. What is the use of understanding this? Technology is objective, channel fragmentation is a reality, population trends are beyond our control, and competition for existing market share will only intensify. Indeed, we cannot change the environment. But the thought of evolution tells us that what we need to do is never to change the environment, but to adapt to it. How to adapt?

Actively embrace technology? Operate through all channels? Study changes in consumer demand? These are actually specific actions. Today, let us pull the perspective back to a more core element—the distributor boss himself. What does that mean?

In the past few years, New Distribution has visited many distributors, and we have found that more and more post-80s and post-90s individuals are becoming the main force in the commercial circulation industry. Compared with the previous generation of distributors, what are their differences? First, believing in personal ability VS believing in professional teams. In the early days, distributors who seized an opportunity and grew relied on the boss's personal ability, while new-generation distributors build governance structures, formulate management processes, and naturally believe in the power of professional teams. They will try every means to find partners, set up compensation and performance systems, and use digital tools to improve efficiency. They adopt a more open and equal posture in internal management. Second, guarding their own turf VS actively sharing open resources. Many traditional distributors, perhaps due to inner insecurity and a sense of lack, guard their own business, are meticulous in calculations, and have no idea of sharing resources to grow together; while new-generation distributors actively seek complementary resources for cooperation. They are more confident and open, which is well reflected in our exchanges. Facing our questions, they do not evade but share their experiences very candidly. Third, being accustomed to following orders VS being more willing to think independently. Traditional distributors grow up following brands and are used to working under the guidance of manufacturers, while new-generation distributors are not bound by identity or fixed frameworks; they have stronger independent thinking ability and are more willing to try new things. Many new-generation distributors have tried B2B, community group buying, Douyin, O2O, etc., in the early years. They may not have developed a large business scale, but continuous attempts have brought them many additional resources, such as brand, thinking, and vision. In the current market environment, new-generation distributors have great advantages. To sum up in one word, it is—commercial rationality. This is a word I repeatedly mention. What is commercial rationality? In the past, seizing an opportunity and maintaining good relationships was enough to do business and make money, but now it is not. You must try every means to improve efficiency, reduce costs, and provide real value to customers. Relying on experience and intuition to do business no longer works. You need to have a deeper insight into the essence of business, and rely on business frameworks, data, and logic to make decisions. You need to use processes, systems, and organizational capabilities, and rely on digital tools to improve efficiency and build competitiveness. Obviously, new-generation distributors have an advantage in this regard.

On the one hand, this stems from their growth environment. Most of them have received a well-rounded education and have strong learning and thinking abilities. Moreover, they have grown up with China's marketization process, experiencing the golden period of China's commercial development over the past few decades. Compared with the previous generation, they have a natural understanding of the market, business, and rules. On the other hand, the people who grew up with them have become the main participants in market transactions. According to statistics, from 1962 to 1971, China's annual birth population was around 25 million, and by 2022, they are retiring at an average rate of 20 million per year. This means that a large number of post-80s and post-90s are accelerating their growth into the backbone of society. For distributors, whether it is upstream brand owners, downstream terminal customers, or their own team members, they are basically of the same generation. There are fewer generational differences in thinking, discourse systems, and ways of doing things, and their communication and collaboration will be smoother and more efficient. More importantly, they are also more likely to understand current consumers. This is quite important. A post-90s distributor boss said: Traditional distributors do things to meet needs, while new-generation distributors do things to create needs. What does that mean? Traditional distributors sell whatever the manufacturer has, while new-generation distributors use online platforms such as e-commerce, Douyin, and Xiaohongshu to understand what young people are buying nowadays. Then, in turn, they work with offline supermarket managers to figure out how to make offline a destination where young people are willing to stay and spend. In the future, distributors must understand consumers, combine online and offline, and have the ability to help terminals sell goods. The era of simply moving goods to terminals and making money is over. These are all advantages of new-generation distributors, summed up in one sentence: They are more adapted to the current environment. Does this mean that the older generation of distributors has no chance?

In an exchange with Zheng Jinbin of Shilangman Food, I asked a question: Compared with the previous generation of traditional distributors, what is the difference? He thought for a moment and said: Maybe the difference is just two words: the previous generation is "defending," while we are "attacking." One is defending, the other is attacking, which is very well said. As mentioned earlier, the so-called new-generation distributor has no strict definition; age is only a reference, or age is a constraint, not a decisive condition. What does that mean?

Post-80s and post-90s distributor bosses, due to their growth experience, are more likely to adapt to changes in the market environment.

But age is not the key; the key is the spirit. The so-called spirit is whether you still have ideas about future possibilities!

More and more outstanding post-80s and post-90s distributor bosses are becoming the backbone of the commercial circulation industry. At the same time, there are many post-60s and post-70s distributor bosses who are actively thinking about transformation directions and seeking transformation paths.

Just wanting to guard the existing business, or even just getting by day by day, this kind of mental aging is the fundamental reason for eventual elimination. The environment is changing. What are the characteristics of a commercial circulation business that adapts to changes? It must combine online and offline; it must learn to study changes in consumer demand; it must improve efficiency through digital tools... Why is this so? I will provide a systematic analysis in later articles. What I want to say here is: If the older generation of traditional distributors still have ideas about future possibilities, they should actively adapt to changes; if they really cannot keep up, then let go boldly and let the young people do it! After all, young people have more spirit and a stronger enterprising attitude toward the future. This is, after all—their era.

Ren Wenqing, Dean of the New Distribution Digital Research Institute, FMCG industry analyst, and lead of the bC Integration column. His research areas include channel digitalization, distributor business growth, and new retail in FMCG.