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As an important link in the commercial value chain, dealers must consider how to achieve long-term development in the current market competition. Besides industry, product, and policy influences, whether a dealer can operate in a standardized manner becomes a significant factor. Standardized operations do not simply mean having systems, visit plans, or business personnel training and management—these are basic tasks. Today's discussion on standardized operations focuses on how dealers can become idealistic, ambitious dealers, gradually cultivating themselves into "gold" dealers, operators, and entrepreneurs.
"In war, preparation ensures success; without preparation, failure awaits." This is one of the key ideas in The Art of War. As a dealer, you must also have this awareness. In the process of moving toward standardization, I believe establishing the superstructure is crucial. The so-called superstructure refers to two aspects that affect the future development of the enterprise:
1. Do you have a strategy?
Speaking of strategy, many may think this is a matter for large enterprises; for small businesses, it seems intangible and impractical. However, this is not the case. Strategy exists for dealers, but most are unconscious of it, having only a vague concept.
So, what is strategy? For dealers, strategy is about what to do. Generally, dealers often consider products they are familiar with or those inherited from family, such as liquor, seasonings, cooking oil, etc. While operating these products, can they also operate other products? This is merely a product selection issue, but this choice determines the dealer's development strategy—that is, how to do it. We believe that dealers have two strategic options: one is to become a specialized dealer, and the other is to become a diversified dealer.
Becoming a specialized dealer:
A specialized dealer focuses on a specific category of products and holds the initiative in all value chains of that category, ultimately gaining bargaining power with upstream and downstream partners. For example, a seasoning dealer would operate all aspects of seasoning products within their capability, such as soy sauce, vinegar, MSG, chili sauce, and related products, eventually becoming a professional dealer. During development, they can first become the largest single-product dealer in the region; as strength grows, they become a multi-product dealer; at a certain stage, they may become a monopolistic dealer—this is the highest level of a specialized dealer.
Becoming a diversified dealer:
A diversified dealer does not operate everything; the key is complementarity. Complementarity refers to commonalities in the same channels or similar consumer groups. This includes the following aspects:
Product channel overlap: For example, in hotels, they need various types of alcohol, seasonings, tissues, cigarettes, beverages, etc. As a dealer, if you can establish good relationships with key hotel personnel, while supplying liquor, cigarettes and beverages may also be easy to enter—this is channel overlap. Another example is complementarity: if you supply candy to KA (key accounts), you may also supply roadside shops, but candy has no profit in KA. If you have a seasoning product with decent profit but it is a high-end product, roadside shops may not sell well. However, since you have established relationships with KA, your seasonings can quickly enter, compensating for the candy profit.
Consumer group overlap: For instance, consumers who drink alcohol also smoke; the consumer base is fixed. Can you provide gum they also need? This is multiple products targeting one consumer group.
Complementarity in product portfolio: Product portfolios have profit levels; some are profitable products, some are volume products. Profitable products may not sell in high volume, and volume products may have low profit—this is a form of complementarity. Dealers should plan their product portfolio so that volume products and profitable products interact and promote each other.
Whether becoming a specialized or diversified dealer is a form, ultimately what you want to become is a long-term goal that must be determined based on actual conditions. For example, Shaanxi Tianju Group, as the largest dealer enterprise in Northwest China, positions itself as the "spokesperson of quality." "Tianju's agency represents quality and honor." Over the years, Tianju has been committed to connecting manufacturers and consumers, selling quality products for manufacturers and delivering thoughtful service to consumers—this is Tianju's persistent pursuit.
2. Do you have a plan?
A plan is essentially a roadmap that dealers need to set to achieve their ultimate goals during the transformation from a dealer to an enterprise. After determining the strategy, systematic planning is necessary for a dealer to transform into a standardized enterprise.
However, many dealers lack this awareness: they do not know their annual sales, which products are profitable, or how much profit they make; they just know they are making money, without systematic financial systems. I believe that dealers must plan in the following areas during the process of enterprise-oriented operations:
Development strategy planning: This was already discussed under "Do you have a strategy?" What kind of dealer do you want to be? For example, how to plan as a specialized dealer? I think the first step is to operate a single category of products, then after forming a strong agency, expand to related products, and finally become a regional strong brand in a certain category. The second step is to first form a strong regional brand, then expand to surrounding areas, gradually enlarging your operating region.
Product planning: The purpose of product planning is to consider profitability for your enterprise. We know that a complete product line plan must include four basic blocks: volume products, sniper products, image products, and profit products. In the early stages, such a comprehensive product line plan may not exist, but as the business expands, product line planning becomes very important. For example, a dealer operates products from four companies (A, B, C, D) in different categories. Company A's products are volume products, aiming for fast circulation to drive sales of other products; Company B's products are sniper products, designed to attack competitors; Company C's products are image products, such as Lee Kum Kee's seasoning products, which are high-priced and have a high-end brand image, serving as image products for the dealer; Company D's products are profit products, not necessarily famous brands, but with information asymmetry, yielding high profits—this is the foundation for development.
Market planning: Market planning mainly concerns how to expand the market and what strategies to adopt. First, classify the market and analyze each type, identifying strengths and weaknesses. If entering, decide which strategies to use. Generally, markets fall into several categories: monopolistic markets, advantageous markets, balanced markets, competitive markets, and disadvantageous markets. Different marketing strategies should be adopted for each of these five types.
Of course, corporate strategy and development planning are the superstructure of standardized dealer operations. If dealers can have a clear understanding of these two aspects, while not deviating from the general direction of development, they also need support in execution, management, inspection, and other details. Only then can dealer enterprise-oriented operations have a source of water.
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