Many distributors consult me about transformation topics. Some ask upfront if I can recommend sales management software; others might be more subtle, saying the article resonates and they face similar issues, asking what to do now. I generally don't answer these questions directly because there's never a standard paradigm for distributor transformation. So I usually ask distributors: what's your sales volume, what brands do you represent, and in which region? After asking these basic questions, I give some personal opinions. Why do this? Although distributors all engage in FMCG distribution, differences in product categories, scale, and regions often lead to different strategies and tactics. This doesn't even include internal factors like the distributor's personal business mindset, management methods, and values. No standard answer doesn't mean no direction. Most distributors operate within a fixed region, with a relatively small physical business radius. Target customers are无非 traditional small shops, restaurants, KA stores, CVS convenience stores, and some special channels like internet cafes, tourist attractions, and corporate group purchases. With a limited business radius and clear target customers, it's relatively easy to find common operational characteristics. Last year, New Distribution launched a column "New Distribution 100 People," focusing on practical cases of excellent distributors during the internet era and channel transformation. Recently, by studying these cases, New Distribution identified three core traits: efficiency, opportunity, and partnership. The following describes these traits, hoping to provide reference for distributors facing difficulties. Efficiency Distributors often mention "efficiency": "Xiao Wang, can you be more efficient? You only visited 15 stores today. Can you improve efficiency and visit 20 or 25?" Distributors usually focus "efficiency" on making employees work more, forgetting whether the company's business can improve efficiency. Before 2013, the industry didn't pay much attention to efficiency because of demographic and market dividends. Launching a new product and expanding market coverage basically met annual sales tasks or growth targets. But markets can't grow indefinitely, and dividends will disappear. When dividends vanish, it becomes a stock market, and grabbing cake is inevitable. As middlemen, distributors must help brands grab market share. How? Stage 1.0: add people and vehicles to expand store count; Stage 2.0: implement sales management systems to monitor and track performance. Whether 1.0 or 2.0, distributors haven't escaped extensive management. The typical feature of extensive management is relying on people; more people, more volume. Salespeople account for over 80% of the company, with back-office staff mainly handling orders and finance. Stage 3.0 requires distributors to shift from extensive to refined management. Refinement has two parts: business refinement and management refinement. Business is external; management is internal. Business refinement: One salesperson handling 150-200 stores is the peak. After that, consider how to get more orders from limited stores. This relies not just on visit volume—a salesperson's time is limited—but on how to increase sales at good stores, add items at average stores, and increase order frequency at low-volume stores. Business refinement isn't just about sales; it emphasizes operations. Use historical sales data to operate existing stores well, improving per-store output and frequency. Distributors like one-on-one sales, but today they should focus on data behind sales: per-store, per-item, per-time sales, margins, and costs. Let data guide sales, not just people. Relying on people is still a human-wave tactic. Management refinement: Most trading companies have only one manager—the distributor—with others as executors. To pursue profits, distributors often judge by sales volume. Piece-rate and sales-based commissions are the most common management forms. The goal of maximizing benefits remains, but the management logic behind it can't be ignored. For example, in salesperson management, how to align employees with the boss's stance in sales, rather than holding customers hostage to demand resources and policies from the boss? Employees only do what you assess, not what you expect. If you assess sales, they'll only do sales. If you assess store coverage, they'll open stores but not maintain them. Distributors should keep sales in mind and talk about processes. If you assess shelf displays, employees will do displays well, and sales will follow. If you turn terminal arrears into interest costs as part of sales costs, see if credit sales or arrears ratios decrease. What is efficiency? More output per unit time, per person, per investment. Distributors shouldn't first consider adding people or vehicles; consider how to create higher returns with existing people and vehicles. How to mobilize external business and internal management to maximize returns. Opportunity Frankly, today's successful distributors seized opportunities in past historical periods. This opportunity was often catching a brand. They rose by relying on a brand, achieving entrepreneurial success. Today, the possibility of distributors relying on a brand to move up is increasingly slim. Fragmented consumer demand and diversified retail scenarios mean future products will be more long-tail and niche. We often say the era of billion-yuan single products is over because of external consumption changes. Distributors can no longer rely solely on upstream brand opportunities. Downstream small stores, B2B platforms, and online e-commerce are all potential opportunities. With new retail emerging, can distributors connect immediately? Recently, I chatted with Mr. Li Yong of Shenzhen Yataixuan Industrial. They cooperate with Luckin Coffee, providing light snacks like chocolate nut bars, selling thousands of boxes daily. New retail is diverse; distributors must participate, not reject or look down on it. Of course, stay alert to avoid scams. When B2B platforms emerged, distributors were initially worried, but later, as B2B had periodic blowups, they seemed relieved and secretly pleased. Both worry and secret joy are inappropriate. As competitors, distributors must study them, seeing both good and bad, to understand their tactics. Channel digitalization is irreversible, regardless of current state. As a new technology, the internet will transform offline; it's just a matter of time. If distributors see the trend, they should consider cooperating with leading B2B platforms like JD New Channel or Alibaba Retail Link. If capable and top three locally, they might build their own platform. Online e-commerce: distributors shouldn't think it's just opening a store on Taobao or Tmall. They need an online e-commerce mindset. Pinduoduo, currently in vogue, is recruiting offline distributors; community group buying is booming; distributors have local warehousing and small store resources—can they try? Can they move offline business online to improve transaction and communication efficiency with small store owners? In the past, distributors liked vertical opportunities—upstream brands, downstream stores—but now they should also look horizontally. Even for vertical opportunities, broaden horizons. Watch new products from FMCG giants and online influencer brands. When influencer brands go offline, evaluate them immediately; they might be a second growth point. Partnership What is a distributor's core asset? Salespeople. But today, almost all distributors face difficulties in recruiting, retaining, and managing people. Meanwhile, higher salaries and more flexible work are attracting salespeople away. Salespeople are the core source of business; think deeply about maintaining relationships. "Partnership" requires distributors to re-examine their relationship with salespeople—not just employment but partnership. To retain salespeople, they must feel they're working for themselves, not the boss; the boss just provides the stage. More specifically, distributors provide capital, goods, tools, and bear operational risks, while salespeople are the protagonists in the market. How to achieve partnership? In past New Distribution case reports, there are roughly three forms: First, business partners: The core is to promote capable salespeople to independently operate a product category or market. As the saying goes, survival depends on the boss, longevity on the team. Who doesn't need management? Only the boss. Make excellent employees partners for a specific category, with independent accounting and profit/loss responsibility. As a trading company, it's hard to provide clear, long-term career plans like formal enterprises. Without career plans, with the boss above, salespeople can't have bright expectations. Since promotion isn't possible, help them open a new battlefield. Second, small boss project: This is like Didi drivers starting businesses on the platform. Distributors provide goods, tools, reward standards, and task assignments. Let small bosses cultivate their own "one acre, three parts" of land. Many do sales not just for income but also for relatively free and flexible work. Distributors should abandon "manage, watch, stare" and let employees freely perform on a set stage, with more work yielding more rewards. For example, a salesperson handles a specific area, managing 100 stores, with hundreds or thousands of products to "perform" freely. Third, profit-sharing system: How do distributors get net profit? Sales revenue minus costs. Distributors must increase sales revenue and reduce costs. But salespeople often think only about revenue, not costs. Sell more, earn more. At this point, salespeople want to sell more to customers, often siding with customers to demand policies and rebates from distributors. In their eyes, the distributor is a big boss earning a lot. What is profit-sharing? Only with profit is there a share. If net profit relates to salespeople, they must increase revenue and reduce costs. A display fee of 1,000 yuan usually buys two displays; can a salesperson use relationships to buy three for 1,000? Certainly. Terminal credit sales are costs; charging interest makes it a salesperson's cost. Would they then consider reducing arrears? Repeatedly instill the concept of net profit sharing, aligning salespeople with the boss, seeking benefits from the market, not from the distributor. Summary Improve operational efficiency because distributors have indeed thought less and lacked refinement. In early 2019, JD proposed quality growth, essentially meaning online traffic dividends have disappeared; how to improve operational returns within the existing user pool is key for enterprises facing stock markets. Distributors must rely on management, operations, and data to improve ROI among existing customers. When one wave of dividends disappears, another follows. Distributors have developed for nearly 30 years. The first wave was demographic demand; the second was brand rise. Where's the next wave? B2B, online e-commerce, new retail, and influencer brands might be the third wave. Professor Chen Chunhua says the traditional employee era is disappearing, and individual value is rising. Salespeople are key to distributor revenue; fully consider how to leverage human efficiency and deeply bind with salespeople. Transform the company into a platform, making salespeople independent entrepreneurial individuals to fully showcase talents. High income for salespeople leads to high growth for trading companies. Focus on FMCG distributor new distribution/brand new marketing cases To communicate with the author, long-press to add WeChat. When adding, please indicate company, position, and name. Related extended reading: Tips will be paid 400-2000 yuan once adopted. China FMCG + Internet Professional New Media Committed to FMCG manufacturer transformation and channel digitalization solutions