Every year during the off-season, some manufacturers, instead of conducting market activities to expand sales, find fault with their distributors, all for a good data report! The factory personnel are bent on forcing distributors to stock up, even to the point of not stopping until the distributor's warehouse is packed to the brim.

Nowadays, many brand company executives and salespeople seem to have hit a dead end in marketing, as if there's no way forward. These companies only know how to push inventory onto distributors, assign sales tasks, and then collect payments, and that's it! Worse, they haggle with distributors every quarter and month, demanding they meet monthly targets in exchange for rebates. Whether the goods sitting in the distributor's warehouse can be sold is the distributor's own problem.

In reality, when goods move from the factory to the distributor's warehouse, sales have just begun. The distributor must then resell to secondary wholesalers or retail terminals, and retail terminals must sell to consumers. Only when consumers repurchase after using the product can sales truly be considered complete from a marketing perspective.

As a manufacturer's marketing personnel, you must consider how to help distributors and retail terminals sell the products. Otherwise, you won't even know if your products are sleeping in the warehouse. So, how can you help distributors turn products into sales? I believe you need to do well in at least the following three aspects:

1. Plan Well

First, plan the channel strategy for a region. Channel planning means deciding which channels your products will sell through: KA stores? BC stores? Circulation channels? Or closed channels? This planning should come before the product; choosing products based on channels is the correct approach. Product-first-then-channel is a selling logic, while channel-first-then-product is a marketing logic. When channels select products, the products' sell-through power is stronger; otherwise, it becomes hard selling, which is thankless.

Second, plan which products will sell in the chosen channels. Many large manufacturers simply push new products onto distributors without consideration. They demand that you get the new product into 200 stores within a month, then 300 more in the next two months, regardless of whether they sell. You just need to get them in; the entry fee is paid by us, the company's goal is to get in first, distribution is the key, and display or shelf placement is a hard target. Whether they sell is another matter. Distributors can't say no, and they must enter the stores, after all, it's not your money.

Third, plan the price differentials. The gross margin for channel partners is crucial; as the saying goes, "All the hustle and bustle is for profit." What incentives do you offer to the distributor's sales staff, including promotional staff?

The last and most important point is how you differentiate your product in the market. What activities will you run, and what support will you provide? Will you use in-store demonstrators or give direct rebates to buyers? Will you do buy-one-get-one or special pricing? Will you do in-store or out-of-store events? These are specific details, and getting them right is how you sell your products out of the distributor's warehouse.

2. Implement Personally

After making the plan, don't just issue orders for distributors to execute. You must implement the plan yourself to see if it's feasible. Many executives at big companies only point and draw on paper, not understanding how fast the market changes, the actual level of competition, or consumer psychology and purchasing trends.

Case Study: After planning the product and sales plan, salespeople reported that distributors were unwilling to sell. Why? The salespeople couldn't explain. The boss and I went to the market ourselves to hear what distributors said. They generally said the new product's price was high. I asked: Is it higher than first-tier brands? They said it was lower. How much lower? About 25%. Higher than whom? They said it was 10% higher than third-tier brands. Oh, these distributors had been operating in the circulation channels of third-tier brands, so they immediately noticed the new product was pricier. Seeing this, I suggested the boss hold regional distributor meetings, and I personally conducted an educational session, focusing on analyzing channel changes, the future for distributors, and their current situation. Then I suggested they try operating in certain channels of first-tier brands. After this, some distributors felt enlightened, as if they saw a new world. Once they started, they no longer felt the product was overpriced, and their salespeople went to negotiate with stores with confidence.

3. Review Timely

After products go to channel partners, is the plan reasonable? Are the products suitable for sale? Do distributors approve? What's the shelf placement rate? What's the sell-through rate? What's the popularity rate? Every company needs to analyze and study these in a timely manner.

It's essential to review the plan's feasibility regularly. Register distributor inventory daily, weekly, and monthly, help distributors sell off their stock, and review why distributors are unwilling to stock up or why products aren't selling. Review is summary, review is reflection, and review is an indispensable means for progress. It's also a task our sales personnel must diligently fulfill.

So, it's easy to get a girl pregnant, but it's hard to be a responsible man; similarly, it's easy to "get a distributor pregnant" (i.e., push inventory), but it's truly not simple to be a responsible manufacturer and responsible marketing personnel!

Liang Shengwei (12 years in marketing, 8 years in management, over 6 years of enterprise consulting experience, focused on the survival and development of weak enterprises. Author of the book "Building a Quasi-Listed Company Management Model".)

The 2017 (3rd) FMCG + Internet Conference will be held in Chongqing in November 2017. The conference will closely focus on the theme "New Forces, New Ecology" and invite 1000+ distributors, 500+ brand owners, 200+ B2B platform founders, and 100+ investment and financing institutions to explore new chapters of cross-border integration!

Click the link below to review the highlights of the first and second FMCG + Internet Conferences:

2016 "FMCG + Internet" Summit Forum

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