---
title: "This Beverage Once Fought Over by Distributors, Why Is It Rapidly Declining?"
description: "At the 2017 Chengdu Sugar and Wine Fair, glucose rehydration drinks were a hot category, with many brands exhibiting and distributors rushing to secure agency rights, leading to rapid nationwide distribution. A year later, New Distribution investigated the product's performance and found a starkly different reality: poor sell-through, unsold inventory, and a market that has largely rejected the product outside of special channels."
author: "澄韵 袁来"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2018-07-22"
language: "en"
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# This Beverage Once Fought Over by Distributors, Why Is It Rapidly Declining?

> At the 2017 Chengdu Sugar and Wine Fair, glucose rehydration drinks were a hot category, with many brands exhibiting and distributors rushing to secure agency rights, leading to rapid nationwide distribution. A year later, New Distribution investigated the product's performance and found a starkly different reality: poor sell-through, unsold inventory, and a market that has largely rejected the product outside of special channels.

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At the 2017 Chengdu Sugar and Wine Fair, the category of glucose rehydration drinks was very popular. Brands of all sizes set up booths to recruit distributors, and distributors flocked to them, quickly spreading the products across the country. This year, on some recruitment advertising pages, it has become popular again. In these ads, manufacturers of all sizes have sprung up like mushrooms, promoting that distributors are stocking up by the truckload, and the shelf displays in the market are very impressive. This caught the attention of New Distribution. A year later, how is this product actually selling? Unexpectedly, the investigation by New Distribution reporters revealed a different picture.

01
**After covering 200 outlets, dared not expand further**

A distributor named Li Ming revealed to New Distribution that after the "hype" of glucose rehydration drinks at last year's Spring Sugar Fair, he targeted this category and had a glucose rehydration drink brand OEM-produced under a well-known pharmaceutical group. He lamented that he thought this product would take off, but it "died" so quickly, having been in operation for only about half a year. Currently, glucose rehydration drinks can only be sold in special channels like gyms, yoga studios, and swimming pools. Traditional mass circulation channels are completely ignored. July is the peak season for beverages, yet the sell-through of glucose rehydration drinks remains a challenge. In such an environment, sales are barely enough to make ends meet; can we expect anything in winter?

Li Ming told New Distribution that after getting the product, he distributed it to 200 outlets in his network, but except for one foot bath shop that ordered it mainly as gifts for customers, other outlets basically had no movement. After covering 200 outlets, he dared not expand further. This includes previously recruited distributors in surrounding areas who made the first payment and received 200-300 cases, but no one has made a second payment, and some distributors have requested returns for part of their products.

Subsequently, New Distribution also asked a regional sales manager, Wang Feng, about the market prospects of glucose rehydration drinks. He shook his head and told New Distribution that this category has no vitality and is just a short-term product. The best-performing distributors we have now sell only 300-500 cases per month, and only in some special channels.

High gross margins can drive the channel but cannot pull consumers. According to him, for a 1*15*500ml glucose rehydration drink, the supply price to distributors is 30 yuan per case, and the supply price to terminals is about 50 yuan per case. The retail price in circulation terminals is 5 yuan, and in special channels it is 6-8 yuan per bottle. Despite high gross margins and vivid display, the difficulty of sell-through is akin to climbing to the sky. It is understood that a well-known pharmaceutical group's brand has 10-20% market investment, as well as promotional activities like "1 yuan enjoy, buy one get one free," and even CCTV advertising investment, but none of this can leverage the product's sell-through.

02
**Why has it fallen to such a state of neglect?**

According to New Distribution, there are not a few major brands entering the glucose rehydration drink market, but the vast majority are led by well-known domestic pharmaceutical groups, such as Sanjiu Group, Jiangzhong, Sanjing, and Hayao. In addition to these pharmaceutical groups, various glucose rehydration drink brands with different packaging and concepts have also emerged.

With the endorsement of well-known pharmaceutical companies trusted by consumers and being a highly "conceptual" product, why has it fallen to such a state of neglect?

From the perspective of the 4Ps of marketing—product, price, place, and promotion—the retail price of 5 yuan is in the mainstream price band, and the price chain in the channel with high gross margins is sufficient to drive the channel. Promotion (brand communication) also includes a well-known pharmaceutical company that spent 20 million yuan on CCTV advertising. Although the return on investment is declining, it should have some effect, but in reality, it doesn't. There is also offline market investment. Although it is not done well, it should not lead to such dismal sell-through.

Ultimately, the fit between the product and consumer demand is crucial: glucose solution was originally needed by patients when hospitalized. Now, placing this product in a different scenario—the mass market for daily consumer goods—is clearly out of place. When do consumers need it? If a product is placed in a circulation supermarket, do you expect consumers to drink it when they are "sick"? For sports, I can drink Mizone; for physical labor or driving, I can drink Red Bull; for reducing internal heat, I can drink JDB... When in daily life do I need to drink glucose rehydration drink? It is hard to find an original market.

From the perspective of brand and category awareness, the appropriate scenario for glucose rehydration drink should be sports, but the sports scenario is already covered by existing brands. Consumers' consumption mindset for "sports" has been completely occupied by Red Bull, Mizone, etc. At the same price point, consumers do not have high recognition of this product's efficacy. Although consumers have basic awareness of glucose rehydration drink, the past awareness environment was in hospitals and wards. A simple example from daily consumption: popcorn is widely known, and its basic awareness is in cinemas. As a snack, you almost never see consumers holding a bucket of popcorn in the office or at home. Popcorn's basic consumption awareness is in cinemas. Similarly, the basic consumption awareness of glucose rehydration drink is in hospitals. Li Ming told New Distribution: currently, both medicine bottle packaging and daily bottle packaging are not selling well, but the medicine bottle packaging similar to hospital glucose injections is especially hard to sell. Many consumers think, "I'm not sick or in pain, why would I buy a bottle of medicine to drink?"

**Final Thoughts**

Currently, when distributors choose products, they mostly consider channel, price, promotion, and the company and quality behind the product, but rarely think about the extension of the product—the consumption scenario it satisfies. Especially for "innovative" products, there is very little consideration of new categories.

In the view of New Distribution, for such "innovative" products that have not been market-verified or widely consumed, and require market cultivation, the choice of agency should be very cautious. In the current "downturn" of FMCG distribution, distributors must not pin their hopes of profitability on new categories or products, fantasizing about becoming "overnight millionaires." Not to mention whether the glucose rehydration drink category can be built up, just from the market cultivation cycle, distributors do not have enough patience to wait and consume business energy.

We often say that when distributors choose products to represent, they should consider a combination of first-tier, second-tier, and third-to-fifth-tier brands. They should consider the brand's market operation model, market investment support, and gross margin space, but the premise of these considerations is that the category has been market-verified and there are comparable products of the same type and level. Clearly, categories like glucose rehydration drink are "high-risk" products. In today's market environment, the gambler's mentality is outdated, and seeking stability is the main theme of modern distributor operations.

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