In casual chats with distributors, one often hears that business is getting tougher. The days when distributors could act like “bosses” in front of manufacturers are long gone. When selecting brands and products, they must keep their eyes wide open, or they may end up wasting time and money, losing both the bait and the fish. Nevertheless, many distributors, who became wealthy in the 1980s and 1990s through courage and opportunity, still cling to past glories in the 21st century. When dealing with manufacturers armed with new ideas, they often react passively, and some even fall into traps set by unscrupulous manufacturers (especially in the liquor industry, where new brands and tricksters abound each year), ending up like ST stocks with little hope of recovery. To help more distributors avoid these pitfalls, the author analyzes various manufacturers' tricks for reference.
The Sky-Scattering Net Trick: Many well-known or obscure brands claim to recruit distributors globally or nationally, boasting that distributors in model markets have amassed fortunes of millions within three months or a year. In reality, a quick inquiry reveals that the recruiting company's annual turnover may be less than a few million. There is a model where the manufacturer selects a national general agent, say in Beijing, who, after helping the manufacturer succeed in the Beijing market, jointly recruits distributors nationwide. This general agent, regardless of whether other markets succeed or only slightly succeed, becomes the top of the wealth pyramid. Can you replicate such a model market? Here, you are merely a small fish in the manufacturer's net.
The Mirage Trick of High Rebates and Comprehensive Advertising Support: Many such offers are castles in the air. Today's manufacturers are extremely shrewd; they demand cash on delivery or payment before shipment (because social trust is poor, especially in recent years), as they must protect themselves from risk. After the distributor pays the full amount for goods, advertising fees, promotion fees, and staff salaries are all borne by the distributor. If the market succeeds according to the manufacturer's wishful thinking, these expenses may be reimbursed; but if the market fails to launch, these costs are often written off, and the manufacturer suffers no loss regardless of your losses.
The Underdog Turnaround Trick of Shifting Flowers and Working the Market in Reverse: Some manufacturers, lacking local reputation to attract suitable distributors, resort to more cunning tactics. One distributor told me this story: An obscure liquor brand from Guizhou failed to find distributors in their market. In August or September, the manufacturer sent two people and hired local staff to start distribution. A month later, they approached the same distributors with more favorable terms, with the manufacturer bearing all initial distribution risks and continuing to assist in the local market. Seeing this tangible effort, many distributors were tempted and signed contracts, paying for goods. The rest is predictable: the manufacturer withdrew cleanly (the initial distribution goods were already in their budget), while the distributors were left stunned, with the market never truly launching and their expenses unlikely to be recovered anytime soon.
The Chain Trick of Giving Away Vehicles and Promotions: In the past year or two, liquor manufacturers often offered vehicles and promotions when recruiting distributors. For a payment of 100,000 yuan, they'd send goods worth 120,000 yuan, plus a delivery van, and promise a certain number of promoters and sales staff, along with over 30% advertising investment for new markets. Any distributor could see that the liquor was essentially free. But remember, there's no such thing as a free lunch. In today's liquor market, which brand can quickly launch a market with just 100,000 yuan? Moreover, with such large operational margins, even if you succeed, you'll be flooded by parallel imports from other markets. A sub-brand of a famous listed liquor company adopted this model at the end of 2001, and within less than a year, who could still see this brand in the market?
The Fishing Trick of Recruitment Advertising: We often see new faces on CCTV's prime time slots, but they usually last only one to two months, at most three, before disappearing. These brands use the fishing trick. They lack the capability to cover the national market but want to create the illusion of a national brand. Their advertising aims to support their recruitment process. Once recruitment succeeds, they select one or two key markets to operate, and due to limited funds, the vast majority of “fish” markets become mere spectators, waiting to foot the bill for the recruitment ads.
Of course, manufacturers' tricks are not limited to the above; due to space constraints, I won't elaborate further. How can our distributors develop sharp eyes to avoid being tricked?
Improve Your Overall Quality: In today's society, those who don't learn fall behind and get eliminated, especially those distributors who became wealthy in the 1980s and 1990s. Learning enhances your analytical and judgment abilities, and your market grasp. There's an ad slogan in Sales and Marketing: “Your competitors are all reading this book!” Indeed, if the devil rises a foot, but the Tao doesn't rise ten feet, how can you subdue demons?
Don't Refuse Small Good Deeds, Don't Chase Excessive Profits: Seeking profit is a distributor's nature; without profit, how can one be a merchant? As the saying goes, “The way of business is the way of humanity.” Wanting to quickly open the door to wealth is like “Sesame, open!” Facing the temptation of profit, our distributors should be extra cautious.
No Investigation, No Right to Speak: Whether it's a model market or recruitment ads, don't be stingy with your feet and inspection costs if you're genuinely interested. When visiting model markets, don't notify the other party; run, walk, listen, and observe more. Record the most authentic parts, then communicate with the manufacturer. At that point, they can't fool you, and they'll respect you more. When they choose strategic markets for key investment, they'll definitely come to you!
Be Good at Building Your Own Brand: As a distributor, your distribution network, financial strength, character, and business reputation are all components of your brand. Don't be a one-man show; listen to your subordinates' opinions. As bystanders, they may see things more clearly. Brands are not exclusive to manufacturers; Ye Maozhong is a brand, Liquor Marketing is also a brand. Once your distribution brand is established, more and better brands will seek sincere cooperation with you, and your risk of being tricked will greatly decrease. Just kidding, you might even trick others.
In fact, whether manufacturer or merchant, in this society that increasingly values integrity and in this business environment that emphasizes credit, setting traps harms others and yourself. If you lose your credit and your integrity is unseen, who will believe you next time you launch a new product and recruit distributors? In this highly information-driven era.
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