---
title: "Wandering Distributors"
description: "Over the past decade, the world has changed dramatically, and the FMCG distribution landscape has shifted from a channel-dominated era to one requiring product focus and strong management. Distributors now face the challenge of adapting to new retail realities or being left behind."
author: "冷冻君"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2019-02-16"
language: "en"
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---

# Wandering Distributors

> Over the past decade, the world has changed dramatically, and the FMCG distribution landscape has shifted from a channel-dominated era to one requiring product focus and strong management. Distributors now face the challenge of adapting to new retail realities or being left behind.

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What has happened in the world over the past decade?
Scientists have discovered 12,866 asteroids;
300 million people have been born on Earth;
Internet users have increased 270-fold;
The new retail era has arrived.
During the 2019 Spring Festival, the Chinese sci-fi film "The Wandering Earth" gave hope to young people across China.
During the 2019 Spring Festival, many distributors saw themselves in the movie.
The sun engulfing the Earth is merely fiction in the novel.
But for distributors, the era they are in is forcing them to flee or change.
**The Gold Rush Era: Channel is King**
When goods are traded in large quantities, distributors emerge.
Over the decades, distributors have grown from few to many, from simple to complex. From starting from scratch to becoming wealthy.
**In the FMCG industry, distributors have always practiced the principle of "winning at the terminal, terminal is king."**
This era was once called the era of "lying down and making money" by many distributors.
In 1978, when reform and opening-up began, FMCG products were a new type of commodity in the new economic order, and distributors faced a natural, fragmented market.
Before China's highway network was formed, geography fragmented the market. In the early days of reform and opening-up, the logistics system was not yet established. Facing a land of 9.6 million square kilometers, the market was not connected.
At that time, the network covered by distributors was very small. For manufacturers to deliver products to consumers, they had to go through provincial agents, city agents, county agents, second-level and third-level wholesalers, and retailers before reaching consumers. Each step consumed product profits.
We find that local Chinese FMCG brands have not produced world giants like Coca-Cola or Nestlé. The main reason is that the fragmented market structure caused enterprises to consume a large amount of resources in the channel field.
At this time, the market environment was a goldmine for distributors.
**Display, customer relations, promotions, shelf restocking, terminal interception, promotional posters, and visit routes—these are the things the older generation of distributors excelled at.** Guard a region, cover every outlet, maintain good relationships with each one, and you could sit in your store, make phone calls, and do the accounting. Even if you sold unknown products, even homogeneous products, you could sell better.
Many distributors believed that as long as they controlled the channel, they controlled the lifeblood of product circulation. So, distributors arranged daily visits to terminal customers, and the "eight-step visit" process came into being. Salespeople memorized every step from entering the store to leaving, all to maximize their product display and optimize shelf space.
In a city, whoever was diligent made money, and whoever worked hard sold goods. The era of terminal supremacy influenced a generation of distributors.
In this era, distributors didn't need to think; as long as they were diligent and represented a few major brands, they could grow big and strong and have a say locally.
**Crisis Arrives: Channel Decline**
After 2010, many distributors found that promotions seemed to have no effect on consumers. Moreover, expensive end caps and special displays had less and less impact on sales. In supermarkets, increasing fees made it hard for distributors to breathe. In the trade market, distributors were also struggling, as the costs of maintaining the market increased, and these could not be passed on to consumers; the only ones bearing the cost were the distributors.
Thus, distributors not only faced pressure from manufacturers to stock up but also had to prepay various fees. The pressure was immense.
**And the root of all this is the price war.**
In a city, almost all distributors represent first-tier products, which to some extent help them maintain channels better. But profits are very low. In addition, many distributors have a herd mentality: if a brand sells well for someone else, they want to sell it too. Soon, all distributors in the city are selling it. Differentiated products become homogeneous again.
Some say, can we avoid price wars? Of course, but you need to be prepared to deal with others. For example, if you have multiple brand resources, differentiated products, or alternative sales channels. If you have none, then even if you don't start a price war, others will, and you'll be the first to die.
When all resources are focused on the channel, we ultimately don't get a good outcome.
We want to sell more goods, but we rely solely on the channel.
With the spread of mobile internet, information travels faster, and the cost for distributors to obtain resources is getting lower. Developed logistics shorten the distance between enterprises and distributors, and urbanization broadens consumers' horizons.
**Planetary Engine: Focus on Products, Strengthen Management**
In the new era, for distributors to develop better, they must return to the basics. Blindly competing on channels will only hurt themselves. We need to cultivate internal strength and transform into service providers, offering comprehensive services to second-tier wholesalers and terminals. We use our knowledge to help them grow.
Distributors' thinking can no longer be about how many cases they sell each day, but rather about looking to the future and grasping trends.
And product selection is the key to a distributor's success.
In the new consumption era, consumers care more about the product itself, packaging features, and taste, in addition to the brand. Distributors should be good at discovering new products and identifying those with potential. This requires distributors to understand consumers and market demand, and to enter precisely.
Taking the path of enterprise management is something distributors must do. In the harsh market competition, building a systematic, standardized management and operation platform that adapts to market competition and enhancing their own management capabilities is key to improving competitiveness.
Distributors are no longer just movers of goods, but decision-makers who determine the development of enterprises.
If possible, try to grow bigger and stronger.
That way, you will have the bargaining power to deal with enterprises, you can easily operate across regions, you can undertake logistics and distribution beyond your own, and if you like, you can even develop your own brands for fun.
Now, distributors have moved into the circle of friends. From learning about the world to placing orders, a mobile phone can do it all. Technological progress brings many conveniences, but also anxiety. If previously distributors could see their competitors, now you don't know who will eliminate you—whether it's the neighbor next door or an app on your phone.
Ten years ago, it was "winning at the terminal"; now it's "winning with products." With bestsellers as the goal, your position becomes more solid. People often say, "Good products speak for themselves." Now we should say, "Good products need to chat."
In "The Wandering Earth," humanity takes 2,500 years to redeem itself.
For distributors in reality, as long as you're still in this industry, you must keep a clear head and master the latest knowledge.
In 2019, we are the changemakers. Some say, "I've been doing this for over a decade, and I have no regrets."
Source: Frozen Food Marketing (ID: lengshinews)
New Distribution will hold the **2019 (5th) FMCG + Internet Conference** during the Chengdu Spring Sugar and Wine Fair from March 16 to March 18. This conference will focus on the topic of **"Breaking the Game"** and engage in in-depth discussions with numerous brand owners, supply chain service providers, distributors, retailers, and others.
Compared to previous conferences, this summit will be fully upgraded. In addition to the original topics of **channel innovation, city distribution logistics, and distributor transformation**, it will add multiple parallel forums on **new marketing cases, IP + FMCG empowerment, community group buying, and innovative retail**. Through three days of ten high-density, high-quality expert sharing and exchanges, we believe every brand owner and distributor can learn the latest business models, expert insights, and practical methods, finding new tools and methods to break the game in 2019 and return to the track of rapid growth.
Review of Previous Conferences
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