Click to read the original text for details. In the process of distributing manufacturers' products and operating in the market, distributors must keep their eyes open, maintain a clear head, and not easily believe manufacturers' "sweet talk." Remember the following five "bargains" that must never be taken:
1. Advance Payment Subsidies Many food manufacturers launch promotions such as scratch-card prizes or bottle cap cash redemptions. Some manufacturers, to encourage distributors to actively redeem prizes, even introduce redemption rules, clearly stating that distributors should advance the prize money, and the manufacturer will later pay a redemption subsidy of 110-120%. For such redemptions, distributors should try to settle with the manufacturer as soon as possible, ideally once a month, to avoid significant losses due to unexpected events. If the manufacturer reneges, decisively stop selling some of the redemption products and renegotiate the redemption terms with the manufacturer to avoid getting deeper into trouble.
In addition, for some promotional expenses, such as advance payments for order meetings, promotional activities, or advertising costs that distributors pay upfront for market development (e.g., TV ads, storefront signs, lightbox ads), it is essential to have an agreement with the manufacturer. When signing the contract, it is best to have the manufacturer pay a portion first, such as 50%, to avoid the manufacturer denying the agreement or deliberately claiming the acceptance failed to refuse payment, ultimately hurting you.
2. Unusually Large Promotions The purpose of promotions is to boost sales, fundamentally to drive terminals and consumers. However, some manufacturers, to quickly enter the market, often "sell at a loss for publicity." When the market rebounds and sales rise rapidly in the short term, due to differences in company strength and motives, they may run out of stock or face shortages. At this time, influenced by the market's "hot sales" trend (which may be a false impression), many distributors often lose themselves, feel confused in the whirlpool, and easily fall under the manufacturer's control, eventually falling into a trap and suffering losses.
Therefore, when faced with large-scale promotional activities, distributors must carefully and cautiously examine the manufacturer, observe their strength, understand their background, and be wary of manufacturers' "desperate acts" to avoid being dazzled by the "flowers." Learn to calculate, understand that "no one does business at a loss," and thus be cautious in investing and stocking up, reducing market operation risks caused by being misled.
3. Excessive Returns on Prepayments Some food manufacturers, to attract distributors to join, often offer rewards for paying a certain amount of goods in advance. For example, some manufacturers offer a 12% reward for a one-time payment of 500,000 yuan, attracting many distributors. But once the money falls into the manufacturer's pocket, things often get out of your control.
For instance, a small biscuit manufacturer relied on absorbing large amounts of customer funds and offering high rebates to raise capital for market operations and heavy advertising. When customers demanded products, they used funds from one source to pay another, juggling finances. When the company could no longer operate and distributors demanded payment, the company was already insolvent and beyond rescue. Distributors cried out to heaven and earth but got no response. Such bargains must never be taken.
4. Large Inventory Subsidies Many manufacturers, during peak sales seasons, to prevent distributors from running out of stock, often introduce stock-pushing policies, such as advising distributors to rent warehouses and offering warehouse subsidies, thereby "luring" some distributors to stock up heavily. Once the peak season passes, if products become unsold or slow-moving due to various reasons and pile up, going back to the manufacturer to discuss exchanges or returns is often like "asking a tiger for its skin"—it is very difficult to persuade or move the manufacturer to accept returns. You can only watch helplessly as your funds are tied up and cannot circulate effectively.
Therefore, when encountering such subsidies, distributors must accurately judge based on their own strength, sales volume, and safety stock, to avoid being trapped.
5. Seemingly Attractive Shelf-Stocking Policies Many food manufacturers, to open up markets or to achieve ulterior "money-raising" purposes, often set attractive shelf-stocking policies. They sell products originally worth a few yuan for ten or even dozens of yuan, then offer 30-50% as a shelf-stocking policy for distributors. Some even offer a delivery truck or van as a reward for a 500,000 yuan payment, in addition to the shelf-stocking policy, making some "greedy" distributors excited and unconsciously step into the manufacturer's trap. Such bait thrown by manufacturers can make some distributors infatuated.
But because the price of such products deviates from their value, after a period of vigorous operation, market response is generally lukewarm. When distributors realize the products are unsold and piled up and request returns, the manufacturers often "slip away like oil on the floor," leaving distributors with product backlog, tied-up funds, and even losses from discounted disposal. Distributors may cry but have no one to blame but themselves.
Source: Cui Zisan Marketing Vision
On October 23-24, during the Autumn Sugar and Wine Fair, New Distribution will host the "2018 FMCG City Distribution Logistics Conference." New Distribution will invite industry experts, FMCG warehousing and distribution specialists, and distributors who have transformed to unified warehousing and distribution platforms to discuss and answer questions about future trends in FMCG city distribution logistics and practical cases of distributor transformation to unified warehousing and distribution, hoping to bring you different inspiration and thinking! The specific agenda is as follows:
List of Participating Companies (In no particular order) Hunan Zonglan Diandan Network Technology Co., Ltd. Jingbang (Wuhan) International Freight Forwarding Co., Ltd. Mengniu Dairy Qinghai Hanxiang E-commerce Co., Ltd. Unilever Service (Hefei) Co., Ltd. Shanghai Branch Huicong Hunan Xuan'ang Food Co., Ltd. Guangzhou Tongdaoren Information Technology Co., Ltd. Qingdao 888 Trading Co., Ltd. Uni-President Enterprises (China) Investment Co., Ltd. Hunan Zhongxiang Gongpei Logistics Co., Ltd. Shenglong Ingredients COSCO Shipping Logistics Warehousing and Distribution Co., Ltd. Guangxi Yongpai Liquor Co., Ltd. Shangqiu Kangrong Trading Co., Ltd. Jinan Dingzhong Economic and Trade Co., Ltd. Liaoning Bimai Agricultural Technology Co., Ltd. Kunming Xiongjia Trading Co., Ltd. Shaanxi Houheng Trading Co., Ltd. Guangzhou Dingwo Enterprise Information Consulting Co., Ltd. Shaodong Jiajiale Commercial Firm Boda Trading Industrial Bank Changsha Branch Wuhan Muchen Convenience Store Chain Co., Ltd. Fujian Fuxing Yuncang Logistics Co., Ltd. Guizhou Yilimi E-commerce Co., Ltd. Jiangxi Xiao Laoer E-commerce Co., Ltd. Jinshan Koufu Shanxi Taihang Yuanjing Supply Chain Management Co., Ltd. Shanxi Dezhun Supply Chain Co., Ltd. Shaoyang Tongdeli Trading (Xiangbang Logistics) Huanfu Tongda Express City Distribution Beijing Xinjingxiang Food Co., Ltd. Wuhan Huizhong Tianhong Liquor Co., Ltd. Changsha Paide Biotechnology Co., Ltd. Chao'an Tuqiang Guizhou Yihe Bopin Supply Chain Management Co., Ltd. Jiangxi Kang'en Industrial Development Co., Ltd. Xiangtan County Yisuhe Town Yuhua Paper Store Luoyang Yuanlang Trading Co., Ltd. Tongchuan Yaozhou Huayuan Supermarket Co., Ltd. Hunan Yongfu Jiujiu Trading Co., Ltd. Zhejiang Chengchengtong Logistics Co., Ltd. Chongqing Kaiguo Materials Trading Co., Ltd. Beijing Xianmaixianmai Data Technology Co., Ltd. Hanchuan Qixing Trading Co., Ltd. Tongxin Jiuzhiru Trading Co., Ltd. Guizhou Meiguo Guoguo Network Technology Co., Ltd. Hubei Anjie Logistics Co., Ltd. Hubei Kuaixiao Internet Technology Development Co., Ltd. ......
Representatives of Distributor Transformation (Tentative) (In no particular order) Rong Jun, Chairman of Jiangsu Huashang City Distribution Network Co., Ltd. Wang Bo, Chairman of Hubei Yijiaren Logistics Co., Ltd. Jiang Shuming, General Manager of Sichuan Chengdu Xingrenxing Trading Co., Ltd. Liu Jichen, Chairman of Shandong Yunbang Warehousing and Logistics Co., Ltd. Tu Mingyu, Chairman of Chongqing Lingyu Consumer Goods Supply Chain Management Co., Ltd. Yang Su, Chairman of Guangzhou Zhongshan Wanrong Marketing Co., Ltd. Yuan Xia, Chairman of Sichuan Bajie Supply Chain Management Co., Ltd. Li Qiangyun, Co-founder of Hubei Pengdun Meiyitian Supply Chain Management Co., Ltd. Zhang Jianyong, Chairman of Henan Xuchang Jiulegou E-commerce Co., Ltd. Ma Haichao, Founder of Hebei Changyi Logistics Co., Ltd. Meng Yucun, General Manager of Hebei (Chengde) Wulian Yuncang Co., Ltd. Zhang Xun, Chairman of Xinjiang Urumqi Su'an Jinchi Logistics Co., Ltd. Zhang Hailing, Chairman of Jilin Sansheng Lian'gou Qiang Huitao, Founder of Hebei Dunjie Supply Chain Management Co., Ltd. Liao Lei, General Manager of Hunan Damei Supply Chain Management Co., Ltd. ......
On October 23-24, the 2018 China FMCG City Distribution Logistics Conference hosted by New Distribution will be held in Changsha. Industry experts have sent their blessings for the conference; click the video to watch. For more details, see the original text.
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