When discussing how to establish a distributor management system, it is essential to first understand that in our distributor ranks, wholesalers—especially terminal wholesalers—occupy a significant proportion. They commonly exhibit low education levels, poor marketing awareness, and loose management, which is particularly prominent in the fast-moving consumer goods (FMCG) sector. Over 90% are individually operated, and truly sound management systems with professional marketing teams are rare. 'Mom-and-pop' shops are ubiquitous, and management levels vary widely. In operations, most distributors find it difficult to derive benefits from management. Typically, few have internal business statistics or financial analysis reports; most rely on ad-hoc management with unclear responsibilities and rights. Workers sometimes follow the boss's orders, sometimes the boss's wife's, resembling pure family workshop management. So, in today's increasingly competitive market and with the growing strength of terminal channels, from what aspects should our distributors establish a management system that adapts to competitive development? Below, I will briefly discuss a few points.
Establish a 'merit-based' human resource management system: Many distributors currently favor relatives over merit. Due to small operational scales and low requirements for employee quality, relatives and friends often become core backbone members. Over time, due to personal connections, effective management becomes difficult, and this nepotism severely hampers the distributor's own development. Today, to grow stronger, distributors must introduce talent and abandon the short-sighted notion that 'family and close ones are most reliable.' Compared to upstream agents and manufacturers, distributors lack not capital but talent! In human resource management, distributors should establish a scientific talent management system, including talent reserves, pre-job training, performance assessments, and promotions, all with clear guidelines.
Establish a 'clear accounts' financial management system: Currently, many distributors' financial management only involves simple daily records of income and expenses, with arbitrary spending and incomplete procedures, failing to reflect through sound financial books. In most distributors' minds, they can use their own money as they wish, with the only approver being their 'wife,' who often acts as the 'financial director.' There are no clear standards for wages, reimbursements, shopping, or entertainment, nor sound procedures or systems to regulate them. Consequently, many distributors often wonder: 'I earn quite a bit, but why is there so little left at year-end?' Therefore, distributors must establish a sound financial management system, detailing monthly sales, profit and loss, assets and liabilities, so they can know how much they earned, how much they lost, and where to reduce costs and turn losses into profits.
Establish a 'clear responsibilities and rights' marketing management system: In distributor management models, it is common to see one person handling multiple roles, which is unavoidable for small distributors. However, due to unclear responsibilities, poor performance and mutual blame often result. In today's intense competition, we must first build a capable marketing team, clearly defining each member's 'responsibilities, rights, and benefits,' assigning sales and delivery tasks to specific individuals. For those with overlapping duties, assessment methods must be institutionalized. In marketing management, cooperation with upstream agents or manufacturers should also be carefully considered. To effectively motivate employees, market policies can be delegated, giving employees flexible operational space, linking regional market responsibilities and rights, enabling them to shed the mentality of mere workers and operate markets from a manager's perspective, thereby fostering a sense of ownership and enhancing cohesion and combat effectiveness.
Additionally, sales personnel should undergo pre-job training, competitive selection, performance assessments, and survival of the fittest. Distributors should require sales staff to report regularly at each level, provide timely market information, submit product feedback forms, downstream distributor inventory details, market dynamics, and terminal distribution details, enabling the company to respond swiftly and flexibly to market changes and monitor market dynamics.
- Establish a 'scientific and standardized' product management system: Currently, many distributors manage products extensively, letting products sell naturally. However, refined product management is more conducive to accelerating product circulation and connecting with upstream channels. First, distributors should focus on 'storefront' and 'warehouse' on-site management, implementing basic principles of 'first in, first out' and 'safety and hygiene.' Classify 'brand products,' 'new products,' and 'old products' for management. For diversified distributors, manage different categories (e.g., beverages, snacks, liquor, candies) with corresponding 'in and out' process monitoring systems. Also, monitor daily product flow and after-sales, actively cooperating with upstream agents or manufacturers to boost sales. If product quality issues arise, distributors should promptly report to manufacturers and assist in dispatching personnel for investigation and handling. Thus, product management should continuously improve in areas like 'daily store sales,' 'warehouse management,' 'delivery services,' 'loss services,' and 'rights protection services.'
Furthermore, establish a strict market research and product monitoring system. Only by continuously analyzing market consumption and product movement can reasonable market throughput be maintained, avoiding inventory backlog risks and preventing customer loss due to stockouts.
- Establish a 'complementary advantages' manufacturer-distributor cooperation system: Today, 'manufacturer-distributor cooperation' is essentially 'resource integration.' Manufacturers value distributors' distribution networks and local relationships, while distributors value manufacturers' product appeal. However, smart distributors often don't want to 'hang from one tree,' preferring to represent multiple products for diversified profits. Of course, manufacturers are also trying to prevent distributors from 'straying.' From a certain perspective, manufacturers find it hard to control distributors' multi-brand strategies, but without a complementary cooperation system, distributors can hardly achieve sustainable healthy development. Here, distributors should not favor old brands or strong enterprises exclusively but establish a system that combines 'large and small,' 'strong and weak' products.
Many distributors believe that old brands, especially those with certain awareness and reputation, have mature consumer bases and sound distribution networks, making new products easier to promote. In contrast, they dismiss unknown or new brands, considering them high-risk. But upon reflection, higher risk often means greater market opportunity. Old brands rarely offer truly new products; most are improvements or packaging changes. New brands, though initially weak in market foundation, are worth trying if product positioning is accurate, pricing is reasonable, and the manufacturer has good credibility.
Additionally, when establishing distribution cooperation with upstream agents or manufacturers, distributors must have their own business rules and bottom lines. They should have a basic system defining what they need, what they can do, and their fundamental rights. With such a framework conducive to company development, they can negotiate and cooperate with any manufacturer.
- Establish a 'continuous recharging' training and learning system: Currently, many distributors lack understanding of professional marketing knowledge, fail to grasp manufacturers' market strategies, and are vague about product features, brand culture, business philosophy, and marketing models. They struggle to guide customers effectively through precise explanations; some might praise A when customers buy A and B when they buy B, leading to slow product movement. Therefore, modern distributors must establish a scientific and effective employee training and learning system. New marketing personnel should undergo pre-job training, learning company marketing concepts, corporate culture, and product knowledge, and only after passing assessments should they be employed. Regularly organize training activities related to marketing to continuously 'recharge' employees and enhance the team's overall combat effectiveness.
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