Friendly reminder: Click the blue words “FMCG Distributor Professional Consulting” above to learn more about marketing and distributor internal management. Friendly reminder: Click the blue words “FMCG Distributor Professional Consulting” above to learn more about marketing and distributor internal management. When it comes to developing township and rural markets, several basic concepts naturally come to mind: suitable products, reasonable prices, stable channels, and appropriate promotions. If these few words alone could explain the big topic of township and rural market development, it would be almost impossible. Perhaps because facing the vast rural land of our country, with its diverse consumption habits, it is hard to explain in one or two articles what is suitable, what is reasonable, what is stable, and what is appropriate. This article focuses on the practical operations of baijiu enterprises in township and rural markets, omitting the above basic parts, and explores channel setup, customer selection, channel management, and business operations. I. Characteristics of Consumption and Product Sales in Township and Rural Markets

  1. Overall characteristics of township and rural markets: These markets have large populations. With the increasing consumption level and awareness in townships, it is expected that in the future, they will grow at a rate 4%-5% higher than urban markets annually (data from Nielsen).
  2. Township and rural markets are highly potential markets. Economic development is unbalanced; there are huge differences in consumption levels and habits between the eastern and southern coastal areas and the central and western inland regions. For example, consumption levels in rural areas of the Pearl River Delta, Yangtze River Delta, and coastal areas are close to urban levels, while consumption in central and western rural areas is at another level. Generally speaking, the most notable feature is market dispersion: geographically dispersed, scattered retail stores, and relatively dispersed purchasing power.
  3. Consumer psychology, consumption habits, and local characteristics and customs vary greatly by region. However, overall, township consumption is still at a relatively functional stage, emphasizing the actual use value and material value of products, rather than added value and spiritual enjoyment. Price and taste will be important factors affecting product sales. Baijiu is a seasonal consumer product influenced by consumption habits, which is more evident in townships. Compared with urban market customers (including wholesalers and terminals) who are accustomed to sales personnel from various types and manufacturers, business personnel's visits to township and village-level customers, especially terminal customers, still have a significant psychological impact. II. Analysis of Baijiu Retail Channels in Township and Rural Markets The channels in township and rural markets are interrelated, actually consisting of three levels: county town channels, township seat channels, and village-level channels. From the terminal perspective, the relationship among the three is: urban terminals + town seat terminals = village-level terminals. The number of terminals is related to population, with an average of one terminal per 200 people, and about one terminal per 350 people at the village level. In terms of sales volume, rural non-immediate consumption terminals are 90% of urban areas. Note: These data may vary by region and are for reference only.
  4. Baijiu products are mainly sold at retail, with retail stores concentrated in townships, fewer in villages (natural villages); they are usually sold alongside condiments, beverages, and food.
  5. The purchasing relationships in retail channels are relatively stable (this is very important for distributor selection!!). Generally, township baijiu retail stores are mainly wholesale and retail combined, while natural village retail stores are mainly retail (bulk purchases can enjoy certain price discounts). Restaurants that can sell baijiu are mostly concentrated in townships or at transportation hubs (or roadside); there are basically no restaurants in rural areas. The population and geographical dispersion of townships and natural villages directly lead to the dispersion of baijiu retail stores and restaurants.
  6. Analysis of township consumer characteristics:
  7. Low brand attention.
  8. Focus on price and taste.
  9. Relatively fixed purchase locations.
  10. A large proportion of purchases are for business gifts.
  11. Many purchase regularly.
  12. Non-immediate consumption accounts for a large proportion.
  13. Concentrated purchasing: such as on market days or gatherings.
  14. Analysis of wholesale channels in township and rural markets:
  15. Small capital strength
  16. Poor development awareness
  17. Mixed selling, not specialized
  18. Small purchase quantities
  19. Most lack complete legal procedures
  20. Limited distribution service capabilities
  21. Wholesale and retail combined Generally, distribution customers in township and rural markets have low loyalty and are easily influenced by product prices and sales policies; product distribution by distribution customers is usually in a natural state, with low competition among customers. The characteristics of baijiu consumers and retail links in township and rural markets determine that the channel structure is both long (many links) and wide (many distribution customers). Special note: The current channel structure in township and rural markets means that whoever controls the township distribution channels owns the market. III. Establishment of Distribution Networks in Township and Rural Markets
  22. Development guiding principles: Principle 1: Determine the setup of distributors (generally first-level distributors with contracts or agreements with the company) or second-level wholesalers (those signing tripartite agreements with the company and the first-level distributor) based on the township's population. Principle 2: Determine distributor setup based on economic development level, number of terminals, and total baijiu market capacity. Principle 3: Determine the number of distributors based on the capital strength, distribution capabilities, and other conditions of township wholesale customers. Principle 4: Select second-tier customers in a planned manner based on the distribution network status of the confirmed distributors; second-tier should effectively supplement the distributor's coverage capability. Principle 5: Decide whether to establish special second-tier distributors among second-tier customers based on their sales capabilities, cooperation with the company, and market importance.
  23. Establish customer files for township and rural markets; Create detailed files for first-tier, second-tier, wholesale-retail combined customers, and terminal customers in the regional township and rural markets. The files should effectively reflect the customer's purchase and sales relationships, product varieties, and sales volumes. Dynamically update customer files during regular or irregular market visits. Based on customer files, systematically sort out the supply relationships of first-tier—second-tier—terminal. On the basis of sorting supply relationships, clarify the business areas or service customers of first-level distributors and second-tier distributors. Gradually strengthen the regional management and customer service responsibilities of distribution customers, establish and improve regional management systems or customer service responsibility systems, and promote further stability of the channel network. Strengthen business visits and customer relationship maintenance for distribution customers and key township terminal customers:
  24. Management of business personnel customer and terminal visits: Clarify the customer visit responsibilities and regional management responsibilities of business personnel in township and rural markets. Reasonably set visit routes based on customer distribution, types, levels, and visit frequency in township and rural markets. Develop simple and practical business visit processes, standards, and visit recording tools. Strengthen supervision and assessment of business personnel's township customer visits. Establish effective customer relationship maintenance management systems and implementation rules. Reasonably use sales policies and promotion policies to achieve the dual goals of market development and customer relationship maintenance. According to the characteristics and needs of township distribution customers, consider their profit needs and business expansion needs when introducing sales policies. According to the characteristics of township and rural market customers and consumers, promotion policies can be combined with their production needs to ensure diversity, flexibility, and practicality. Strengthen customer relationship maintenance with distribution customers and key consumer representatives through humane holiday and birthday greetings. Through complete business files, establish supply connections (procedures, systems, etc.) between distribution customers and their lower-level customers, effectively integrate order calls and pre-delivery phone contacts to clarify product delivery needs. Company business personnel set scientific and reasonable product delivery routes based on the types of lower-level customers, product needs, and purchase frequency, and implement regular route delivery. Principles for setting delivery routes: Based on the principle of reasonable and effective use of personnel, time, and transportation tools. The households on the route should be based on dynamic customer files or detailed records. The number of customers on the route is based on one delivery quantity. Routes start and end at the distributor's warehouse or store. Routes are set with the standard of full distribution to existing direct sales customers and lower-level distribution customers, while also allowing for some flexibility. Customers on the route should have primary and secondary distinctions, and the work content should be clarified before departure, such as which customers are distribution customers and which need payment collection. Assist distributors in clarifying the business content, procedures, and responsibilities of delivery personnel and vehicles, and implement post responsibility systems. Ensure the safety stock of lower-level distribution customers and terminal customers: Gradually guide lower-level distribution customers and terminal customers to increase safety stock awareness (generally, product inventory under normal conditions should reach 1.2-1.5 times the sales volume of one supply cycle or sales cycle). Emphasize the concepts of supply cycle and safety stock in supply agreements. Provide certain policy preferences and rewards to customers using safety stock (generally using sales point deductions or year-end rewards). Emphasize the importance of safety stock when supplying lower-level customers. Combine lower-level customers' safety stock with your regular route sales. Use lower-level customers' safety stock and your regular route sales to effectively avoid customer stockouts. Use lower-level customers' safety stock to ensure timely delivery services under normal circumstances. To ensure the effective implementation of safety stock methods for lower-level customers, business personnel should guide or assist distributors in establishing relevant service systems: Product age management system and operating rules. Commitments for adjustment, exchange, and return of safety stock products for lower-level customers. Procedures and systems for regular inventory counts of lower-level customers' stock (clarify responsible persons, methods, and tools).
  25. Distributor regional management Strictly define the region (or customer supply responsibility) for distributors. Regional division in township and rural markets must be clear to facilitate business guidance, planning, and market management, and to set targets (especially regional coverage and share indicators) and performance assessments. Regional division should consider market capacity, consumption distribution, distributor service capabilities, and other factors. Regional division in township and rural markets is generally based on the boundaries of townships and administrative villages, sometimes also referencing obvious natural environmental boundaries, such as rivers. IV. Distribution Channel Distribution (Shelf Placement)
  26. Treat the distribution rate of distribution channels as an important part of the distributor's (or second-tier wholesaler's) regional management responsibility.
  27. Actively penetrate competitors' distribution channels through distribution customers.
  28. Company business personnel actively improve distributors' customer development, management, and service capabilities.
  29. Guide and require distributors to strengthen (and if conditions allow, assign dedicated personnel) visits to lower-level customers, business contacts, customer development, etc., and provide guidance in actual work.
  30. Through market research, promotion flow monitoring, etc., clarify terminal distribution and actively guide distributors to distribute products to terminals.
  31. Reasonably use the company's promotion policies and product entry policies, with the support of company business personnel, to "point shoot" at terminals with large sales volumes, difficult product entry, or competitors' exclusive points.
  32. In township and rural markets (including rural areas), gradually cultivate consumers with consumption influence (such as leaders of township government functional departments, village heads), and strengthen customer relationship maintenance so that they can exert influence in improving the company's product coverage.
  33. Ensure product inventory for distribution customers:
  34. Establish and improve the customer emergency delivery (product transfer) mechanism.
  35. Monitor sales changes of distribution customers, scientifically set purchase cycles, and ensure inventory for normal sales. V. Market Price Stability Strictly control and severely crack down on cross-regional sales (channel stuffing) to ensure product sales order in township and rural markets. Contracts require distributors to implement product sales prices according to company regulations or guidance, and regularly check and supervise through market surveys. Treat distributor product sales price stability as an important part of distribution contracts and distributor performance evaluation. Use measures such as collecting breach of contract penalties and reward controls to ensure distributors distribute or directly sell company products at specified prices. Strictly supervise and control distributors' implementation of promotion policies according to company plans, and prevent unauthorized price reductions. When conditions allow, require distributors to provide detailed records of product distribution/direct sales flow, volume, and price execution. Actively collect information on group purchases or large-scale purchases in township and rural markets through various methods and channels, and provide discounts within company approval. Price stability for second-level distributor product sales: Require distributors to sign distribution agreements with lower-level customers according to company requirements or under company guidance and supervision. Sign tripartite agreements (company, distributor, second-tier wholesaler) to have the distributor control the supply, sales rewards, and price execution of second-tier, subject to company supervision. With company approval, distributors may collect a certain amount of deposit when signing agreements with second-tier. The company holds distributors responsible for price violations by second-tier. With company approval, distributors may use methods such as flat purchase and flat sale, and rebate control to constrain second-tier's purchasing and product sales (price) behavior. Price stability for terminal customer product sales Use packaging, product promotional posters with retail guide prices, etc. for guidance, without excessive requirements. Group purchases collected by terminals are sold under the guidance and support of distributors. Special note: Village-level markets are forced out, managed out, not imagined! As a unique model in China, the township and rural market is a proven large mineral deposit, but the reserves are scattered, difficult to mine, technically challenging, and costly. The start-up of township and rural markets will be a long process. The initial investment is like throwing a stone into the sea; it is inevitable that there will be no waves. Facing this "rural cake" with Chinese characteristics, the best strategy is to chew slowly and eat carefully. Only by starting from the basics and doing detailed and solid work can we prevent "coming in a hurry, leaving in a hurry"! --------------------------------------------

--------------------------------------------