Entering the 21st century, the internet has taken over the world. The impact and erosion of the internet economy, especially e-commerce, on offline channels, particularly the distributor community, has been thorough and deep. Distributors, who were once invincible in the era of mass distribution, have become a vulnerable group overnight. Every move by the internet, even a glance, seems capable of instantly destroying the barriers that distributors have built over decades. Just like a droplet in Liu Cixin's "Three-Body Problem" can instantly crush any high-tech developed by Earth's civilization. Just as humanity needed to find a way out when the Trisolarans planned to migrate to Earth, when distributors are being battered by various B2B and sharing economy models, they will also seek their own way out. In recent years, the marketing world has discussed who will deliver a dimensionality reduction strike on distributors or who will cross-industry replace them. But don't forget, there are 1.746 million legal entities with wholesale qualifications. Such a huge group, when their original ecosystem is disrupted, will inevitably choose to find a way out, even to "snatch" others' rice bowls. As a group that rose from grassroots and prospered in rural areas, when facing operational crises or even survival crises, the energy unleashed by their tenacious vitality and extraordinary fighting spirit should not be underestimated. Survival is a competition. In any industry or profession, only by leveraging strengths and avoiding weaknesses can one laugh last in this elimination game. Whose rice bowls can distributors snatch? Based on changes and industry trends observed in the distributor system, we have made some assumptions and predictions to share with all distributor friends.

  1. Snatching the rice bowl of unattended retail Some may say, it's clearly unattended retail stores that are snatching distributors' business, so why claim distributors will snatch theirs in the future? First, manned and unmanned stores will inevitably compete in the future; this is open competition. Second, besides open competition, there is also covert struggle. The initial driving force behind unmanned stores will be third-party forces rising from enterprises and distributors, such as Binbin Box and EasyGo. By expanding aggressively, these third-party forces will inevitably squeeze distributors' living space. However, just as no manufacturer can set up exclusive stores entirely through direct operation, channel brand owners cannot independently bear all the risks of store operation. The best way to share operational risks is to recruit social capital for franchising, and distributors are the most qualified for this. At this point, distributors become investors or franchisees of unmanned stores. Furthermore, as unmanned store technology matures, distributors who have accumulated substantial capital will not be content with playing the supporting role of franchisee. Distributors who already control the channels of a province or a city are fully capable of creating regional unmanned retail store brands through technology outsourcing, becoming truly dominant portal distributors. At this time, the "XX Trading Company" established by distributors will no longer be just a name or symbol, but a channel brand that truly reaches consumers' minds. So, from this perspective, although unattended retail is snatching distributors' rice bowls, it is also the rise of unattended retail that accelerates the rise of channel brands. And the rise of channel brands is the best opportunity for merchants to win a round in the game between manufacturers and merchants. This is the best era for distributors to build their own brands.
  2. Snatching the rice bowl of property and real estate With the deepening of the internet, the proportion of online sales for standardized, homogeneous products will increase. In the future, most stores with sales functions will not be built in the best locations, with the most money, or as the most beautiful stores (except experience stores), but will focus on distribution functions. This greatly increases the warehousing capacity requirements for distributors. Can some distributors who are now forced to transform seize the opportunity to secure warehouse locations in remote or even remote areas before land prices heat up? In other words, set up warehouses in the cheapest locations to maximize output per square meter. In the future, distributors will no longer recruit salespeople or business personnel, but a large number of people with warehouse management experience. These people will be assigned positions based on brand or category, and earn commissions through efficient warehouse management. Only through the scheduling of warehouse operators can manufacturers' product distribution and delivery in regional markets minimize warehouse occupancy and backlog. In the future, distributors will no longer simply earn price differences, but through professional services, obtain the turnover benefits of products in the warehouse. Of course, the transformation of distributors into warehouse operators also benefits from the rise of channel brands. The more mature the product and the smaller the differentiation, the more mature the channel brand will be, and the weaker the product brand will become.
  3. Snatching the rice bowl of third-party service providers Around the distributor industry, many supporting industries have emerged, such as channel development, maintenance, and store event planning. These functions were originally assigned to distributors, but due to the rapid and chaotic growth of the distributor industry in the early stage, many distributors did not solidly complete these basic skills. This round of internet impact will force distributors to trace their roots. The value-added services that the distributor industry has always emphasized are actually the foundation for distributors to survive. From simple reselling to indispensable existence, this is a huge transformation. Today, some distributors' channel development capabilities, event planning capabilities, and rapid response service capabilities have degenerated to the point where they need third-party service companies to teach them hand by hand and mouth to mouth. Distributors who heavily rely on third parties will be largely eliminated in this wave. Distributors who replace or even squeeze out third-party service companies will experience a new round of growth. In the corporate structure of distributors, either more detailed service functional departments will appear, which will conduct independent accounting through internal settlement; or various third-party services in the form of team contracting will gradually emerge. In the future, they will not only undertake the brands operated by distributors themselves but also similar businesses of similar products. This is a higher level of distributor development and one of the signs of channel rise. Of course, some may ask, what will happen to those who once worked for third-party service companies? My view is that they will be recruited by forward-looking distributor companies and become the first wave of leaders in the organizational refinement of trading companies.
  4. Becoming competitors of logistics and express delivery In 2008, when predicting future channels, I believed that one of distributors' future competitors would be express delivery and logistics. The vehicle sales model we saw in the past is just the prototype of competition with express delivery and logistics, and using tricycles or public buses for delivery is only the lowest level of competition. In this battle for initiative, the competition for the last mile is the key to this fight. In the future, what can express delivery and logistics only earn? Either the branch delivery fee for individual standardized products or the trunk freight for large quantities of products. But for delivery services that need to be integrated with supporting services, only distributors can undertake them. Because it is obvious that delivery personnel wearing "XX Express" uniforms cannot bring consumers the same good feeling and experience as delivery personnel wearing "XX Exclusive" work clothes. At the same time, forward-looking regional distributors will incorporate their fleets into the unified warehousing and distribution system of warehouse operators, becoming a part of shared tools. Although the implementation of unified warehousing and distribution is not satisfactory at present, with the accumulation of big data and the maturity of intelligent algorithms, the advantages of unified warehousing and distribution will definitely be maximized. Therefore, to take the initiative in the future, distributors must seize the key position of the last mile in express delivery and logistics to ensure they are not eliminated in this reshuffle. After all, the rise of channel brands must penetrate to the nerve endings that contact consumers to deeply bury the word "brand" in consumers' minds. The 3rd (CFIC) China FMCG + Internet Conference will be held in Chongqing in November 2017. The conference will closely focus on the theme "New Forces, New Ecology" and invite 1000+ distributors, 500+ brand owners, 200+ B2B platform founders, and 100+ investment and financing institutions to jointly explore a new chapter of cross-industry integration! Click the link below to review the highlights of the 1st and 2nd FMCG + Internet Conferences: 2016 "FMCG + Internet" Summit Forum -END-