Click 'Read Original' for details. What kind of group are Chinese dealers?

It's a bit much to say they harbor filth, but it's apt to say they are a mix of dragons and snakes. Those who don't follow rules or play by the book often resort to bullying and violence. A colleague of mine was beaten bloody and suffered a comminuted fracture of the radius over a dealer termination more than a decade ago; to this day, three steel pins remain in his body. Another colleague was beaten so badly by a dealer over a stocking dispute that he lost teeth and had bumps all over his head, and he still dares not return to that place.

The highest form of manufacturer-dealer conflict is termination. Once it comes to settling accounts with each other, the dealer who once called you daily for drinks and meals, or invited you to bars and KTV, will no longer be warm and gentle.

How to Avoid Creating Wrongful Cases? I once managed over 10,000 dealers, and with a monthly termination rate of about 5%, my hand trembled when approving these requests—that meant hundreds of dealers parting ways with the company each month! Sitting at headquarters, you have no way to confirm whether a customer should be terminated or not, or whether the process should be approved or not.

Later, to comfort myself, I added a customer termination report form, requiring regional staff to submit it along with the termination request. But I found it was of little use; if a salesperson wants to cut off a dealer, you can have a hundred thousand reasons to question it, and they'll have a hundred thousand and one reasons to justify it.

If this were a deadlock, the Chinese dealer community wouldn't have grown to its current scale. Every knot has a solution. In practice, I found two effective methods:

One is to delay. When a regional salesperson submits a termination request, don't rush to approve it. Wait a bit and let the dust settle. Many salespeople haven't thought it through clearly and are stuck in a simple either/or choice.

Many salespeople lack the courage to face headquarters' questions and inquiries, so after submitting the request, they wait to see headquarters' stance. For those processes where termination is optional, over time, the salesperson will think it through and voluntarily withdraw the request.

The second is to directly call and verify. When a request comes in, the supervisor will directly call the dealer being terminated to confirm their awareness, including the termination matter, reasons, and the dealer's stance. If the dealer has indeed given up or there are natural reasons like store changes, the process can be completed quickly. But if there's any discrepancy with what the salesperson reported, I either use the first method or directly reject the request.

Three Principles for Terminating Dealers

1. If you can avoid termination, avoid it. Many salespeople think that when adjusting regional markets, they must remove old customers to allow new ones to grow better. Of course, often they are also bound by promises to new dealers to clean up unfinished markets.

If a dealer fails to meet targets or sales, the salesperson bears some responsibility. Before deciding to terminate a dealer, ask yourself: Will this market definitely be better after this dealer is removed?

2. Even if you must terminate, do it gradually. In HR management, there's a concept called 'slow in, fast out.' What does it mean? When someone enters a company, take time to evaluate them; don't rush to bring them in. If you decide to fire someone, make them leave as quickly as possible.

Many people apply this theory to dealer management, treating dealers like employees, but forgetting that dealers are not employees. Dealers have inventory, capital investment, and network operations. If you cut them off without warning, even a deity would get angry. Unless the market absolutely requires it, allowing time for rectification, inventory clearance, and follow-up cleanup will yield better results with goodwill.

3. Even when terminating gradually, use proper methods. What's the harshest tactic salespeople use to terminate dealers?

Cutting off supply, and doing so without explanation.

That's directly hitting their lifeline and forcing them to rebel. Some dealers are unreasonable, but most are legitimate businesspeople. If you're going to terminate someone, at least tell them: 'Mr. Zhao, I have no grudge against you, but you keep failing to meet targets, and the company is putting pressure on me. Now we're in a market adjustment period. You're temporarily removed from our core customer list, and I won't impose sales targets on you, but all market support will also stop! As long as you don't engage in cross-region selling or price undercutting, we'll still supply you normally. But if we verify you're doing those, the company will blacklist you! That's all I can do for you!'

For many non-exclusive businesses, as long as dealers follow market order, they don't necessarily need to be cut off. Downgrading and adjusting support levels effectively allow the dealer to gradually fade away without igniting conflict in the short term.

What If You Encounter a Troublemaker? Headquarters staff handle such people relatively easily. The company operates nationwide and doesn't rely on any single market. If you encounter such a rogue, you can choose to put that market on hold. If they engage in cross-region selling, issue a notice nationwide, especially to surrounding areas, stating that anyone supplying goods to XX dealer without authorization will be severely punished.

Dealers also need to make a living. They might cause trouble for ten days or half a month, or even two to three months, but how can they sustain themselves long-term by undercutting prices and cross-region selling? If they keep it up for six months or a year, they'll exhaust themselves; few dealers can endure that long. Once the dealer calms down and the market stabilizes, the manufacturer can then focus on the market again—it's not too late.

Regional salespeople face pain because they have only their own small territory; if they don't produce results for six months, they might be done for. At this point, two methods can be tried:

One is to find a dealer with stronger local connections to take over. This is essentially fighting fire with fire, but it raises two issues: Is there a dealer willing to step into this mess? And if the new dealer also has problems, what then?

The second is to find a dealer with government connections. Local bullies may not fear 'mafia bosses,' but they usually steer clear of those with official backing. And having a dealer with government connections offers unique advantages in the building materials and home furnishing industry.

Some might say, 'What if I can't find a dealer with government connections and still want to get rid of the original one?'

My answer: 'Then you're out of luck.' As always, in sales, nothing is absolutely necessary; if it is, it's a matter of 'man proposes, God disposes.' When forced to choose between two difficult options, there's no choice at all.

From August 22-24, the '2018 China Digital Innovation Conference (2018FDIC)' will be held in Shanghai, hosted by the China FMCG Industry Association and organized by New Distribution, under the theme 'Finding New Engines for Growth.'

The three-day conference will focus on two main themes—marketing and supply chain—with six parallel forums on brands, channels, communication, B2B, same-city logistics, and innovative retail. We will invite industry experts, CEOs, and senior brand executives to deeply interpret the trends and drivers of digital transformation in the FMCG industry.

We will invite over 500 senior executives from FMCG companies, 200+ CEOs from B2B industries, and 1,000+ major FMCG dealers to gather and discuss how the FMCG industry can use digital tools to achieve renewed rapid growth in the digital era. This conference will build a bridge for brand owners, dealers, retail enterprises, and marketing agencies, helping FMCG manufacturers obtain the latest information, understand best practices, and master more transformation skills.

Planned Participating Companies

Conference Time August 22-24, 2018

Conference Venue Shanghai Baohua Marriott Hotel

Conference Agenda August 22: Full-day check-in Afternoon 14:00-17:30: Parallel forum on dealer same-city logistics Evening 18:30-21:00: New Distribution Night Gala Dinner August 23: Theme: Marketing Digital Innovation Morning 9:00-12:00: Main forum on marketing digital innovation Afternoon 14:00-17:30: Parallel forums on brand, channel, and communication August 24: Theme: Digital Upgrade of FMCG Supply Chain Full day: FMCG Supply Chain Conference

Registration Registration is now open. Long-press the QR code below or click 'Read Original' to register. Limited-time group discount prices are available!

Registration Consultation Ticket inquiries: Media cooperation inquiries:

Highlights of Previous New Distribution Conferences Click the links below to review the highlights of the 1st, 2nd, 3rd, and 4th FMCG + Internet Conferences:

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