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Why Is It Increasingly Hard for FMCG Distributors to Make Money Despite Their Hard Work?
A financial journalist's encounter with a beer distributor who personally delivers goods highlights the grueling reality of FMCG distribution. The article analyzes why distributors are working harder yet earning less, and offers strategic paths for future growth, including brand operation, terminal refinement, digital capabilities, and premium product focus.
陈思廷90% of Distributors Will Be Eliminated, the Remaining 10% Will Embrace a Major Industry Opportunity!
In the past period, I visited some distributors. With declining demand and recurring pandemic outbreaks, everyone genuinely feels that business is tough. However, these distributors' businesses not only remained unaffected but also continued to grow, with some even achieving annual growth of tens of millions in an ordinary prefecture-level city. Growing against the trend is no easy feat! Although they all grew, the reasons differ. After in-depth understanding, we found there is much to uncover. We say that results are important, but the process of achieving results is more important; growth is important, but knowing the type of growth you have is even more important!
任文青AndyEmpowering Distributors | Expanding Coverage, Strengthening Sales, and Growing Business!
The incremental business based on demographic dividends in the FMCG market has completely ended, replaced by stock business, which implies a zero-sum game among market players. For FMCG giants, stock business tests not only their own capabilities but also their external partners, especially distributors at the frontline. Therefore, in recent years, many leading FMCG companies have been discussing empowering distributors, hoping to enhance their operational capabilities, reduce costs, and increase efficiency to achieve growth against the trend. Based on New Distribution's practical experience and industry cases, this article discusses how FMCG manufacturers should correctly empower distributors.
袁来2023 Budget: A Few Suggestions on Regional Market Expenses
In October, most FMCG companies have started their annual budgeting. This article offers several reminders on expense budgeting to help companies avoid repeating the mistakes of the past year.
高级研究员 海游A 5-Yuan Bottle of Oriental Leaf Makes Small Shop Owners in China Smile
Unsweetened tea is selling increasingly well. Shu Min, a distributor for Nongfu Spring, recalls that Oriental Leaf had poor sales in 2016, but after a free full-bottle tasting at a local supermarket, it attracted repeat customers. This year, sales in his area exceeded 12 million bottles, with many small shops selling over 200 cases. He says Oriental Leaf is magical—many find it unpleasant at first sip, but after finishing a bottle, they can't quit. His key promotion tactic has been giving away full bottles.
白芨Is Building a Self-Owned B2b Platform for Distributors a Good Way to Achieve Large-Scale Terminal Coverage?
Recently, due to company projects, I had in-depth discussions with several distributors about the distribution business, and the feedback was that most distributors are finding it hard to do business. First, in the past, with brand dividends, distributors could quickly open up channels relying on brand influence; without brands, channel advantages are greatly affected. Under this model, distributors mostly serve brands, execute according to brand operating models, and have weak control over terminal outlets; once brand momentum declines, their business follows. Second, in the past, with China's population dividend, distributors could thrive by relying on natural market growth and earning price differences, but as the demographic dividend fades, the stock market inevitably intensifies competition, making business harder.
周群New Distribution's Ten Judgments on FMCG B2B in 2022
In the past two months, the author visited regional B2B platforms and learned about their development this year. Despite the pandemic's impact, B2B has seen high growth and significant profitability, proving it as a crucial distribution channel. The market space vacated by JD and Alibaba has allowed many regional B2Bs to grow rapidly.
赵波How Brand Owners Can Accurately Obtain Distributor Inventory: The Last Approach Holds Promise
Accurately obtaining distributor inventory is crucial for brand owners. If distributor inventory is too high, they cannot purchase from the brand owner, which not only affects the brand owner's normal sales rhythm but also seriously impacts the distributor's survival. Therefore, brand owners want to understand distributor inventory turnover to take necessary measures in advance to accelerate channel inventory turnover. However, uncontrollable factors on the distributor side may prevent brand owners from effectively obtaining inventory data, making accurate acquisition a thorny problem. To solve this, we visited over a hundred brand owners and distributors and summarized three common methods currently used.
助力客户成功Why Do Few Traditional Offline Distributors Succeed in E-commerce?
Many distributor partners often tell me that e-commerce is difficult and challenging. Many have already achieved great success in traditional offline channels, with annual sales exceeding 300 million, 500 million, or even 1 billion yuan, proving their strength and capability. Yet, despite their continuous learning, experimentation, and operation, they still struggle to break through sales bottlenecks, operational sticking points, and profit black holes. Why? There are many differences between online and offline, which traditional offline distributors need to consider and self-reflect on before venturing into e-commerce.
许翔 Ryan XuWhy Have Some Distributors Become 'Hopeless Cases'?
As the FMCG market enters a new era of competition, the traditional 4Ps of marketing have undergone profound changes. As key players in the channel, distributors' roles and positions are also fundamentally shifting. In recent years, Nongfu Spring has proposed 'strategic distributors,' and Snow Beer has also advocated building a 'customer system with Snow characteristics.' In fact, more and more manufacturers are clearly stating their intention to 'grow and strengthen distributors.' Reversing the fate of being flattened by manufacturers and 'revolutionized' by e-commerce in recent years, FMCG distributors are now facing new development opportunities. However, beneath these opportunities, we must also confront a stark and cruel reality: even with strong support from excellent brands, many distributors still seem to be 'hopeless cases,' neither growing nor strengthening. Why is this?
陈思廷Instant Retail Heats Up: How Can Distributors Catch the O2O Home Delivery Wave?
Since the start of the O2O era in 2014, O2O home delivery has become a key driver of new retail channel revolution. Accelerated by the pandemic, it has grown into a new consumption scenario and a trend optimizing consumer experience. On July 27, the China Chain Store & Franchise Association (CCFA), along with Dada Group and JD's Consumer and Industry Development Research Institute, released a white paper on instant retail open platform models, indicating that instant retail, a key part of O2O home delivery, is set to exceed one trillion yuan by 2025, reaching 1.2 trillion yuan. This article uses three key questions—What, Why, and How—to guide distributors on leveraging O2O for growth.
李文君WendyDo Traditional Distributors Still Have a Chance in Online E-commerce?
A recent Nielsen report shows that offline retail accounts for 60% of China's FMCG retail channels, while online channels are growing. As offline growth stagnates, many traditional distributors are turning to e-commerce for new growth. However, success requires overcoming mindset shifts, building professional teams, and mastering product selection and pricing strategies.
周群Low-temperature Fresh-cut 'Shu Xiaohuang': Innovating the Potato Snack Category
Despite the pandemic hindering the foodservice industry, leisure snacks have emerged as a new wave of consumption. With the rapid development of China's e-commerce platforms, consumer demand is trending toward quality, health, and personalization, prompting snack brands to enrich their offerings and accelerate health-oriented development. For example, French fries: most people think of KFC or McDonald's fried fries, high in oil and calories, expensive, yet enduring in China for 30 years due to their addictive nature. Mai...
沙华The Evolution of FMCG Offline Channel Coverage
In the FMCG industry, channel dominance has always been a strategic priority for manufacturers. Almost every successful company has a unique channel coverage model, such as Nongfu Spring's exclusive distributor model, Jinmailang's four-in-one partnership, Tsingtao Beer's two-tier distribution, and Coca-Cola's 101 model. This article reviews the history of China's FMCG offline channel coverage evolution.
高级研究员 海游After Three Years of Losses, Why Do Traditional Distributors Still Abandon Supermarket Business and Fully Shift to Local B2b?
Starting as an agent for Yili in 2011, Yu Xiuwei has been in the FMCG distribution industry for over a decade, during which he tried cross-regional operations, O2O, and multi-category, multi-brand management. At the end of 2019, he launched his own B2b platform. Initially, he only wanted to use system tools to help his team manage multiple brands, but as more small stores chose to place orders independently on the platform, he decided to give up the supermarket business and focus on building a supply chain platform that serves local small stores. After nearly three years of operation, he has developed deeper thoughts on B2b.
任文青AndyHow a Traditional Distributor Achieved Break-Even in Six Months with B2B?
A distributor who grew annual sales from over 100 million RMB in 2013 to 300 million last year shares her experience building a B2B platform. By preparing thoroughly, launching in four months, and operating for about six months, she achieved break-even with online sales accounting for 10% of total revenue.
任文青AndyThe New E-commerce Ecosystem: Should Distributors Enter Douyin E-commerce?
Recently, many distributors have asked New Distribution whether they should enter Douyin e-commerce live streaming and invest in short videos. Amid repeated pandemic outbreaks and sluggish business, they wonder if they should seek online growth. This article explores the phenomenon and trend of e-commerce migration, the logic of interest-based e-commerce, and provides insights on product selection and scenario development, based on an interview with Gu Xiangshuai, head of brand e-commerce at Mingzhi Huatong.
田静The 'Resilient' Distributor: Covering 13,000+ KTV and Other Special Channels, Redoubling Efforts in Local Community Group Buying Amid the Pandemic
This article profiles Shanghai Huanyu Yigou, a distributor specializing in special channels like KTV, cinemas, and bars, covering over 13,000 stores. Despite the pandemic's severe impact, the company has shown resilience by pivoting to community group buying, leveraging its supply chain strengths and innovative strategies.
周群Tongue Hero closes stores in multiple cities, Weizhixiang's single-store annual gross profit is 6,820 yuan, who exactly is eating prepared dishes?
Recently, Lu Zhengyao's prepared dish brand Tongue Hero has seen closures in multiple stores across several cities, drawing attention. Earlier, a franchisee revealed that after four months of operation, they hadn't even earned back their electricity costs, and many franchisees said current store repurchase rates are low, with only 9.9 yuan products selling well. Similarly, someone calculated for the C-end prepared dish brand and listed company Weizhixiang: its 2021 annual report shows 1,319 franchise stores contributed 346 million yuan in revenue, averaging 262,300 yuan per store annually, with an average gross margin of 26.01%, resulting in an annual gross profit of only 6,820 yuan per store.
焦逸梦New Distribution's Ten Judgments on FMCG B2B in 2022
01 After JD and Alibaba educated the market, the vacated market space has led to rapid growth for many regional B2B platforms this year. Recently visiting Pinpianyi, Xu Yi told New Distribution that they expect to reach about 23 billion yuan in 2022; Yijiupi's scale is still around 10 billion, and it is said that Lingshoutong has fallen below 10 billion; several larger B2B platforms in East China such as Caihua Commerce, Zhongshang Huimin, Kuailai Zhanggui, and Wanquan Supei are currently at 2-3 billion; regional players like Jiabin Yunshi and Weiran Jinhe have exceeded 1 billion; single-city, single-warehouse operations like Rongcheng Yigou, Wuhan Huxiaosheng, and Luoyang Hecai are mostly in the 100-300 million range. This is only a part; many local B2B platforms have seen significant growth in both speed and single-warehouse scale. Although JD and Alibaba are no longer the leading players, their exit has in a sense freed up the ecological niche, making the industry more prosperous. And the next decade will be even better.
赵波Why Isn't Your Product Selling? A Consumer-Centric Perspective
This article explains why products fail to sell by examining consumer behavior through the Fogg Behavior Model and emphasizing the importance of understanding consumer needs. It advises marketers to view products from the consumer's perspective, focusing on motivation, ability, and triggers, and to conduct deep consumer insights to uncover real demands.
高级研究员 海游Genki Forest Goes to the Countryside: Who's Crying?
Genki Forest is expanding into lower-tier markets, posing a potential threat to local beverage brands. However, local brands may not need to worry as consumers in these markets are tolerant of multiple brands, and some regional brands are successfully going national by leveraging nostalgia and innovation.
市场风向标FMCG Manufacturers: This Mid-Autumn Festival Should Be Celebrated 'Rationally'!
With the Mid-Autumn Festival approaching, market sentiment is weak, and channel partners are reluctant to stock up. This article offers rational advice for FMCG manufacturers and distributors, emphasizing respect for objective facts, scientific inventory pressure under channel digitalization, and lessons for holiday marketing.
高级研究员 海游How Manufacturers and Distributors Can Jointly Build Digital Marketing Synergy?
An experienced beverage distributor, facing declining sales and rising costs, receives a visit from a manufacturer's sales director who identifies specific market issues and proposes digital solutions. They agree to collaborate on a pilot project to leverage digital tools and third-party platforms to enhance marketing synergy and competitiveness.
邢仁宝