How Can Product Agents Survive In A Meager Profit Era?

With the development of society and the intensification of competition, China's market environment is undergoing tremendous changes. As an important force in China's commercial circulation, the agents group is also facing increasing crisis of survival and pressure. Among them, the greatest impact on them is the coming of the meager profit era.
Many agents are in constant regret during the course of operation. Regional market terminals have undergone tremendous changes, competition is becoming more and more intense, and the market threshold is getting higher and higher. In the past, the good days of sitting at home and doing business are gone forever; the market is becoming more and more difficult to expand, and the payment of goods is more and more difficult to collect. Various entry fees, advertising fees and sponsorship fees are multifarious. The operating costs are increasing year by year, the number of personnel is increasing, the number of transportation vehicles is increasing, but the profits are less and less each day.
An air conditioner agent in Guangdong has been doing business for seven or eight years, and has always been the boss of this district, with abundant funds, strong warehousing and transportation capabilities and a good network foundation. But in the past two years, manufacturers have begun to engage in regional responsibility system. The area is getting smaller and smaller. The county has set up 10 dealers in size and size. Although the brand in the region has a good market base and large sales volume, each group has to compete for the price of the two batch of business and terminal sales. The original set of air conditioners can earn more than 3000 yuan, and now it can earn 100 yuan. It is very good now that the market order is in chaos, and the channel has no profit, and people have no confidence.
The era of meager profit has brought great survival crisis and business pressure to agents, prompting agents to change their costumes and adjust their business strategy to adapt to the current situation. Generally speaking, the survival of agents in the era of meager profits is essentially an open source and a throttling way to enhance profitability.
Below, the author will elaborate on the survival of agents in the era of meager profits from three aspects: consolidating the internal strength, deepening the regional market and expanding the channels and expanding forces.
Changing ideas and consolidating their own strength
In the era of meager profit, the most important thing for agents is to change their concepts if they want to continue to survive and develop. When the market environment changes dramatically, from the era of profiteering to the era of meager profits, agents need to have a sense of crisis. Only by recognizing their own shortcomings and situations can agents adjust their positioning in time and find a new way suitable for the current situation through continuous exploration. At this time, agents must be good at changing colors, changing their traditional customs or stereotypes, or even breaking the traditional business models.
Therefore, in the past, when agents saw others making money, they became jealous, and began to cross the area and run the goods at low prices. In order to get year-end rebates, compete for customers, drive the sale of miscellaneous products, or even pay the price to the customers in the non responsible areas, they had to compete at low prices, regardless of the manufacturer's policy and the normal price difference system in the region. In order to disrupt the entire market order for their temporary profits, such behavior was no longer desirable. Agents must learn to give up this traditional practice. Otherwise, the "win-win" situation of the manufacturers and the opportunity for the agents to survive and develop will be empty talk.
Second, reduce operating costs. The impact of reducing operating costs on agents is obvious. In the era of profiteering, agents can make a lot of money and make money. But in the era of meager profits, agents must learn to calculate carefully and calculate their input to output ratio in detail. By implementing scientific and institutionalized management, they must keep away from traditional and backward marketing modes as early as possible, avoid unnecessary losses and reduce their operating costs. The calculation of a sugar and wine agent found that the output and output ratio of some of the distributors and terminal retailers was too low to even make ends meet. Therefore, the agent decisively cut off the offline and turned to develop some new and powerful offline distributors.
Thirdly, enhance awareness of risk prevention. Interest and risk are always proportional to some irresponsible brands. In order to win the "heart of agents", some irresponsible brands set up agents for agents. They can stimulate agents by promising high rebates and incentives, and attract agents to join. Once they get the money, they will go away with their clap. Therefore, in the era of meager profits, agents must learn how many eyes to recognize the true nature of agent brands and offline distributors, while paying attention to grasping their own cash flow and avoiding the tragic fate of their bankruptcy due to the failure of cash flow.
Finally, we should improve our internal management and sales level. Many agents turned out to be operators in the wholesale market. They were poor in quality, poor in management, and backward in management. They could only be said to be heroes in the current situation. But the peak period of the wholesale market has become a thing of the past. Agents must change their functions in time, change their business into a business operator, and establish a company's management system. From the mere pursuit of profits to profits and scale, they should gradually develop their marketing team, improve their management and sales level, and enhance their ability to resist risks.
Do a good job and be a good snake.
The art of war of Sun Tzu says, "know yourself, know each other, fight a hundred battles, do not know what you know and win." every battle will be defeated. This sentence is also very applicable in the field of marketing. In the era of meager profits, the key to the survival of agents is to foster strengths and circumvent weaknesses and make deep efforts in the most familiar and most competitive regional markets.
Agents infiltrate into the retail sector, which is one way out for agents and a trend of differentiation among agents. At present, the boundaries between agency and retail are gradually weakening, and agents can fully use their own advantages to enter the retail industry. To understand the needs of retailers and consumers directly through expanding the retail sector, it helps to organize the supply of goods scientifically, provide services and expand sales. The extension of agents to the retail sector can also achieve the internalization of wholesale and retail transactions, thereby saving transaction costs. For smaller agents, this is a better way to get out of trouble. In fact, this practice is widely adopted by many agents in many areas.
Sticking to the local snake, agents must first gain a larger market share in their surrounding sites and extend their tentacles to the whole region without leaving a blank space for competitors. The agent must ensure that his home can be consolidated and protected so that he can go out of his home and rush to the outside world. Therefore, agents must seriously consider their regional strategy, including whether the local outlets (including warehousing) are maximizing the distribution of goods, whether the manufacturers give maximum support to them, whether the brands they operate are very advantageous, whether they are simple operation or expanding capital investment, whether there is sufficient liquidity in the rear area, and how high the market share is. The direct control ability of agents to the terminal market will become a necessary bargaining chip between agents and manufacturers. Agents must build their own terminal networks, penetrate deeply into their regional markets and infiltrate downstream retailers.
Secondly, it is very important to strengthen cooperation with emerging logistics such as chains and supermarkets in the regional market. Supermarkets are becoming increasingly important retail formats. Whether agents can have their stable and strong customer network, good customer relationship and strong business in the supermarket channel will have a profound impact on the future sales growth of agents. In addition, agents are more agents of some brands, bundled into supermarkets and other hypermarkets, can greatly reduce operating costs.
Third, seek downstream partners to maintain existing marketing channels. Through negotiations, agent transactions enter or penetrate into the broad channels of downstream distributors and retailers, and exert themselves to spread their products or forces to every corner of downstream business. In addition, agents can also be bundled by cigarette and liquor dealers, beverage dealers and wine dealers, or offer preferential loans to pick up the goods. They require the downstream businesses to pay first and then take delivery of goods, giving a certain interest or rebate, inducing them to take the initiative to purchase payments, and bring downstream businesses into their own sphere of influence, so that those manufacturers who want to cooperate directly with distributors will be taboo.
Secondly, we should improve relations with manufacturers and strengthen cooperation with strong brands or dominant brands. In the market, only joint manufacturers can guide consumption and create consumption, win consumers, and finally win the market. At the same time, agents must learn to protect themselves.
Finally, while preserving downstream distributors and terminal retailers, they can expand their influence and practical control by providing various support and training, including joining trade associations, making use of the strength of the association and local government to maximize the monopoly power of the "local snake", and be a good snake in the regional market. At that time, foreign strong dragons, including manufacturers and large retail giants, could not help themselves.
Expanding force to strive for "strong dragon" in business field
"Meager profit" is an environmental phenomenon. Instead of complaining about it, it is better to embrace it. Agents should be keen to grasp the dynamic trend, come up with a new marketing mode, and turn the crisis into a turning point. It is not enough for an agent to simply maintain its own territory. Because the market competition is becoming more and more intense, the strong foreign powers are eyeing it. If agents want to gain opportunities for survival and development in the era of meager profits, they must try their best to expand their influence and strive to become a "strong dragon" in the commercial field.
To this end, agents can make efforts in the following areas:
First, attack the two or three tier market and the rural market. China's business is coming out with legs. In the past, many manufacturers took the big cities as the target market of the key development, and put most of the resources into the big city market. However, with the coming of the meager profit era, the distribution environment of big cities is deteriorating. Agents can shift the focus of work to the two or three tier cities and the vast rural market, so that although the operation cost will increase, the operation cost is relatively low, especially in the market dominated by wholesale and retail, the success rate of small scale operation to start the market and maintain the market will be higher. Second, expand to the surrounding areas. Agents can not be confined to their own cities, nor can they expand their peripheral markets to find a few large families. Agents should seek local partners to make regular downline distributors and help themselves manage the market; their own business personnel must form a fixed visit to the market; they should be very familiar with the key customers of various channels in the region; assist the offline distributors to manage the market and master the end. Since most manufacturers do not carry out deep distribution in all two or three level markets and rural markets, they must also rely on agents. Therefore, agents can get more support from manufacturers. Third, we should set up supermarkets or chain stores through the integration of people. Because of the increasing market share of supermarkets in China, the development of supermarket formats has knocked out a considerable proportion of wholesale and retail stores. It is not necessary for manufacturers to retain agents and directly aim at terminals. Agents can act as agents and develop regional wholesale companies and their retail chain stores across the country or region through their own investment or other means of cooperation. They can smoothly transfer and develop their own experience, capital and channel advantages in wholesale.
For example, the Shenzhou United supermarket, which was established recently, was announced by the supermarket that the business was closed down, and 40 agents (dealers) established a joint stock in order to avoid greater losses, resolve weaknesses and reshape advantages in Shanxi.
What's more, agents can buy or hold large stores in bulk, as larger businesses need capital as competition intensifies.