BCG的中国渠道战略报告

OpportunitiesforActioninConsumerMarketsWholesaleDistributionChangesforaWinningChinaStrategyWholesaleDistributionChangesforaWinningChinaStrategyHypermarkets,supermarkets,andconveniencestoresareblanketingChina—orsoitseems.GlobalplayersCarrefourandWal-Martareopeningnewstoresatanaggressivepace.LocalretailerLianhuahasamassedsome2,000newoutletsin16provinces.AndregionalchainHongqihasmorethan200supermarketsinSichuanprovincealone.Duringthepastfewyears,salesinthenewretailformatshavegrownmorethan50percentayear.Nevertheless,thismoderntradeaccountsforlessthan30percentofretailsalesinChina,anditservesonlyone-quarterofthe500mil-lionconsumerswholiveinornearChina’smorethan3,000citiesand20,000towns.Theseconsumers,whoarereachingthresholdspendinglevelsformanyproducts,representamarketwithhugegrowthpoten-tial.Andbecausemostofthemstillshopatmom-and-popmarketsandsmall,localdepartmentstores,tradi-tionaltradechannelswillremainasignificantpartoftheeconomyforatleastthenextdecade.YetonlyasmallfractionofWesternconsumer-goodscompaniesinChinahavefullyexploredtraditionaltradebeyondthelargestcities.Despitethegreatpotentialforprofits,mostglobalplayershavebeendiscouragedbythedifficultyofcontrollingdistribu-tioninthosechannels.Companiesthatareabletoclearthishurdlewillfindthattraditionaltradeoffersanimportantsourceofgrowth,withsuperioreco-nomicsanddecisivecompetitiveadvantage.Ofthevariousmethodsfordealingwiththedistributionchallenge,activemanagementofthewholesalechan-nel—anapproachthathasbeenunderleveragedbyglobalconsumer-goodscompanies—presentsanopportunitywellworthconsidering.WholesaleMay045/5/049:55AMPage3ApproachestoSalesandDistributioninChinaMostWesternconsumer-goodscompanieshaveem-bracedChina’smodern-tradechannel,andthey’vebroughttoitmanagementexperiencewithkeyac-countsinothercountries.Butoutsidethelargestcities,China’svast,heterogeneousmarketsmakethesalesanddistributionofconsumergoodsproblemat-ic.Theexpenseandresourcesrequiredforretainingfirmcontrolofsellingandpromotionalactivitiesacrossabroadgeographicareawithafragmentedretailstructureforcemostcompaniestochooseeitherfocusorbreadth.Forafewpremiumcategories,suchascosmeticsandimportedwines,thetradeoffiseasysincedemandisconcentratedinmajorcitiesamongaffluentcon-sumers.Butformostconsumerproducts—snacksandready-to-drinkbeverages,home-careandpersonal-careproducts,anddurables,suchastelevisionsetsandmicrowaveovens—atleasthalfofthedemandcomesfromthehighlyfragmentedtraditionalchan-nels.(SeeExhibit1.)Yeteveninthosecategories,mostglobalcompaniesinChinagiveupbroadcover-ageandpenetrationinfavorofcontrol.Usually,theychoosebetweentwotypesofsalesanddistributionmodels:thedirectmodelandthedistributormodel.Sometimestheycombinethetwo.Thedirectmodelfocusesonmanagingkeyaccountsandprovidesthemostassurancetomanufacturers,sincetheyremaininfullcontrolofthesalesforceandsellingactivities.Dependingonthecategoryandsizeofthebusiness,however,thedirectmodelisonlycost-effectivefortargetingmoderntradeinthetopcitiesinChina.WesterncompaniesinsmallcategoriesorWholesaleMay045/5/049:55AMPage4CategoryPersonalcareproductsDurablesHomecareproductsReady-to-drinkbeveragesSnacksExampleShampooTVsets,microwaveovensLaundrydetergentCarbonatedsoftdrinksRicecrackersPercentageofsalesthroughmoderntradechannels5030to35302515Percentageofsalesthroughtraditionaltradechannels5065to70707585SOURCE:BCGanalysis.Exhibit1.MostoftheDemandinChinaComesfromTraditionalTradewithmoremodestambitionsinChinatendtochoosethismodel.LargerglobalcompaniesinChinaoftendeploythedistributormodeltoservetraditionaltrade.AlthoughthismodelhasbeenquiteeffectiveinWesternmarkets,ithasnotyieldedthesameresultsinChina.Inmostdevelopedmarkets,distributorsareprofes-sional-servicescompaniesthatassumesellingandothervalue-addedactivitiesonbehalfofthemanufac-turer.InChina,however,mostdistributorsarepassiveandhavelittleexperienceinsalesorservice.(SeeExhibit2.)Forthisreason,manymanufacturershaveinvestedconsiderabletimeandmoneyinupgradingthecapabilitiesoftheirChinesedistributors—providingthemwithtraining(classesandtrips),tools(trucksandpersonalcomputers),andsalesresources(subsi-WholesaleMay045/5/049:55AMPage5dizedsalesreps,merchandisers,andpromoters).Butsincemostdistributorsrefusetoworkexclusivelywithonecompany,someofthetrainingandresourcesgiventothemalsobenefitsthecompetition.Othermanufacturersusetheirownsalesteamsandpromo-tionstogeneratedownstreamdemand.YetthathastheeffectofreducingChinesedistributorsto“boxmovers.”What’smore,itisextremelydifficulttopiecetogetheradistributornetworkforcoveringsmallercities—letalonetowns.Asaresult,thedistributormodelinChinaturnsouttobelesseffectiveandmoreexpen-sivethanmanufacturersanticipated.Notsurprisingly,somecompaniesthathavechosenthedistributormodelarenowrethinkingtheirdecision,whereasoth-ChinesedistributorsProvidevalue-addedactivitiesHavestrongsellingandpromotioncapabilitiesAreinterestedinlong-termrelationshipsHavelarge-scalebusinesses—$5millionto$10million—withbroadproductportfoliosHaveITcapabilities,suchaselectronicdatainterchange,toprovideup-to-datein