A large number of sellers have transformed! Is there no future for selling goods?

  Is distribution gradually being abandoned by the times?

In the eyes of many people, distribution is not a very promising business model now.

About 10 years ago, the status of mass merchandising was not low. At that time, barbaric mass merchandising was common. Sellers relied on traffic dividends to sell hot-selling products on major e-commerce platforms with the standards of "fast, accurate, and correct". They could easily attract consumers with crude advertising. For those who did well, it was not uncommon to receive thousands of orders a day.

Most cross-border e-commerce companies started out by distributing goods , creating annual sales of hundreds of millions or even billions, and gave birth to super sellers with names like "Sakata Five Tigers" and "Hua Nan City Four Young Masters".

Time flies, and a decade has brought about tremendous changes! The industry is always in a state of constant change. A large number of cross-border companies have gradually discovered that distribution is no longer a profitable tool. In response to the rapidly changing external environment, they have started the road of transformation.

The distribution of goods is gradually replaced by high-quality goods, and even the reputation of distribution of goods is also declining. When it comes to the distribution of goods model, many bosses are dismissive, and remarks such as " those who went bankrupt on Amazon were all distribution of goods ", " distribution of goods doesn't work now " , and " distribution of goods has no future " are flying everywhere. Many workers also warn new operators as experienced people: when choosing a company, it is best to find a company that does high-quality goods, and try not to go to a distribution of goods, unless you want to repeat the work of putting products on the shelves every day...

The contempt chain popular in the cross-border circle shows that the boutique team > the boutique team > the general merchandising team > the random general merchandising team > the follow-up sales team . It can be seen that general merchandising is obviously despised. Is general merchandising being abandoned by the times? General merchandising sellers do not make any money at all ? General merchandising is not worth mentioning in front of boutique products? Is it a general trend for general merchandising sellers to switch to boutique products?

But is this really the case? With many questions in mind, the editor tried to enter the world of distributors and try his best to truly restore the "red and black" of the distribution model!

There is no future for wholesale goods? Many cross-border companies are turning to high-quality products!

From the initial distribution of goods to refined distribution and then to the current boutique model, Xiao Zhang (pseudonym), a veteran cross-border player, has gradually found a way to make money that suits him.

Like many people, Xiao Zhang joined the army of distributing goods at the beginning because he was attracted by the advantages of this model such as "low capital investment, low risk, no need to stockpile goods, and low trial and error costs". His colleagues kept reporting that they were receiving thousands of orders a day and making millions a year, which further boosted his confidence.

After getting started, Xiao Zhang found that the distribution model looks very simple on the surface, but it is actually very challenging. First of all, the labor cost is very high, and a large number of products need to be continuously uploaded every day to support a large number of SKUs. After sales increase, the FBM model also requires a large number of warehouse staff to ship small packages. When there are many and complicated SKUs, it is also a great test for procurement and supply chain. At the same time, distribution is prone to problems such as infringement and logistics performance.

I did make money at the beginning. When I was lucky, I could make money in a few weeks with a few hit products. But the things I had to deal with were very tedious. I had to deal with system misjudgments and complaints almost every day. With the development of the times, the distribution model has become less dependent on manpower, and has instead relied on programs and IT to automatically list products. Development and procurement can also be moved and ordered with one click. However, compared to boutique sellers, Xiao Zhang is still very busy every day, but his output is declining year by year, and he feels anxious.

Xiao Zhang clearly realized that the distribution model was gradually becoming unworkable, and it was difficult to continue making money solely by relying on traffic . The disadvantages of the distribution model, such as "short product life cycle, low product threshold, and simple and crude operation", would further drag down performance in the future.

"The distribution company has poor sedimentation, strong substitutability and no core competitiveness. This means that the experience of the distribution company can be easily copied by others. It is said that many well-known large distribution companies in Shenzhen have become product selection tools for company employees to work alone in the future." If he does not seek change, he will only be surpassed by more people, so Xiao Zhang began the transformation to fine distribution.

During the distribution period, Xiao Zhang basically put up whatever products he liked, with basically no regular pattern in product selection; during the fine distribution period, he would select products with a certain degree of precision, considering factors such as market competitiveness and price before posting the link for shipment.

In addition to the fine-scale strategy, the company also selected several products to try to make them into fine products. Different from the "general and comprehensive" business of general products , the fine product business focuses on "fine and beautiful".

At the beginning, the performance of Jingpu was actually much better than that of Jingpin. Later, as a large number of sellers entered the market and logistics and advertising costs soared, Jingpin began to catch up and its sales performance far exceeded that of Jingpu. Finally, after careful consideration, Xiao Zhang decided to actively eliminate the Jingpu strategy and determined the boutique route model. " The end point of every e-commerce platform is boutique , and general merchandising will be eliminated sooner or later . " Xiao Zhang believes that Jingpin has done a lot of market research in the early stage, and the products developed are more competitive. After the successful promotion of the products, the future profits will be more substantial.

Like Xiao Zhang, there are many sellers who have switched from general merchandising to boutique products. 2021 is an important time node . Many boutique sellers in domestic cross-border e-commerce have been greatly affected by the "account blocking" policy of the Amazon platform. They have a premonition that a fair and orderly boutique market is coming, and have begun to lay out their boutique businesses.

High-quality products are squeezing out the living space of general merchandise, making the operation of general merchandise more and more difficult year by year. Sellers generally believe that although it is possible to make a million or even more a year by general merchandise, it is not common. This requires many prerequisites, such as focusing on or being proficient in a fixed category, and then having the ability to integrate the supply chain . In short, general merchandise is now also a technical job!

Abandoned by the times and defeated by the market. Many small and medium-sized sellers of general goods have fallen silently, and some long-established cross-border sellers are also becoming increasingly bleak in the era of "intensive cultivation". Youkeshu, known as one of the "Four Young Masters of South China City", was deeply hit by the wave of Amazon's account bans, and its performance plummeted.

According to Youkeshu 's 2023 semi-annual report, the company achieved operating income of 235 million yuan during the reporting period, a year-on-year decrease of 44.40%; the net loss attributable to shareholders of the listed company was 59.2862 million yuan; the net loss attributable to shareholders of the listed company after deducting non-recurring gains and losses was 59.2829 million yuan. The basic loss per share was 0.1405 yuan/share.

In April this year , Youkeshu was labeled "ST" by the Shenzhen Stock Exchange. The reason was that the net profit before and after deducting non-recurring gains and losses in the last three fiscal years was negative, and the audit report for the most recent year showed that the company's ability to continue operations was uncertain.

In July this year , Youkeshu issued an announcement stating that due to the overdue repayment of the merger and acquisition loan from Shanghai Pudong Development Bank, Youkeshu Jiangsu High Court delivered the second-instance judgment (which was also the final judgment): Youkeshu will bear the payment obligations of the principal of 185 million yuan and interest, penalty interest, compound interest, etc.

In the past two years, almost all the news surrounding Youkeshu is negative. Not only has the once hot-selling product gradually fallen out of the first tier, it is now even mired in a quagmire.

There is a tree that is the epitome of survival for many bulk sellers.

Is the distribution of goods equivalent to "putting machines on the shelves"? Workers: I really dislike distribution companies

When people mention Youkeshu, in addition to thinking of labels such as "worrying profits, besieged by loan problems, and an uncertain future", cross-border people, especially workers, will also involuntarily think of this famous saying in the cross-border circle: Why come to Shenzhen if you don't want to work overtime ? You can be fired if you leave work before 10 o'clock ...

Overtime is one of the specific requirements of many distribution companies, including Youkeshu. It is understood that some companies will require employees to work overtime for 40 hours per month without overtime pay. If the overtime requirements are not met, performance may be affected.

Many cross-border workers do not hide their "disdain" for distribution companies. Listening to the workers' complaints, we can find that the reason is not just due to overtime. It is understood that many operators who have worked in distribution companies such as Youkeshu for a year basically do not know how to do anything, which is exactly the most complained area of ​​distribution workers.

Xiao Liu (pseudonym) once worked for a distribution company in the mainland. Its products covered multiple platforms such as eBay, Amazon, and Walmart. The company stipulated that each person had to develop 160 products per month. The company was in a state of internal competition, and overtime was inevitable. In addition, the leader was actually an outsider, so it was inevitable that he would "give blind orders"...

Xiao Li (pseudonym)'s first job in the cross-border circle was to distribute products on Amazon. He was doing endless product listings every day . He had to list several stores until the 8571 code appeared every week . He could only learn very little from distributing products. After a long time, he found that he could only add new products and could not learn anything more in-depth. The company also gradually fell behind in the process of development. The salary was getting lower and lower every month. Stores were closed one after another until the company closed down and the boss went bankrupt.

To summarize the views of these workers, distributing goods is equivalent to a machine that puts goods on shelves on an assembly line . It does not increase knowledge and makes people focus most of their energy on repetitive work, and they cannot devote more energy to researching products and customers!

It was precisely because he could not see the future that Xiao Wang (pseudonym) chose to quit his distribution job at the peak of his performance and went to a boutique company to settle down. It is understood that after graduating in 2018, Xiao Wang selected many popular products within 2 months of joining the company, and his monthly commission was as high as tens of thousands. However, he found that he knew nothing about slightly deeper issues such as advertising operations, except editing listings, putting products on the shelves to increase the product base, looking at accounts, using ERP , etc. He gradually realized that his current achievements were largely due to luck, which was not common, and operational strength was the confidence to gain a foothold in cross-border business, which was exactly what he lacked. So he resolutely resigned and only considered boutique companies when looking for a job. It didn't take long for him to successfully enter a boutique company. After comparison, he found that his original choice was extremely correct.

Xiao Wang believes that he can learn more from doing boutique products for a month than from doing mass merchandising for a year . "There is a big difference between boutique products and mass merchandising companies! Mass merchandising can actually make money, but for workers alone, mass merchandising has neither precise product selection nor refined operations, and from a long-term development perspective, there is little room for growth. If you want to make big money in this industry, you still have to rely on boutique operations to continuously optimize products." In detail, in mass merchandising companies, you can learn the basic concepts and backend operations of Amazon, but boutique products can learn Amazon's core technology, and the level of care and effort spent on products is also incomparable to mass merchandising, such as market research, packaging material preparation, product details page, advertising, promotion, keyword research, logistics docking, etc., the process of a product from 0 to 1, basically all of which can be touched, these are all valuable experience accumulation.

There are still many operators who want to switch from general merchandising to boutique operations, but not all operators are as lucky as Xiao Wang! As the cross-border market matures, general merchandising operators without boutique experience often experience the embarrassment of "transformation". Many people who have experienced it personally have found it very difficult to switch from general merchandising to boutique operations! Now most boutique companies do not want operators who only have general merchandising experience, and even if they do, they will keep their salaries very low.

Xiao Liu quit his distribution job and went to Shenzhen to look for a job. At first, he encountered many setbacks and regretted not going to a boutique company right after graduation. In the eyes of many boutique companies, his previous distribution experience was not worth mentioning at all. Distribution people were equivalent to Amazon rookies. Xiao Liu was either rejected for a job or his salary was infinitely reduced. In the end, he chose to go to a small company to open up new areas.

Yibai's net profit increased by 116.96%! Multiple sellers distribute high-quality goods in parallel

Branding is definitely the future development trend of cross-border e-commerce, which can be seen from the fact that many distribution companies have turned to high-quality products. Does this mean that distribution sellers do not make money ? Is the distribution model gradually being abandoned by the times?

Observations have revealed that at this stage, the days of many bulk sellers are not as difficult as rumored by the outside world. Instead, they are living a very comfortable life!

Many big sellers rely on the "sea of ​​goods strategy" to find hot products , successfully cash in on the gorgeous revenue data , and help the dream of listing. Big seller San Tai shares has already applied for the registration of public offering of stocks, and it is only waiting for the bell to be successfully listed. It is understood that San Tai currently has 830,000 SKUs on sale, with nearly 100 subcategories, and sales channels include more than 30 major global and regional e-commerce platforms.

“The sellers on the same floor have had bigger and bigger offices over the past two years. I don’t know how much money they have made.” A boutique seller revealed that many of his colleagues only do distribution, and it is not uncommon for them to receive hundreds or even thousands of orders a day.

In the view of many sellers who still insist on selling products in bulk, they currently do not have the genes to make high-quality products. High-quality products require greater investment in research and development, are difficult to develop, and require a higher level of operation. In comparison, the strategy of selling products in bulk is more suitable for them. It is not that the model of selling products in bulk is not profitable, but that some people cannot make money by selling products in bulk. Whether selling products in bulk can be done well depends mainly on each person's learning and thinking ability.

Regarding Amazon's distribution model, many different approaches have emerged.

For example, the independent station has multiple accounts to promote products, which is also called product /brand matrix. Specifically, when selling a certain product, it is promoted through multiple independent stations. Although the keywords and brand names are different, the products are actually the same; or multiple categories of products are promoted. Several listings are listed in each category. If a certain product is hot-selling, the listing of the entire category will be developed.

At present, many sellers who used to pursue high-quality products have switched to mass-marketing and have enjoyed a second spring in their careers. They believe that it is a big pitfall for novice sellers to pursue high-quality products from the beginning when their own abilities are insufficient. The mass-marketing route is the best . Mass- marketing is not without rules, but it is necessary to focus on a small category . As you go deeper into this category, you will accumulate more and more , and finally you will be able to convert it into stable profits .

According to the opinions of industry insiders, the existence of mass merchandising must have its rationality and value. Whether it is mass merchandising or boutique model, the model that suits you and can make money is the good model. Mass merchandising is to face the market horizontally, keenly perceive hot products and respond quickly; boutique is to create boutique vertically and build a deep brand. Different models can complement each other and learn from each other.

The dual-track parallel strategy of distributing high-quality products is being practiced by many sellers.

Yibai Network, a popular online store, is one of them. In the first half of 2023, Yibai Network's operating income reached 298,129.66 million yuan, a year-on-year increase of 52.11%; net profit was 24,346.27 million yuan, a year-on-year increase of 116.96%. It is understood that Yibai Network has 720 online stores on Amazon, 54 of which were newly added and 7 were closed during the period.

Compared with the general product business, Yibai's boutique business focuses on product selection and has initially formed four major product lines: cleaning appliances, home appliances, pet products, and lamps. The number of SKUs on sale in the boutique business is 376, and the sales unit price is relatively high at 441.13 yuan. Sales volume has achieved rapid growth in the first half of this year.

From the perspective of workers, the distribution of "shelf tools" that has been widely complained about is actually not as bad as rumored.

Weibo blogger "Perfect Operation Evolution" said that the first model he came into contact with was the lowest model in the cross-border contempt chain - distribution, or small parcel self-delivery distribution. At that time , starting from operations, 60-80 SKUs had to be put on the shelves every day , and at least 50,000 listings had been put on the shelves in two years . The accumulation of more than 50,000 listings in the distribution model has brought the biggest improvement to myself. In the future, when I see most products on Amazon, I can subconsciously decompose the composition of this product, analyze the hot-selling factors of the category in which this product belongs, and judge whether I have the ability to win this category with my current strength as quickly as possible , and then determine the subsequent single-handed model - the mainstream in the industry currently calls it "fine distribution" .

He believes that from the time he started distributing small packages in 2016 to the time he worked alone and figured out the "precision distribution" model in 2019, every step has been based on the current situation, and he has used the "martial arts skills" he could get to be at the top of the small category. When he grows to a certain level, the experience and knowledge he has accumulated will naturally prompt him to move to the next stage.

Coincidentally, another seller also said that he learned a lot from the distribution of goods; through a large number of distribution and product selection, and dealing with various infringement and violation information, he understood what are high-risk products, what are popular products, and how to edit copy and place categories to avoid violations, what kind of appeal method can best solve infringement problems, what products can be used for long-term profits, and how to share the high risks brought by popular products ... Even if I will take a more refined boutique operation path in the future , I will always be grateful for this distribution experience.

" There is no inherent superiority or inferiority in all operating models. The best one is the one that suits you, " said many industry insiders.