How can wholesaler maintain its competitive edge in keen market competition? Sun Xiaoyan, manager of Chengdu-based Little Swallow Toy Trading has her know-how. “As a wholesaler, I must seek bestsellers-to-be in market and prepare the stock. By this way, we can meet all demand of clients. ”
Hehuachi wholesales market is the largest wholesales location in Chengdu, Sichuan. In the passing Pig Year in Chinese lunar calendar, Sun harvested good fruit on sales of Transformers and yoyos with her acute observation on market.
Abundant product mix
Sun began her toy business at 1997. Engaged in the business for over 10 years, Sun has not only accumulated rich marketing experience, but also an extensive market network in Chengdu area. Products Little Swallow deals with can be distributed to the whole market rapidly. Lots of markers are happy to make supply to her. TOY INDUSTRY is told that, Little Swallow sticks to work with good faith is the solid foundation for cooperation.
There are over 40 units that are involved in the business of toy in Hehuachi Wholesales Market. Little Swallow has abundant product mix, displaying a dozen of brands and hundreds of kind of toys on its shelves. “Different with craft brothers in southern coastal cities, toy wholesalers in Chengdu must enrich their product mix. So clients in smaller cities can be attracted and maintain relationship with wholesalers,” Sun tells TOY INDUSTRY.
In fact, some of Sun’s friends in southern city are rather busy though they only distribute one or two brands.
This difference, Sun attributes to the small range of Chengdu wholesales covers. Although Chengdu has large consumption on toys, products are only distributed to small amount of places like Xizang and Kunming of Yunnan. Generally speaking, Chengdu’s wholesales aims at local market, especially countryside. Therefore, retailers can only cater for consumers’ demand by rich product mix.
How to select bestsellers out of hundreds of thousands of toys in China? Sun reviews her know-how to TOY INDUSTRY--keep an eye on animation series on costal TV station. “Animation series shown on TV stations of costal cities can always arouse a sensation of related products,” Sun notes.
For instance, Transformers and Super Blade is typical example last year.
Certainly, this is not enough. Sun keeps in close touch with craft brothers throughout the country, so she can receive latest information when there is any change in various markets. It facilitates her prompt program of making stock according to actual status. Therefore, what Little Swallow sells are all “substantial products” that have good market feedback. By this means, the company demonstrates its unique operation character.
A saying prevails in toy industry. Dominate contemporary business is to be dominated by department stores and supermarkets, which are key sales channel that we must conquer. “When you gain the channel, you get the world.”
Sun has her standpoint in view of the above saying. Market environment varies in different regions. Affected by all kinds of economic factors, merely targeting at department stores and supermarkets might not necessarily be the best choice. From 1997 to 2004, Sun had once focused on the above sales channel. However, after a long time of operation, something harassed her. Some department stores and supermarkets require high price for entrance and payment for goods is hardly to collect in time. It affects company’s operation to some extent. In view of this, Sun retuned her emphasis to distribution network in second-line or third-line cities.
It has its advantages: people here adopt prevailing commerce patter—“you give me the money, I give you the goods”. When you trade with this kind of buyers, you can avoid uncollectible accounts. Meanwhile, they always have a good nose on market, who know what consumers need most and what problem a product has. Collecting all these information and provide feedback to makers will enable them to design and improve their products in time. It benefits cooperation and mutual development.
Just like lots of industrial products, toys see an exceeding-demands supply. Keener market competition might arouse merchants’ unusual low-price competitive strategy. Then how to stabilize one’s client source in harsh environment? “I will never use unreasonable ‘extreme low price’ to attract clients. Cut-throat competition will not benefit the whole industry and our own business,” Sun emphasizes, “Retailers are so smart now. They know the reasonable price point quite well. If you intend to attract clients with one or two low-price items, they will particularly aim at those. Without normal profit margin, you can never survive. Therefore, the key is reputation and service, and whether your product is attractive enough. Low price can not maintain long-term cooperation at all.”
Reputation and service
With such awareness, Little Swallow attaches great importance to service. All-round service, faithful operation, rich product lines and reasonable price have cemented the cooperation between the company and its clients.
Judging from the outsides, faithful operation and good service are basic work for every company. But it is not easy to fulfill. Sun manages to do it. It seems to tell us that, you always need innovation method to stand firm in market competition, but fundamentally, reputation and service act as the essence. █
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