Dealer – a term that evokes both affection and frustration among feed companies. So far, most domestic feed companies still rely heavily on them. This dependency is reflected in the old marketing slogan of the industry: “Winning through the terminal.†But what exactly does this “terminal†refer to? Is it the final farmer, or the last channel for feed products—the dealer? It's unclear. However, one thing is certain: dealers often leave feed companies with a feeling of being "stuck in the throat," a bitter taste that's hard to swallow. In the past, dealers played a crucial role in the development of China's feed industry. Today, however, their existence has become the biggest obstacle to further growth. Therefore, it's time for feed enterprises to re-examine their partnerships with dealers—understanding their current role, future trends, and the evolving dynamics of cooperation. Only by doing so can feed companies break free from the constraints imposed by distributors and accelerate the development of not only the feed industry but also the aquaculture sector.
1. The Historical Role and Achievements of Feed Distributors
In the early days of China's feed industry, many farmers were not accustomed to using industrial feed. At that time, dealers played a vital role in promoting the use of commercial feed. With the market operating as a seller's market, whether it was the feed company, the distributor, or the farmer, all could benefit if they were willing to work and persist. Feed mills, dealers, and farmers formed a basic peer-to-peer partnership, each earning their share and enjoying stability. During this phase, distributors served as the key channel for feed companies, taking on significant promotional responsibilities, allowing companies to focus more on product innovation and production capacity expansion.
2. The Current Situation of Feed Distributors
In the late 1990s, the rapid rise of feed companies led to increasingly complex competition. Large enterprise groups, mid-sized local companies, and small workshops coexisted, resulting in a diversified market landscape. At this point, market saturation began to set in, and the buyer's market emerged. Farmers started to pay more attention to brand recognition, and the survival of smaller brands became increasingly difficult. To survive, small businesses cut profits to compensate for weak brand influence, while large companies followed suit under pressure, causing the profit margins of the feed market to shrink due to constant bargaining with dealers. At the same time, as more people entered the aquaculture industry, China's aquaculture expanded rapidly, but frequent diseases and other factors severely impacted profitability. Many inexperienced and poorly managed farmers suffered losses, struggling to cope with changing market conditions and disease outbreaks. Chinese farmers have long been used to buying feed, and during the profitable era, the main issue was payment methods. Now, their management risks are rising, profitability is declining, and their ability to repay debts has significantly weakened. To reduce their own risks, dealers are constantly pushing pressure on suppliers, demanding better policies and lower prices. Meanwhile, they add more profit margins when selling feed to farmers, creating an abnormal situation where the ends are thin and the middle is thick. Farmers face low profitability, as the high costs of aquaculture ultimately fall on them, yet they find it even harder to make a profit. These repeated cycles have turned dealers into a problematic channel, seriously hindering the healthy development of the animal husbandry industry and slowing down the overall pace of the sector.
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