Core conclusions:There are still 116 days left before the Spring Festival of 2027 (February 6). Domestic trade factories have to complete three things at the same time from October to December: to reduce the inventory turnover target to less than 60 days, to separately list receivables with an age of more than 90 days, and negotiate with major dealers on next year's rebate structure and accounting period before November 30. The key to Q4 is not how much goods we can buy, but whether the refund can be received before the Spring Festival.
1. Calculate three numbers before starting
The amount of inventory on hand, the amount of orders in transit, and the amount of goods shipped and uncollected. These three numbers determine what Q4 can do, not what it wants to do. Many factories had problems in the fourth quarter. The reason was not that there were not enough goods to sell, but that three sums of money were pressed on the same line at the same time: raw materials had to be paid, inventory had to be spread into channels, and accounts receivable had not yet been returned.
Write these three numbers on a piece of paper, and then write down the money you must pay before the Spring Festival (raw materials, wages, year-end bonuses, taxes and fees) and the money you expect to collect back. The difference between the two sides is the real funding gap for Q4. If this gap is not clear in October, it will have to be solved by price reduction and delay in December, and the cost will be even higher.
2. How much to prepare: Use the formula to calculate, without feeling
Safety stock = average monthly sales volume × (1 + fluctuation coefficient). The fluctuation coefficient is divided into three categories: 0.2 for universal parts with stable demand and reworked; 0.4 for universal parts with obvious seasonal fluctuations; and 0.6 for those with strong binding to promotional activities. After calculating the safety stock, first subtract the in-transit orders, and then subtract the part that the peers can transfer. The rest is the quantity to be prepared this time.
| Category characteristics | fluctuation coefficient | stock action |
|---|---|---|
| Universal parts with smooth demand and reworked | 0.2 | Prepare sufficient safety stocks and keep prices unchanged before the Spring Festival |
| Seasonal and rapid style change | 0.4 | Only 70% is reserved, and the rest of the production capacity is reserved for quick return orders |
| Strong binding with promotions | 0.6 | Prepare goods according to the forecast volume of the event, and clear the tail immediately after the event. |
There are three judgment principles: customers with long accounting periods should be given priority; categories with short return cycles should be given priority; SKUs that have been in the warehouse for more than a year after the Spring Festival last year should not be prepared this year. The essence of stocking is to put funds on the part of the goods that are most likely to be sold, rather than covering all categories.
3. How to collect the refund: Classification according to account age, without waiting for payment
Divide receivables into five categories according to age: 0 to 30 days, 31 to 60 days, 61 to 90 days, 91 to 180 days, and more than 180 days. The first two gears flow normally, and the reminder rhythm will enter the 61st to 90th days. After 90 days, separate lists will be followed by special personnel. The significance of aging classification is to turn "who should rush first" from a feeling into a rule, so as to prevent sales from only focusing on new orders and ignoring old accounts.
The payment window is 45 days before the Spring Festival. During this period, dealers have to prepare goods and pay annual payment. The funds are relatively abundant, and it is also the stage when manufacturers 'support is most needed. Tying the payment collection policy with the Spring Festival stocking policy is more effective than separate payment after the holiday. There are two details worth doing in the operation: one is to check the account with the dealer in advance and negotiate the disputed amount before November to avoid blocking the entire payment due to a reconciliation disagreement before the Spring Festival; the other is to write the payment back into the sales commission plan, and no commission will be counted until the payment reaches the account or accrued according to the proportion of the payment, which is more effective than emphasizing it at a meeting.
4. When will policies be discussed next year: before November 30
The four matters of rebate structure, accounting period, regional protection, and annual task volume should be negotiated with major dealers before November 30. The reason is very practical: the dealer's stocking funds will be discharged in December. The later you give the policy, the more he will have to use last year's plan to raise money, and you will have to passively accept the annual workload.
- Rebate structure:Proportion of monthly refund, quarterly refund, and annual refund and payment time point. If the annual return ratio is too high, it will be delayed until the following year, and the financial pressure on dealers will be reflected in the usual purchasing pace.
- Accounting period classification:Classification is based on last year's collection records, rather than giving all dealers a unified accounting period. Once the rules are made public, most dealers accept the rules rather than numbers.
- Area protection:Clarify the boundaries between online channels and offline distribution, and write the authorized online scope into the agreement to avoid competing prices in the same area.
- Annual tasks:Combined with next year's production capacity and capacity utilization rate, we should first confirm how much we can supply, and then determine how much dealers should sell.
5. Common questions
1. I am afraid of pressure when I stock up, and I am afraid of running out of stock if I don't prepare. How to make a decision?
Separate categories and determine them separately, and don't give them an overall goal. If the return cycle is long and the demand is stable, reserve sufficient safety stocks; if the style changes quickly, only 70% will be reserved, and the remaining production capacity will be reserved for quick return orders. In this way, even if there is a deviation in the judgment, what is on hand is the goods with quick refund, rather than the out-of-season goods that cannot be sold next year.
2. The dealer said that funds were tight and requested to extend the account period. How to answer?
Link the accounting period to the collection record rather than to verbal commitments. This year's billing period will be the same as last year's on-time payment rate; at the same time, the option of exchanging cash for price is given, allowing dealers with abundant funds to choose for themselves. What I am most afraid of is that there are no exceptions to the rules. As soon as we open up, exceptions will be made all year round.
3. Should I do promotions before the Spring Festival?
Look at the inventory structure, not the calendar. If the category is returned quickly and can be sold normally next year, there is no need to reduce prices for sales; if the styles change quickly and will be replaced next year, before the Spring Festival is the last window for clearing the goods, and it is more cost-effective to do promotions than treat them as the last goods after the festival. The criterion for judgment is "whether it can be sold next year", not "whether there is pressure now."
For factories doing domestic trade, what Q4 really needs to assess is not the shipment volume, but the cash returned to the account before the Spring Festival: stocking determines how much can be sold in this season, and the return determines whether construction can be started in the next season.
Qihang Zhilian Foreign Trade Research Institute·Let China's intelligent manufacturing industry set sail to sea·Tel: 180-0327-6609
