KanDianTong Launches New Intelligent Marketing System to Help Merchants Improve Operational Efficiency
Set up and manage a distribution system so more people can help you promote.
Compliance red lines
This tutorial covers configuration and management of the Kandiantong distribution system: distribution rules, commission settings, distributor management, settlement and withdrawal, and the team mechanism. Distribution involves real commission cost and a clear legal boundary. Read the compliance red lines below before you start.
Distribution has at most two levels. A team-compensation model of three levels or more is suspected of pyramid selling, which the law expressly prohibits. The Kandiantong system limits the setting to two levels. Do not bypass that by any workaround. Also, do not use an entry fee or recruiting heads as the condition for becoming a distributor. Commission must come from real product sales.
Turn on distribution and set application conditions
Go to Distribution center, then Distribution settings, and turn on Enable distribution. Then set the conditions for becoming a distributor. Three common ones are: any user may apply directly, a user may apply after spending a set amount, and only a manual invitation from the admin is allowed.
For a newly opened distribution system, apply after spending a set amount is recommended, with the threshold around the average order value. Distributors filtered this way have at least used the product, can describe a concrete experience when they promote, and convert clearly better than people pulled in at random. Whether an application needs manual review is also set here. Early on, when there are few people, turn on manual review. It effectively blocks fake-order and bonus-hunting accounts.
Commission settings
Configure this in Distribution center, then Commission settings. The system supports two commission levels: level one is the direct promoter, and level two is the person who referred that promoter. A typical setup is 10% to 15% for level one and 3% to 5% for level two.
How do you set the rate? The formula is: commission-rate cap = gross margin minus the net margin you want to keep minus platform and payment fees. For example, if a product's gross margin is 40%, you want to keep 20% net, and payment and platform cost is about 2%, then level-one and level-two commission together should not exceed 18%. If this number is not clear and you still set a rate, it is easy to lose money on every order you sell.
Commission can be a single rate for the whole store, or set on one product on the product edit page. The product-level rate has higher priority. High-margin products can get a higher commission and be pushed harder. Traffic products should have a very low commission, or even 0. Otherwise distributors only push the easy-to-sell low-margin items, and your profit is eaten up.
Source: https://www.kandiantong.com/support/videos/distribution-system.html