If you have good negotiation skills, are a keen salesperson, and have your finger on the pulse with regards to trending items on the market, then starting a wholesale distribution business may be just for you. It may be a daunting task to consider the road and load that lies ahead, but with research and understanding, you will be able to push your new business towards the heights of your aspirations.
First Things First
Firstly, you need to have a clear vision of what it is you want to achieve, and how you’re going to fund it.
At the starting line, you may want to begin with finding a niche market and possibly expand from there. What is it that you want to sell? Know the market and brands available in your chosen field, and research your competitors. How can you make what you have to offer better than theirs? Remember always that your price needs to be competitive, but you need to make money. Customer service is vital, and this is often a reason that businesses lose customers to newer, more caring entrepreneurs. Research your potential clients. Find out what they are looking for. Here your people skills will be very useful.
The next step is to find a reliable, trustworthy supplier. They must not only offer you good prices but quality goods too, and they must be able to deliver to you quickly and affordably. For this reason, their location in relation to yours is important to consider. Choose these partners carefully and build a good working relationship. This can lead to exclusivity deals in the future that could be beneficial to you both. Remember to check whether you need a wholesale license in your field of operation.
Finding and Setting Up Your Space
Depending on what it is you will be distributing, you may need to find storage space. Warehouse-type space is popular, just remember to consider all costs involved. You may need to get a forklift and some pallet racking. This is all dependent on your budget and access to capital. Perhaps you can share space with another business to save costs initially.
The set-up behind the scenes can be as complex or as simple as you decide. If you have warehouse space, you can likely set up an office in a corner of the area. Here you will need your telephones and computers. It is advisable to set up an accessible website that integrates your inventory and accounting systems. Scanning devices may also be a good investment as a part of your operating system. It is important to pay special attention to the amount of stock you will keep in your inventory. It is not good business practice to run out of stock, but no business wants to be left with excess stock taking up space in the warehouse. You need to think about how you will manage your stock levels, and what your returns policy may be. Establish good customer relations by offering loyalty bonuses that differentiate you from the competition. Also, consider what payment options you will have available, e.g., cash, card payments, bank transfers, or credit plans.
Getting Your Stock Moving
The next step is to decide how you will get your chosen product to your customers. Will you have a fleet of delivery vehicles, use courier services, offer a cash and carry collection option, or a combination of these? Having your own vehicles is a bonus as you can make extra offers available like frequent delivery, online ordering with same-day delivery, or even late-night or weekend deliveries. This will mean you must ensure that you have the right insurance cover. A regular policy will not cover your vehicles and your stock. You need to find an insurance provider that specialises in courier van insurance as they will cover your extra miles and consider the value of the items being carried. You can compare comprehensive courier van insurance on sites like quotezone.co.uk, and find a policy that ensures all eventualities are covered to include third party, fire and theft. Look for one that will pay for repairs to your vehicle and cover damage should you be involved in an accident. A courtesy vehicle should also be provided. You may even want to add public liability insurance and employer’s liability to your chosen cover.
Just a reminder that most new companies take two to five years to be profitable, so work hard and be patient. There are, of course, exceptions to the rule! If all goes well, your business is one of those exceptions! Remember – it’s not only what you sell, but how you sell it. Use all means possible to get your business out there and onto customers’ lips. This can include leaflets, website advertising, social media, special offers, telesales, or even sponsoring a charity event. Attention to detail is vital in starting any new business, and if you follow these guidelines, you should take your wholesale distribution business far.