Facts About Wholesale.

Wholesale distribution is a very large segment of the economy and constitutes about 7% of the nation’s GDP. Like most startups, the average wholesale distributor will need to be in business two to five years to be profitable. Initially, you may have to be prepared for little or no returns too. There are exceptions, of course. An ambitious entrepreneur who sets up his garage as a warehouse, uses his own vehicle and relies on the low overhead that his home provides, could conceivably start making money within 6 to 12 months.

Sub-Segments

Following are the sub-segments of distributors:

• The wholesale distributors that specialize in a unique niche (e.g., the distributor that sells only a specific brand of refrigerators to kitchen appliance stores);
• Midsized distributors who choose an industry (washing machines, for example) and offers a variety of products to myriad customers.
• Larger distributors that sell everything from freezers to cloth irons (e.g., the distributor with warehouses nationwide and a large stock of various, unrelated closeout items).

Being Out There

Any business follows certain steps to venture into the entrepreneurial landscape, so does distributorship. As a wholesale distributor, your first step is to locate reliable sources of product and define a customer base. The former will soon become your vendors and suppliers. While we are discussing vendors and suppliers, I would also like to mention that these people are your long-term business contacts and will play an important role in the success of your business. Forming a network is extremely valuable for young entrepreneurs. It helps you learn from more experienced people in the industry, as well as to build useful contacts.

Good, strong, lasting business relationships take a dedicated amount of time and energy to build. Today people don’t seem to want to put in the time and effort it takes to form those relationships, in spite of knowing that these are an integral part of success. Lasting business relationships don’t happen or develop without dedicated, consistent work. I know it is easier said than done and it can be challenging for small business owners and new entrepreneurs to know exactly where to start building contacts. There’s no way to possibly explain in detail without compiling a manual the size of a dictionary, every aspect of building your internet presence, that is actually how much this market has been explored. However, to begin with, be nice to the vendors, suppliers and whatever little staff you have for support.

Product and Supply

The basic flow of product from manufacturer to distributor to customer is the cornerstone of every distribution cycle. A supply chain is a set of resources and processes that begins with the sourcing of raw material and extends through the delivery of items to the final consumer. As a wholesale distributor, your position on that supply chain will involve matching up the manufacturer and customer by obtaining quality products at a reasonable price and then selling them to the companies that need them.

To put it simply, wholesale is one of the purest examples of the business-to-business function, as opposed to a business-to-consumer function, in which companies sell to the general public. As a distributor, you must know what are the good place to get your product from and purchase a product from that source, usually a manufacturer, but sometimes another distributor. Next, to sell it to your customer. As a wholesale distributor, you will specialize in selling to customers and even other distributors, who are in the business of selling to end users. While the retails merchants that you supply your product to eventually become your customers, wholesale saves you the expenditure of setting up a store and getting staff to run it.

Visibility

It is always helpful to contact a local advertising company to understand the importance of social networking and see how you can benefit from networking. We have a free one hour session at HyperEffects for aspiring young entrepreneurs and those who have been there and done that. It is our way to promotes more intimate networking sessions. Enrol today to talk to us and discuss challenges that your business faces in terms of marketing, advertising and connecting with the target audience. We pride ourselves in knowing how to overcome them!

Remember, your net worth is only as good as your network.