Bridget McCrea - Start Your Own Wholesale Distribution Business: Your Step-By-Step Guide to Success

Additional titles in Entrepreneurs Startup Series

Start Your Own

Arts and Crafts Business

Automobile Detailing Business

Bar and Club

Bed and Breakfast

Blogging Business

Business on eBay

Car Wash

Child-Care Service

Cleaning Service

Clothing Store and More

Coaching Business

Coin-Operated Laundry

Construction and Contracting Business

Consulting Business

Day Spa and More

e-Business

Event Planning Business

Executive Recruiting Business

Fashion Accessories Business

Florist Shop and Other Floral Businesses

Food Truck Business

Freelance Writing Business and More

Freight Brokerage Business

Gift Basket Service

Grant-Writing Business

Graphic Design Business

Green Business

Hair Salon and Day Spa

Home Inspection Service

Import/Export Business

Information Marketing Business

Kid-Focused Business

Lawn Care or Landscaping Business

Mail Order Business

Medical Claims Billing Service

Net Services Business

Online Coupon or Daily Deal Business

Online Education Business

Personal Concierge Service

Personal Training Business

Pet Business and More

Pet-Sitting Business and More

Photography Business

Public Relations Business

Restaurant and More

Retail Business and More

Self-Publishing Business

Seminar Production Business

Senior Services Business

Travel Business and More

Tutoring and Test Prep Business

Vending Business

Wedding Consultant Business

Wholesale Distribution Business

Entrepreneur Press, Publisher

Cover Design: Beth Hansen-Winter

Production and Composition: Eliot House Productions

2014 by Entrepreneur Media, Inc.

All rights reserved.

Reproduction or translation of any part of this work beyond that permitted by Section 107 or 108 of the 1976 United States Copyright Act without permission of the copyright owner is unlawful. Requests for permission or further information should be addressed to the Business Products Division, Entrepreneur Media Inc.

This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is sold with the understanding that the publisher is not engaged in rendering legal, accounting or other professional services. If legal advice or other expert assistance is required, the services of a competent professional person should be sought.

ebook ISBN: 978-1-61308-283-6

Contents

T hinking back to my first real job, I remember walking into a small showroom full of welding supplies and miscellaneous products hanging on pegs and wondering to myself, What in the world does this company do?

At the time, all I knew about a welding supply distributorship was that it paid well compared with the rest of the jobs I had interviewed for, and the owner seemed slightly impressed with my resume. With that, I found myself in the position of office manager for a three-person wholesale distributorship. My duties included loading trucks bound for job sites with cylinders of welding gases, packing and shipping boxes of welding wire headed overseas to companies like Air Products, and delivering damaged hydraulic gauges to a repair shop for a local cryogenics plant.

What followed was four years of hands-on experience in the wholesale distribution business. When I became a freelance business journalist, that job experience stuck, and I landed various distribution- and industry-related assignments.

Today the distribution landscape is a bit different than it was back in the early 90s, when I was filling out government bids for welding machines. Between rapid advances in technology and the most recent economic recession, the wholesale distribution landscape has gone through many changes. Add in the fact that huge, online-only retailers like Amazon have moved into new wholesale product categories and its clear to see that todays distribution landscape is very different than the one that companys operated in back in the 90s and 00s. The good newsas youll read in this bookis that there are still many opportunities for wholesale distributors to carve out their niches in the business world. The fact is, manufacturers couldnt survive without distribution networks. Sure some of them may opt to sell direct (i.e., creating their own sales networks to sell directly to customers), but for the most part the firms that develop and market products need the help of wholesale distributors to get their products to market.

Take the electrical distribution sector, for example. I regularly interview both manufacturers and distributors for The Electrical Distributor magazine, and both sides preach the value that distributors bring to the table. So even in a world where the next product source is just a click away on the internet, the knowledge, expertise, and customer service that a wholesale distributor provides remains a strong component of any manufacturers go-to-market strategy.

On the other side of the coin, the companies and other organizations that buy from distributors are also highly dependent on these expert middlemen. No manufacturer in the world can give the proper amount of attention to every end user. However, when territories are broken down and covered by individual distributorships, the task suddenly becomes more manageable. Take the contractor stuck on a job site in need of technical assistance with a product just purchased through a local distributor. Who do you think he should callthe distributor or the manufacturer? One is local, while the other will probably require a long-distance call and some time spent on hold.

In the end, it doesnt look like the wholesale distribution industry is going to be phased out by direct sellers and buyers who no longer want to deal with a middleman anytime soon. Youll meet all the entrepreneurs and experts we interviewed and youll see the industry is thriving. Plus, manufacturers will always rely on distributors to act on their behalf when it comes to functions such as customer service, sales, collections, and marketing.