Your wholesale distribution is running just the way you want it to, your channels are functioning smoothly and your supply chain is adhering to customer needs. Now you are considering expanding your business, but are unsure how to take the plunge.
Having run a business for quite some time, you are already aware that you will have to deal with a greater volume and variety of products along with increased turnover and these are three areas that you need to be working on. But they would require investment from your end along with some influence on your cash flow.
Following are 5 key areas where distributors should pay close attention to while considering expansion into a large-scale business.
Focusing On The Right Products Your Existent Customers Want
Your existing customers are the best way to know what sells best for you and what isn’t sought after by your customers. By carefully paying attention to what your customers are buying, you should only consider expanding and producing variety of products that are in demand rather than opting for newer brands. This would not only help you retain existing customers but also attract new ones. Being a business entity, you would already be familiar with the fact that it only requires a fraction of the total effort to retain an existing client that you put in to attract a new one.
Providing what your current customers look for, you can guarantee the transition of your customers along with your business. Satisfied, existing customers would act as a great foundation when you start expanding your business. And in order to strengthen your base, it is very crucial that you provide them with the products they are looking for.
Striking The Right Balance Between Prices And Minimum Order Quantities
Most of the distributors are aware that the estimated and existing turnover is a prominent factor when deciding upon a price. With the help of useful data such as past sales, consumer habits and a software that combine all this information into predictions you can come close to setting a price that will be ideal for you.
When it comes to expansion, you cannot rely on mere assumptions. You need to have some hard facts that provide you with the backing that you definitely need.
Making more realistic predictions based on projected sales, you will find it extremely convenient to set minimum quantity order and prices. This would also enable you to seamlessly negotiate with your suppliers without having to compromise on your bulk price deals.
Accepting The Only Constant – Change
While you might be struggling to manage the expansion of your business by providing superior services, you can always consider automation in areas like inbound supply, manufacturing, distribution and delivery.
Streamlining your processes can greatly help you save your time and expand your business accordingly. First you need to identify where you can increase your efficiency and then you can use relevant software to connect all the processes to ensure speedy operations.
Marketing Matters
You have done all the groundwork. You have analyzed what your consumers want, set your prices and minimum order quantities wisely. You have also incorporated software to ensure a speedy flow of processes to match the expansion rate. But if you have ignored the marketing on your expansion route, you are probably making all your other efforts go in vain.
Any expansion venture that isn’t backed by a strong marketing campaign will probably end up with a warehouse full of stock.
In order to cater to the needs of growing market, it is very essential that you have an adept marketing team. You need to perform simultaneous functions such as penetrating into new markets dealing with new customers, and chances are that you would be facing new competitors too. Relevant inventory management software would help you link the various aspects of your business and then connect them accordingly. For instance a handy software can provide your sales team with previous sales data, while it can pinpoint areas that the marketing team can focus most on.
Putting Up All The Pieces Together
If you are offering the highest quality at a low price, it still won’t do you any good if your customers are unable to get their hands on their favorite products. With the advancements in technology, slow delivery time or cumbersome ordering process isn’t what your customers are looking for, and it can turn them away to your competitors, if you don’t provide them with speedy solutions.
If you want your wholesale distribution expansion, then you should consider streamlining all of your business processes by connecting invoicing, supply chain management along with purchasing and ordering system so that the whole system functions without any loopholes.
Summing It Up
With detailed planning and careful execution, a supplier can very aptly make the transition of becoming a successful wholesale distributor. Add on some selective brand variations and increased volume and you have a formula for success.
Business owners who are considering expansion should definitely consider going wholesale as it adds up on their revenue without having to affect much of their existing resources. A well-thought strategy with an expanded product line that is in demand can help you achieve exponential growth.
