Everyone wants to be successful. It’s a natural human instinct that motivates us to get out of bed every day and be the best versions of ourselves that the world has ever seen. It’s also what drives the hunger inside every good businessman and woman.
The fact of the matter is, however, that most business ventures don’t work out. In fact, more than half of all start-ups close within the first year of their operation, with many more choosing to shut down in the second or third years after things turned south following an impressive opening 12 months.
This is especially true for the distribution industry, which is notorious for its relentlessly competitive nature and cold hearted attitude towards entrepreneurs who don’t have the gut to go all the way. It’s a tough world to survive in, but there are certain tips and tricks you can use to climb the ladder to success.
Here are 5 tips for success in the B2B wholesale distribution industry:
1. Smarter Hiring Practices
This might seem like a fairly obvious thing to say, but hiring policies affect business success more than most entrepreneurs realise. These are the people who will directly determine your day-to-day productivity, the company’s efficiency, quality of customer services, and everything else in between.
If you fail to put in the required effort during the hiring process, then your employees will eventually fail you. It’s just one of the many harsh realities of the business world.
For this purpose, it’s essential that you establish certain standards and benchmarks early on. You’ll find plenty of sales reps in the industry who can answer any technical questions you may have, but how many of those candidates will be truly invested in your company’s success?
Your priority as a business owner, especially during the first year of operations, should be to hire employees based on their behavioural and moral compass rather than just technical knowledge. These are the people you’ll be crediting with your company’s success 5-10 years down the line.
2. Automated Orders
It’s surprising to learn how many distributors are still following the archaic method of taking orders manually on paper forms despite the present of powerful software that can handle the task efficiently and gracefully.
During your market research, you’ll come across plenty of old-school distributors who have shunned technology altogether. They’ll say they prefer to operate manually because they like to be hands-on with their business, but even you know the real reason is that they were unable to keep up with the digital age and now they feel like it’s too late to automate operations.
As an entrepreneur setting up a new business in today’s day and age, you have to be tech-savvy enough to either incorporate technology into your operations yourself, or hire someone to do it for you. The value mobile devices and computers can offer to B2B distributors is practically immeasurable, so make sure you aren’t falling behind your competition who have already upgraded their systems.
3. Intelligent Inventory Management
Ask any successful B2B wholesale dealer what the biggest headache is with running a distribution business and 99% of them will say “inventory management”. You simply can’t be successful in this industry if you don’t have a grip over the stock coming in and going out of your warehouses.
Smart inventory management software tools constantly monitor stock levels for all products in the warehouse. As soon as stock levels for a certain product reach the set minimum, new stock is ordered either automatically or manually, depending on your preferences.
New AI enabled software is adding even more functionality to this process by predicting how stock levels are going to vary over the next 2-3 months depending on consumer buying behaviour and history. If this software senses that a certain product will go out of stock, it orders a new quantity well in advance. The quantity ordered is also determined by what kind of demand is expected.
Which inventory management strategies you decide to use will depend entirely on your requirements and preferences.
4. B2B E-commerce
This is easily the most important point on this list. The B2B industry recently underwent a major technological revolution as wholesale distributors finally understood how much value there is operating online in addition to brick-and-mortar stores.
Historically, distributor websites only existed to serve the business’ current customers, who could book a new order or track a certain shipment, but not much else. The websites were incredibly dull, and there was almost no value to be found for new prospects aside from that they could view the company’s catalogue.
Nowadays, however, it’s an entirely different story. It’s become almost impossible to differentiate between distributor and retailer websites, and the entire site is geared towards impressing new visitors. In other words, the B2B industry and finally caught up to B2C trends and practices.
This is important because modern B2B customers are nothing like the ones from 20 years ago. This younger generation expects to get the same level of value added service and customer support that B2C companies offer to the end user. Providing a seamless online shopping experience is a large part of that.
5. Value Added Services
As we mentioned earlier, the wholesale distribution industry has never been as competitive as it is today. In an effort to stand out from the crowd, most companies are resorting to the oldest trick in the business book; lower prices and higher discounts.
While this strategy certainly does work, it only gives you short term gains. For long-term growth, you need to capture a consumer’s attention and retain it through outstanding customer services. Treat them so well that the thought of switching over to a different business doesn’t even cross their minds.
That’s how to truly stay ahead of your competition in the modern world. Provide a shopping experience unlike any other. This can include everything from faster delivery times to exclusive personalised promotions.
Related Articles:
How To Start Your Own Distribution Business From Scratch
