Entering the realm of wholesale food distributors and food distribution companies can be difficult. Thankfully, Atlantic Dominion is here to help. As a top wholesale distributor in Virginia, North Carolina and South Carolina, we have the expertise and knowledge to help you. In this article, we will discuss the role of the distributor, who the target market is, and the skills you need to remain profitable.
Role of the Distributor
The main role of the distributor within the distribution chain is to act as the middleman between manufacturers and retailers. When a manufacturer creates a product they need a way to distribute them to all the different retailers. Some distributors—known as retail distributors—take the manufactured product and sell it directly to the end customer. Other distributors—merchant wholesale distributors—take the product, store it in a warehouse, and sell it to retailers, merchants, or companies that want to sell it to an end customer.
Who are Customers in Wholesale Distribution?
The end goal of a wholesale distributor is to re-sell products at a profit. However, instead of selling these goods to a customer (like a retail store), you will be selling to businesses. Within merchant wholesale distribution, there are a variety of different customers that the distributor can serve. This can include anything from convenience stores to grocery stores. That is why building up a good customer base is necessary for a wholesale distribution business.
Remaining Profitable
One of the main goals of any business is to remain profitable. However, when entering the realm of wholesale distribution, this can be a tricky balancing act. There are a variety of skills you need in order to remain competitive. This includes the ability to manage inventory, manage cash flow, build relationships, and position yourself with a competitive advantage.
Manage Inventory
Many wholesale food distributors don’t recognize the skill it takes to manage inventory. Food has an expiration date. Making sure you have the inventory to meet your customers demands while also not keeping too much is a balancing act.
You can’t order too much inventory because you will be left with food that you spent money on and wasted when it goes bad. But you also can’t have too little inventory, because you need to be able to meet the demands of the businesses you deliver to.
Similarly, you need to be able to accurately calculate the amount of time it will take to receive the shipment after ordering and the amount of time it will take you to deliver any incoming orders. You can be planning orders months in advance all while balancing current orders.
Manage Cash Flow
Another part that needs to be managed in wholesale distribution is the cash flow. Many food distribution companies choose to offer their customers credit. While this is not an inherently bad thing, and can actually be good for business, ensuring that you will have enough cash on hand to pay for orders is paramount.
You don’t want to be caught in a bind where you can’t pay the manufacturer because your customer hasn’t paid you. Make sure to set limit amounts and time amounts for any credit account your customers open.
Build Relationships
As we mentioned above, building relationships is crucial in the wholesale distribution industry. Unlike traditional retailers, you cannot rely on the creation of a brick and mortar store to drive in traffic. You need to build the business to business relationships yourself. Marketing, customer outreach efforts, and a good working relationship with existing customers will help build long-lasting relationships.
Position Yourself with a Competitive Advantage
In order to entice businesses to work with you, you need to have a strong competitive advantage. Whether that be your excellent customer service, your fast shipping times, your online shopping experience, or even your unique inventory choices. Make sure that you are positioning yourself and your wholesale distribution business with a competitive advantage.
Wholesale Food Distributors in Virginia, North Carolina and South Carolina
Atlantic Dominion has been a wholesale distributor in Virginia, North Carolina and South Carolina for over a century. We have positioned ourselves as the premier convenience store distributor and have branched out to cover multiple markets. We understand how difficult it can be to enter the realm of wholesale distribution. Our expertise and experience are highly sought after.
Are you ready to learn more about entering the realm of wholesale distribution? Contact us today to see how your business can benefit from our services.
