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5 tips to start a distribution company

When we have an entrepreneurial spirit and in our heads the idea of ​​creating company, we do perhaps by the desire to fulfill a dream, a market opportunity, or simply the desire to have higher incomes; sometimes based on experience in a market or simply the desire to fulfill that dream so desired.

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For a company is not enough just to be a good entrepreneur, nor good entrepreneur with great administrative skills, leadership, marketing and knowledge of a target market, when you think about being your own boss and start a distributor must take several items into account in this case mention five, no order of magnitude as all are important and should not be let out when analyzing our new distributor:

1. Type of products to be distributed

When we think of distributing we must consider what kind of products we offer, is not the same distributed pencils oranges, bone must think whether they are perishable or products, if expire or not, since it is very important when make the purchase of these products to distribute, purchase or deliver products with a short shelf life, but the risk that soon we will be returning the product if it has not been finalized before the sale is made under a promotion run by producing losses due date for returns.

2. Place or area to distribute

We must be clear that area or in areas which are our customers, our target market, whether it is a small area within the same city or if instead we must travel miles to reach our customers.

3. Transport

Based on the previous item the “square or distributing zone”, the shipping or carriage marks a significant percentage of the costs in the financial analysis of the company, this must be very clear if you plan to drive like a real distributor or simply be handled very rudimentary with saving money shipping with the same suppliers (sometimes they can support), which for me is not ideal for the risk taken by unforeseen at the time of release, this issue it could expand later in another issue to deal with.

4. Negotiation with suppliers

All items mentioned in this article are very important, however, think this item is the pacesetter if really worth starting a distribution company, whether or not, many production companies or manufacturers do not have a distribution channel and want to start operations in a particular area which require companies that know the area, the customers, who already have a covered market, but if there is no clear negotiation, loyalty and respect in the negotiation, before long when products recognized, the supplier may or pretend to continue to sell directly to customers who already works the distributor, so it is extremely important to be clear when negotiating the clear policies, although currently little business is handled exclusively be great to concretize, to avoid the aforementioned

5. Trade Policy with suppliers

When you have a distribution can be purchased in cash or credit depends on the marketing policies of our supplier and our purchasing power, for which we must take into account in trade policy when selling, if we buy cash must sell contact, but it has a good profit margin and excellent financial muscle to finance customers when the cash is not sold on credit but, obviously at great risk money on its customers; if the contrary is bought on credit and sold on credit, the ideal is to seek the return time of the money distributed is less than the time that you must cancel providers but we would again finance customers and running the risk that our portfolio have a longer time than we should cancel our suppliers, and perhaps soon be in the hands of customers, suppliers, and banks seeking loans to finance our customers.

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