Anyone who’s running a wholesale B2B distribution business knows that there’s a lot of work going on behind the scenes. From fulfilling large order volumes to handling the hiring process to planning and managing your cash flow, inventory, and sales, securing a long-term success is no easy feat as there’s a long list of boxes you need to check regardless of the type of product you’re selling.
What’s more, you ought to maintain good relationships with customers and make things as convenient as possible for them while simultaneously navigating the competitive landscape of the distribution industry. It can get really tough out there, so here are some helpful tips on how to run your business successfully.
Make an effort to hire the right people
Your business’ overall success along with day-to-day efficiency and productivity largely depend on who you decide to hire. This is something many entrepreneurs don’t pay enough attention to, leading to them investing minimum effort into the recruitment process.
Start by setting particular benchmarks and standards to evaluate the candidates against. Other than hiring the best talent, look for individuals who are invested in making your business a success. Also, make sure you train your employees right and give them everything they need to succeed. Whether you’re making updates to a particular system or educating them about standard operating procedures, by making sure your personnel understands how everything works, you’ll provide guidance to your employees. This, in turn, will help improve performance quality and efficiency while simultaneously reducing errors and miscommunication in the workplace.
Focus on building long-term customers
As the wholesale marketplace gets more and more competitive, differentiating your distribution business is a vital step in the process. While your first thought may be to reduce price offering to boost sales, that’s not exactly the most effective strategy. Your goal should be to build long-term customers, and this is something you can achieve by offering exceptional customer service.
For instance, let’s say you’re a business that focuses on distributing wholesale baking supplies to everyone from amateur home bakers to established, reputable bakeries in a particular area. To ensure customer satisfaction, consider investing in technology that will help you manage larger volumes of orders. You can also use digital catalogs for an effective product promotion, leverage email marketing to connect with customers easily, and work on minimizing delivery time to help ensure more repeat customers.
Improve the way you monitor your cash flow
Other than speeding up the order fulfillment and using other effective strategies for ensuring outstanding customer service, you should also pay attention to your cash flow management. The truth is, running a business can be hectic enough. Without an efficient cash flow management system in place, it’s impossible for your business to flow smoothly and sans interruptions.
Start by setting a credit limit for vendors to avoid giving an overextension – a common mistake wholesale distributors make. Make sure you collect your receivables too, and be diligent about it so that you always get paid on time. Make a habit of creating detailed statements on a daily basis as well. This will help you keep track while also making sure you stay aware of your financial situation at all times.
Be smart about managing your inventory
Just like cash flow, your inventory also requires an efficient, easy-to-use system in order to be managed properly. Maintaining a super-organized inventory is a must as it prevents you from holding too many products in hand by making sure you have just enough stock. While it might be tempting to stock up, you want to avoid overdoing it and purchasing more than you need.
The second aspect of keeping your inventory successfully under control is by figuring out how you’re going to do it. Since you’re working with large stock volumes, consider using a smart inventory management software. Some companies may decide to keep safety stock or maintain minimum stock levels. Others may rely on delivering items right around the time for shipment. It’s best that you develop an inventory management strategy that works best for your distribution business.
Wrapping up
Wholesale distribution can be quite lucrative, but there are steps you need to take to ensure success in the industry. By focusing on the aforementioned key areas, you can manage to overcome the numerous challenges imposed by its competitive nature. This, in turn, can boost the odds of your business venture working out and increase its chances of long-term success.
Eve Anderson is a marketing specialist turned blogger. Interested in sports and exciting travel destinations. She loves to share content that can inform people.
