Investments You Should Be Making in Your Wholesale Enterprise
A well planned, well-thought out business model is at the heart of any successful and prospering business.
Being a wholesale supplier and distributor is incredibly challenging. It varies from industry to industry, of course, with some industries having a lot of room for growth and expansion, hundreds of retailers to build a clientele from and immense profitability. Other industries are tough to break into, have a limited scope, stringent supply chain and a monopolized market with competition from big-league businesses that your business doesn’t start a chance against.
Like any business, however, setting up a wholesale enterprise comes with a set of unique obstacles and requirements. There’s no set formula that will guarantee success or bring in a loyal client base—persistence and consistency are the keys to success.
A lot of external factors play into the success and reach of suppliers too; from client demands and needs to competition, market conditions and fluctuations in taxes, rates of inflation and other costs such as fuel and transportation, can all make for an incredibly strenuous process.
With limited resources and smaller clientele, many small businesses in industries such as food supply, struggle to manage orders and stay afloat, sustaining their businesses in the long run.
How can small-scale wholesale businesses see greater results?
A well planned, well-thought out business model is at the heart of any successful and prospering business. Thoughtful decision making and actions need to be taken, instead of being dictated by random whims and ideas. Accountability as an entrepreneur is absolutely necessary and even if the ultimate decision lies in your hands, perspective and flexibility are important features.
It’s about making the right choices for your business. Your business sense and intuition play a major role in how you plan the move forward, using not just data and following trends to plan. It’s necessary to factor in the pros and cons of each decision, each change and each addition that you make to your business plan, because the effects need to be accounted for.
Despite having general competitors in your field or industry, do you have those with specific niches like yours? Competition isn’t just a target for who you need to eliminate or whose market share you want to capture—it’s about finding a point of reference, watching what your competitors and other businesses in your line of work are doing, adopting strategies and taking risks that will pay off in the long run.
Greater risks mean greater rewards and as an entrepreneur, it means taking risks—albeit calculated ones—to evaluate how far you’re willing to go to succeed.
It also means making the decision to hold off on certain actions and routes, even if the rewards seem promising. Perhaps it’s not aligned with your company’s long-term goals, such as investing in a warehouse that’s located in a particular place, when you plan to move the business to a different location altogether.
What you, as a food supplier for vegan restaurants specialize in by bringing in organic, GMO-free supplies, will vary immensely from what a ‘competitor’ business will do, in terms of sourcing their stock. If your clients are demanding transparency because it’s needed for their larger business objectives, but you’re unable to deliver it, the decision to choose a farm or marketplace that doesn’t sell organic foods will cost you heavily.
What are must-haves for running a successful wholesale business?
Though each business varies in terms of structure, hierarchy, operations, scale, clientele and niche, there are certain things that help ascertain a level of success for any wholesale business.
What you decide to do at the start of your business may require complete deviation a few years down or with changes in market trends and that flexibility might determine how much success you see as an individual. In Australia, the market for wholesalers is incredibly profitable, especially for food suppliers, since the tourism, food and restaurant businesses are booming here and there’s a huge market for food suppliers.
As for things your business should definitely be investing in, here are a few:
Warehouse and Storage
This is typically a major cost that wholesale suppliers incur. However, rather than seeing it as a cost, it should be viewed as an investment that will pay off in the form of better organization and higher customer satisfaction.
Investing in the right storage and warehouse facilities from the get-go can help you get major costs out of the way in the start. For most food suppliers, warehouses are where non-perishable food items such as flour, rice, spices, etc. can be stored. These are also places where items can be packaged and deliveries prepared, inventory recorded and orders distributed.
For more easily perishable items such as meat, vegetables and fruit, all of which also need to be stored properly, there needs to be sufficient space for fridges, freezers, ventilation until orders can be sent to retail customers.
Investing in small but manageable, hygienic, strategically located and cost-effective spaces and equipment is the correct approach, since making the wrong choice can end up costing more in the long run. A seemingly reasonable space that costs less in terms of rent and utility might lead to you upsetting and eventually losing clients due to delayed delivery, produce that isn’t fresh and perishable items that go bad in the travel time.
Weighing your pros and cons and making a choice to go with something that is beneficial to your long-term business goals is better than what seems like it’s going to save you a few hundred dollars a month.
Speaking of deliveries, these are another major investment for wholesale distributors. Many small scale wholesale businesses struggle with their delivery systems, which are an added cost that includes fuel, vehicles, manpower and also handling customers on the receiving end of your product.
Large scale suppliers don’t need to face that kind of issue, given that they have resources and manpower to set up efficient, fast and secure delivery systems that improve the business’s performance.
Competing with these big-league players is no joke, with rising costs of fuel and a constant struggle to build a clientele. A way around this is to find a reliable service you can outsource your deliveries to. Plenty of small businesses have other B2B connections that allow them to pool in resources and optimize their own targets and increasing efficiency.
It allows you to stay at par with competitors, perhaps at a fraction of the cost it would take to set up an in-house delivery system. In the future, with expansion it might be worth setting up, but investing in delivery systems is going to help your business efficiently offer your services.
Order Management Systems
An Order Management System (OMS) software is perhaps one of the biggest, most important investments you can make into your business. OrderTron can help take your retail business to the next level, increasing profitability, accelerate your order taking and processing, reduce sales and bring down the time and effort it takes to communicate with your clients. Not only that, the right OMS, such as ours, is also going to eliminate the need for data entry, by tracking your inventory, orders and everything in between.
Suppliers in the food industry struggle with managing their orders, especially because the nature of their work require dealing with perishable items, the overstocking of which leads to food waste, losses, lowered rates due to an excess of buffer stock and several other issues.
OrderTron—through its intelligent design and algorithm—can help eradicate these issues, giving wholesalers the chance to maximise their profits and minimise their costs. It’s an intelligent system that streamlines the entire process of taking orders, helping suppliers bring all their retail customers on board in one place.
It provides access to the suppliers’ catalogue, so customers can easily see rates, quantity and the complete stock before placing orders and even set up standing scheduled orders. These allow for less coordination and hassles when it comes to routine order placement, easily streamlining the entire process from the backend to the client’s end.
The OMS you use for your business is a resource in and of itself, eliminating the need for large teams and an increase in manpower, helping you cut costs of setting up teams and hiring individuals. With the taps of a few buttons your clients can order through smartphone apps, available for iOS and Android, and you can process their orders just as easily.
Having an effective marketing strategy for your wholesale business is also a game-changer. Not everyone understands the ropes around the incredibly exciting world of marketing, which is why asking for professional help is worth every penny. It’s tricky to navigate marketing strategies as a wholesaler, since most approaches are more from the point of view of the retailer. You’re targeting businesses whose services align with your supply, building a strong, long-lasting work relationship, which means your marketing strategy needs to target them the same way too.
If you’re entering the wholesale market, or are already in it, don’t undermine the importance of the investments above. Make use of technological advancements and opportunities for growth as they come. To avail the benefits of the order management system, OrderTron, get started here.