Convenience store distributors are the links between the manufacturers and the convenience stores. They are the lifeblood of the convenience retail industry. Their job description may sound simple, but their importance cannot be overstated. Becoming a convenience store distributor is a good decision, but without the right information, it may amount to wasted efforts.
Below is a four-step guide on how to be a convenience store distributor in the United States.
1. Understand the dynamics of the industry
The convenience store distributor has two primary functions: to buy from the manufacturers and sell to the retailers. It is as simple as that on paper, but there is more to it. The distributor acts as a middleman between the manufacturers and the retailer. He buys existing product lines from the manufacturer or new products, which he would help introduce to the end-user by selling to the retailer.
A proper understanding of how the business is managed would help you to navigate the processes and procedures of the company. To understand the dynamics of the industry, you need to study market trends, carry out market research, and also, acquire relevant experience in the industry.
2. Draft your business plan
Distributorship is a business like every other one. Therefore, a business plan is required. You will need to outline a distribution strategy, a financial plan, and a strategy for how you intend to market the products you sell.
Your distribution strategy depends on what specialization you decide to delve into. It is advised to start by distributing a few products. This will help you establish a good foundation for the business.
Distribution requires a robust financial plan. You will need warehouse space, transport facilities, and inventory equipment. Your financial plan contains how you will ensure that your business activities: buying, selling, and spending are done profitably.
3. Proper licenses and permits
Apply for the necessary licenses and permits from the constituted authorities of the business. The Federal and State government require distributors to have permission to operate in their territory.
4. Get started.
After you have equipped yourself with everything necessary, you need to start. Till you start doing the business, you can not be called a distributor. Make contacts with convenience stores and offer to sell to them. Also, contact manufacturers and buy their products. Establish connections with both ends of the chain.
To be a successful convenience store distributor, you have to own some skills. These required skills include excellent communication and negotiation skills, organization skills, and financial skills. A distributor would deal with a lot of buying, selling, discounts, credits, and inventories. Without a basic knowledge of accounting and finance, it might be challenging to manage the enterprise. Negotiation and communication skills are a must. They are essential to the effective management of business relationships.
In a nutshell, becoming a convenience store distributor goes beyond buying and selling. It requires that you understand the intricacies and the economics of distribution before you become one.