The wholesale distribution business in the U.S. is a huge industry that accounts for literally trillions of dollars of sales every year. The age old practice of buying goods from manufacturers and the reselling them at a profit to retailers and other businesses is a business activity that continues to thrive and evolve. Today new opportunities are emerging for entrepreneurs to start small distribution businesses in niche markets that are not on the radar or are currently too small for the big players to bother with.
This article will provide a list of the top advantages of either launching or buying a distribution business including the relative ease of getting started and the ability to start out small and grow at your own comfortable pace.
Relatively Easy & Quick To Start:
Distribution businesses are service related so they don’t require the build out or leasing of a fancy retail location or the start up of an expensive manufacturing plant. So in comparison once you have contracted a supply of products to distribute you can often be up and running very quickly. Whether you will need to secure warehouse space to store and ship your goods will depend on a number of variables including the type & size of products you plan to distribute. The good new is that if you do need to lease commercial warehouse space to get off the ground it is often much cheaper than high visibility retail space as your physical location is not that important to your customers.
In fact many distribution businesses are often launched successfully as home based businesses with a garage or basement serving as “dirt cheap” warehouse space. Whether this arrangement becomes permanent or not will depend on a number of variables including how large you intend to grow your business.
Potential Low Start-Up Costs:
Depending on the type of product you to intend to sell, starting some types of distribution businesses can be extremely affordable vs. opening a retail store or restaurant for instance. It’s very possible for example to start a business that distributes inexpensive imported sunglasses or jewelry to retailers for literally a just few thousand dollars, or less. Other than securing a supplier all you need to get off the ground in most cases is a phone, a desk, a computer maybe, and a little space to store your product. And of course if you can operate the business from home you obviously don’t have the monthly overhead expense of leasing space.
Grow At Your Own Pace:
The fact that you can start out very small and grow your business incrementally as needed or desired is one of the great advantages of starting and owning a distribution type business. There are numerous success stories of distributors that started out in a small basement or spare bedroom that eventually grew into businesses that do millions of dollars in sales a year. Growing at your own pace puts the owner in the driver seat as far as controlling core expenses like rent and can provide a certain comfort level while you learn and build your business.
And finally because distribution is a generally a “business to business” activity where you are selling to other businesses you don’t have to deal with a lot of the negative aspects of being a retailer or selling to the public. This includes generally shorter hours and only being open 5 days a week as compared to many retail businesses that are often opened 6 to7 days a week. Ultimately this distinction could provide you with more flexibility and free time to spend on other priorities in your life including your family.
Ray Haiber has 12 years experience as a professional business broker and franchise sales consultant. You can view franchises for sale across the USA here. Go here to research affordable and low cost businesses for sale including distribution opportunities.