Combine Wholesale Distribution with the Beverage Industry and you get one of the most profitable and fun businesses in the world.
This article will give you an introduction into this great business, how you can start and how much money you can make on each case of beverage sold. Is beverage distribution for you? Find out right now.
Beverage distribution is one of the easiest and most profitable businesses I’ve seen.
I like it because you don’t need a lot of customers to make a lot of money. You can easily make an extra $5,000 with a few customers.
You will see why beverage is one of the best businesses in the world. I started in beverage while I had my tool and novelty distribution business. I was looking for new products, products that I did not need to exchange so often and that I could sell over and over again to the same customers. This last part was key.
You see, when I was selling tools I figured that I could sell up to 1,000 tools per day or more but every customer was unique. In other words, if you buy a hammer at a store on Monday chances are you will not go on Tuesday and buy another Hammer. Even if it only costs $1.98!
Don’t get me wrong, the “tool distribution business” is a wonderful business and I still love it. I was just looking for another type of product to add to my current items.
I figured out that in order to sell the same product over and over again it would have to be a food product. So I started going to trade shows and looking at chocolate, potato chips, candy, and other products. I even looked at name brands like Hershey’s. The problem was that I could not buy directly from the manufacturers and the profit margins were super low, about 12%. I was used to up to 70% profit margins.
Finally I ran into a beverage manufacturer of an Energy Drink. They were just starting with their product and it was easier to become a distributor.
Now let me tell you a bit about Energy Drinks. Energy Drinks are the new Super Profitable products. Everybody makes money, the manufacturer, the distributor and the retailer. You see, Energy Drinks sell for $1.99 to $2.40 at the stores for 8 to 16 ounces. This is incredible if you consider that you can buy a soda that’s the same size for $0.50 to $0.75. Even a 20 ounce soda runs you about $1.25.
Distributors love the product because they make about $8 per every case they sell compared with about $2 to $4 for their other products.
Let’s get back to the Beverage Business. The great part of this business is that if you have only one customer going into the store buying your product you sell at least 1 case of that product per month.
You see; if you sell a soda someone can buy a soda every day, compared to a hammer, where people don’t buy a hammer every day. So you need fewer customers because you sell more per day.
For example: Let’s say you have only 100 stores that you service yourself and sell 3 different beverages. You sell one Energy Drink and 2 Sodas. You make $8 from every case of the Energy Drink and $3 from every case of soda.
If you sell only 1 case of the Energy Drink per week per store and 3 cases of each soda you’ll make about $600 profit from the sodas per week and another $800 profit per week from the Energy Drink. That’s $5,600 profit per month with only 100 stores and only 3 different products. It’s very easy to ramp up to 5 or even 8 products. This is why I love the beverage business.
Now let me tell you a bit more about Energy Drinks. They are the category that is growing the fastest of any other drink. It grows up to 70% per year in the US compared with 2% growth for soda. Companies are still growing from 100% to 300% per year every single year. The best part is that there is no end in sight.
Not only that, the Energy Drink Business is incredibly fun. You get advertising and promotion from companies, you get to do club and store promotions, get t-shirts, hats, gifts, extra commissions and free product from the Energy Drink companies. You also get free racks, coolers, sometimes even refrigerators.
How to Start a Wholesale Distribution Business from Scratch
Have you ever thought of starting a wholesale distribution business? Maybe you're ready for a new challenge or have realized the profits that you can make when you deal with larger quantities of product. In any case, you need to know what to do in order to be successful.
The first thing that you want to do is choose the products that you will be selling to retailers. You may want to choose products that you already know something about in order to use that expertise to choose quality products that you can then sell and make profit from. Make sure that you are testing the products prior to purchasing larger quantities. You want to be sure that you are always selling a superior product.
These products will need to be stored somewhere, so choosing a warehouse is the next step in your wholesale business. You need to choose an area that is both secure and easy to manage. You might want to consider renting a space or using your own facilities if they are large enough. Determine how much the cost of the warehouse will be in terms of square footage and make sure that you are comparing multiple warehouses to ensure that you're getting the best deal.
You might also want to consider setting up your warehouse in one of the southwestern states in the U.S. as this will allow you to be accessible more easily from Mexico or South America – where manufacturing is expected to skyrocket in the next few years. This will not only be more efficient, but it can also cut down your distribution costs.
To start off right, you will want to create a system that will allow you to monitor the progress of your products from the manufacturer all the way to the customers. This can be called an order flow system. To build an effective strategy in these areas, you will want to coordinate product movement within the warehouse as well as the movements into the warehouse. This can be achieved through the use of computer systems that monitor package label numbers.
You will also want to establish a working system of moving the products from the trucks into your warehouse – without damaging anything along the way. Try to envision how the shipments will come in to determine where you will need to set up inventory lists for double checking the incoming products as well as areas for products to be packed and sent to customers.
And since money is truly everything in business, you will want to establish yourself as a competitive wholesaler by offering something that your competitors do not: easy payment terms for buyers. By allowing your customers the ability to extend their payments or have higher credit limits, you will show how your services might be the better choice for their needs.
If you're able, you might want to consider looking at other wholesaler businesses to see if there are any tips that you might want to consider along the way. Talk with the owners to see if you can meet with them to ask about setting up and maintaining your business. If you find another wholesaler that distributes different products than you do, you may be able to help each other successful as well.
Jorge Olson is a consultant, speaker and entrepreneur and owns several Wholesale Distribution companies. Learn how to start your wholesale distribution business from scratch at http://www.DistributionBusiness.com
Internet Marketing: Your Website Is Not Selling Because You Only Have One Website
Internet Marketing is one of the best forms of sales and marketing available today. It does not matter if you are a small company or a Fortune 10 company. Internet Marketing will help you get more leads than you know what to do with, sell more of your products and services, make better relationships, stay in touch with existing customers and so much more.
Most people draw a blank when it comes to Internet Marketing. Even high level executives, like CEO's and VP's of Marketing, are not sure what it is or how it really works or what they can get from it. Many think it's just internet optimization, others that it is internet advertising. It is both, and more...
Internet Marketing is now the most powerful tool at your disposal for marketing. It has everything traditional marketing has plus more and for less money. Here are some of the weapons available in your internet marketing arsenal:
. Direct Mail . Target Advertising . Lead Management . Newsletters . Customer Management . Marketing Communications . Public Relations . Catalogs . Direct Sales . Hard Sales . One on One real time communication . Target Marketing . Segmentation . Branding . Product and Services Directories
These bullet points are just a few of the possibilities available with Online Marketing. Each point has enough information to write a whole book on the subject.
To start understanding the power of Internet Marketing you have to get away from several old notions and stereotypes about online marketing. One of those notions is your Main Website. Most people and companies have their home page and that's all they have. It is the symbol of corporate identity and their #1 form of communication online, or so they think. In reality most people will only visit your website when they are looking for you and only you. In rare cases will they find you if they are looking for your competition or the products and services you provide. Most companies, unless someone searches for them under their exact name or website, will never be found.
The reality is that even if someone looks for your products and services they will not find you. If you are lucky and good, a small portion will find you. The first step that you need to take to have a larger presence online is to create more Web Pages. Simple, right? Yes, actually. The problem is most people don't realize this simple fact. Now, how powerful is this idea? Well, imagine that you have 5 buildings or offices around your city, state, or country. Now imagine you have 10, 20, or 30 offices. How many more customers would you attract because you have more offices, more real-estate, more presence? It is the same concept online. The more websites you have the more business you will generate.
Your websites should not be all carbon copies of one another. They should all be different, all targeted, all packed with useful, up to date information.
These websites will generate more leads than your main website because they are targeted. For example, if you sell desktop software like Windows, ACT or Photoshop you would not create 3 websites selling all 3 software. On the contrary, you would create 3 websites selling each product individually. The websites would be targeted to that single product. For example, the ACT software is a sales management software so the website would have sales and marketing links and articles, tips on how to use ACT and even case studies of companies using the product.
Why would this ACT software website be successful? Think about it, if you are looking for this type of software online or any type of sales or marketing software and you find this site packed with information, what will you do? Most likely you will stay there and read more information, hopefully even bookmark the page and recommend it to others. This makes the website a real Marketing Website.
Jorge Olson is a Marketing Consultant and business owner. He’s been a successful VP of Marketing and CEO for several companies and now helps others with their marketing strategies. You can find his strategies, articles, and even his marketing plan at http://www.ShotgunMarketing.com
The Structure of Marketing... Advanced Strategies to Help You Sell
Before we start discussing the Wonderful World of Marketing I would like to share an idea with you. Well, this is more of a principle than an idea. It's the principle of the structure of Marketing primarily the broad definition of Marketing and how it applies to small businesses as well as Fortune 500 enterprises.
The idea for this issue was bouncing around in my mind for more than 10 years after a conversation I had with a software company where I was serving as the VP of Business Development. The conversation was around business planning and Marketing.
We were developing the business plan and the subject of the day was Sales and Marketing, especially the hires and structure of the departments. The CEO that I was talking with was an ex Big Business (Fortune 500) executive with an old fashion look on business planning and Marketing. We got a bit stuck on what was marketing and how we would structure the departments.
The problem was simple. The CEO wanted to have a Marketing Department and a Sales department. He wanted them to be different cost centers, different departments running independently from one another. I wanted to have one department working together under one cost center. I thought the concept was simple and the decision very easy. I was wrong, very wrong.
What I considered a very easy decision stretched into an argument. I really did not understand what the problem was. After all, isn't Sales a part of Marketing? Isn't Marketing a Universal Term that explains how to "Market" products and services? How to place products and services out in the world? Isn't Sales just one part of that whole process? Well, as it turns out not many people know this and not many people see it this way.
For some reason, businesses, tradition, bosses, schools, have separated the sales from the marketing although in definition sales is just one part of marketing and if the whole marketing strategy is done correctly the sales is the easy part.
I can see the dilemma, after all, how do you teach sales at school to university students? I remember when I was in school Sales was a bad word. Nobody said "I'm majoring in Sales" or "I want to be a salesperson when I graduate". This is without realizing that everything in the real word is about sales, from your resume to your interviews, raises, promotions, owning your business, asking for investment or loans, everything.
Is there a practical business solution? Yes, education. Understanding marketing and what it is and how to use it is the name of the game. And creating a solid marketing plan and department capable of unifying sales and marketing is the goal. This will make sales a part of marketing and salespeople will love you for it. After all you will make their life easy by applying killer marketing techniques to help them close more sales and be more profitable. To do this you have to become a marketing expert, everything you do is marketing, the way you deal with employees, customers, investors, the bank, suppliers, everything.
What is your homework? Study marketing and everything that has to do with the subject including sales, public relations, product development, distribution, merchandising, packaging, everything. You will be surprised by the knowledge you gather and the profits you make.
Jorge Olson is the creator or Shotgun Marketing, he’s an ex VP of Marketing and veteran CEO and owner of several companies. He's now a Marketing Consultant and ownes several companies and sits in several boards of directors. Find his strategies at http://www.ShotgunMarketing.com
Wholesale Myth: Do I Need A Business License Or Tax ID?
One of the myths that are still prevailing in the wholesale business is the business license and tax I.D need in order to achieve wholesale success. It is a big mistake to get such an opinion as a fact and then making such message viral all across the Internet.
First of all getting a business license I.D is truly necessary is a true necessary step to make when you plan to incorporate your wholesale or reselling business. In my advance wholesale business opinion, it is important to get a business license if you plan to sell one hundred thousand dollars a month in sales from a retail, wholesale or reselling business. However, there is no need to get a business license when there are many wholesalers and distributors that can cut you deals for wholesale merchandise in single or in bulk amounts legally.
There are different laws that regulate the reselling and wholesale business in many states in the USA, however, that is not an implication that you need a business license to sell wholesale merchandise.
For example: Check out "Maxam Wholesale" online wholesaler, such wholesale giant has been around for decades and they don’t require you to have a business license or tax id in order to resell there wholesale merchandise.
Most of the wholesalers that have a website require you to enter a tax identification number, business license or both. One of the techniques I use to eliminate this kind of hassles to immediately establish a business relationship with them is to call them directly at the phone given in their website.
I then immediately notify the wholesaler that I am highly interest in knowing the wholesale prices of such products they have in their catalog in order to have an instant buying conclusion for making business with them today.
More than 90% of the time they will send you their wholesale catalog through the mail or they will give you a username and password to access the prices in their site for immediate business. Once you have access such site and notify your objective with them, you can start buying directly from the wholesaler or distributor online and by phone without owning a business license or tax identification number.
Joaquin Reveron is a wholesale business consultant for many rising small businesses and marketing advisor for online and offline wholesale purchases. A Wholesale List is one of the topics being discussed at http://www.videogamesmystery.com .
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