May 11th, 2017 | By: Natashia Fox | Tags: Success, Lessons, Advisors, Mentorship & Coaching
Every business is different yet what makes a successful wholesale distribution business in 2017 is the same no matter what products you sell. Cash flow planning, sales and inventory management and planning are key areas every B2B wholesale distribution business should be focusing on.
Here are 8 tips for running a successful wholesale distribution business in 2017.
Money in vs money out is a basic concept of cash flow, the tricky part is when cash is tied up in stock in your warehouse. It gets really complicated to forecast what will be sold, what to purchase and making sure monthly overheads are covered. This is a very delicate balancing act that could make or send any successful business into a downward spiral with one bad decision, such as over-ordering one item that becomes dead stock.
Here are a few tips on Cash flow management:
Tip 1 : Follow up on outstanding payments, follow up on time line and procedure with pre-drafted follow ups emails and calls.
Tip 2 : Be diligent about collecting payments. Know what is outstanding and follow up daily with a friendly follow up email or call.
Tip 3: Know your financial position daily. Know what needs to be paid when, what cash is coming in when and what is allocated for replacement of stock and when to order.
While it might seem like an obvious tip, too many business often fail to put in the effort to know their customers. Build a profile on each customer, know where they heard about you, what their business is about and what their needs are. This information will give you a clearer idea of how your business can better serve your customer in future, like in deciding when to introduce a new line. Keep a history on each customer and build their profile, avoid dependence on key staff dealing with customers. Give the entire team access to customer information.
Inventory could become a nightmare to manage without a great system that’s easy to use. You cannot run a profitable B2B wholesale distribution business if you don’t have a good handle on inventory.
Here are a few tips on Inventory management:
Tip 1 : Double up on tracking items in and out.
Tip 2 : Track and update stock levels items on invoices and physically when they are pick n packed.
Tip 3 : Keep a accurate stock level at all times.
When a item physically leaves the warehouse it must be recorded, by updating with a pick-n-packing list, having someone double check know as a checker and updating stock only once it physically leaves the warehouse . Using a bar code scanner to avoid human error is even more effective.
Tip 4 : Do not rely on your accounting system, to keep track of stock by invoices. Using your accounting software to keep track of stock levels is not advised.
Time to go digital and automate as many daily tasks as possible. Avoid any customers falling through the cracks. In today’s age of technology is simply no reason not be using a cloud based system to automate tasks. Companies need to move away from cumbersome methods like using excel spreadsheets or paper forms.
Acquiring new customers is expensive. Marketing is one of the biggest overheads in running a business in 2017. Retaining customers should be your companies number one priority. Once they at your door don’t make the mistake of losing customers due to lack of effort, a delay in getting back to quickly then not following up after the initial communication with them even when you don’t hear back from them after 3 follow ups. And not continuing building a relationship after they ordered is a huge opportunity missed.
We have all experienced contacting a company via their website or sending them an email and only hearing back 2 days later, by then we have most likely already solved our need with another solution even if it wasn’t the best or cheapest. Businesses need to know that we live in a age where HYPER convenience and instant gratification is a real factor for customers when making a purchase. Customers don’t wait around.
First to serve them, usually wins.
That old saying “under promise and over deliver”, holds true in 2017 as it still works like charm to impress customers. If your orders process is taking too long it’s failing your company and your customer even before the delivery is made. Make sure your orders process is automated and easy to use.
As companies grow and their customer volumes increase they lose the personal touch. Once a customers feels like they one in a thousand and treated that way, they will start looking else where to get their needs met. We have all heard the term “DISRUPTIVE” businesses, this is the basic concept businesses are reshaping who survives and who goes under.
I have written an article on this topic because I am subject matter expert, a experienced business owner of a import and distribution company and the co-founder of Ploiter Business Software System. All of the phases above are applied in one cloud based system on the Ploiter system.
Natashia Fox is the founder and lead developer of Ploiter. Ploiter started as a system for her import and distribution company, but grew into a product which can help other businesses. Twitter: @Ploiter_on
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