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Starting a distribution business can be exciting if you know how to manage it. There is no doubt that it is one of the most productive trades on the list, and there are many entrepreneurs who are interested in starting this business.

Essentially, your role as a ‘distributor’ is to act as a middleman between manufacturer and retail shop owners. However, there are some cases where distributors sell directly to consumers as well. Initially and without any structured system in hand, You may find it difficult to keep jumping between producers and retail traders, but if you work well and hold all the threads firmly, then it is not so hard as well.

If you are thinking of entering into this industry, then this article on ‘How to start a Distribution Business’ will help to kick off your journey. Here are the things given in this list that you should consider before starting.

Factors that should be considered before starting a distribution business:

A distribution business needs proper market research, a viable implementation plan, and other key things to consider if one wishes to start a business. Here are the essential items to consider:

Making a good business plan  

A good plan is half of the battle. Making a proper plan before starting a distribution business will save not only time but also money. A good business plan integrates the business strategy and vision while addressing all the issues. It is less likely to fail if the business plan identifies the challenges as early as possible, sorts them before they become a pain in the neck, and helps to create a smooth business journey minimizing the risks in the journey.  

Choosing a product/Figuring out what to sell

Many products are available in the market, but you should choose the one already in demand or is expected to increase in demand in the near future. While running the business, you obviously want to make a profit; when selecting a product, you should carefully measure how much profit you can make from it. To make the business viable, following the core principle of trading business, you must buy products at a lower price and sell them at a higher price. Analyzing a competitive scenario of that relevant industry and other complementary products is also a must. So, figuring out what to sell is an extremely critical decision that you must take rightly.

Competition analysis

After selecting a product at the initial stage, the next step is to filter the business idea through various processes in order to analyze the competition. The purpose of a competitive analysis is to find current and future competitors and identify their strengths and weaknesses (compared to your position in the market), and observe how they are approaching the market.

Upon proper analysis, you can ascertain the possibilities of effectively outranking your competitors. It may include estimating what is needed to make a significant push in the market regarding money, resources and strategies.

Looking for the right business partner/Investor

To create a successful business, you better have a trusted partner who shares the same spirit and commitment as yours. It will greatly reduce the pressure of managing a business from a single end. It will also facilitate the flow of new strategies that will come up by sharing ideas. On the other side, having one or more business partners can significantly reduce the initial investment or capital required to start and operate the business.

It is also important to keep in mind that an investing partner can only be attracted if the business model can clearly show ways of managing it profitably. So after finding a profitable product and doing an in-depth competition analysis, you can offer or share your business idea to attract people as operating or investors partners.

Overcoming Implementation challenges

After the planning stage, you need to develop a beautiful implementation plan to execute the goals outlined in the initial stage. In the implementation stage, you will fight those identified challenges and start cutting your path to success. Needless to say, many more unpredicted challenges will appear on the way. So you need to stand firm, keep your focus on growth, and keep moving forward, breaking all the obstacles.

Making a proper marketing plan

A realistic but ambitious marketing plan will surely serve as one of the crucial success factors for your business. Many businesses fail due to a lack of a proper marketing plan or failure to execute as per plan. However, it has become much easier to reach customers in today’s technological world and get them aware of your product and service.

Nowadays, online digital marketing has mostly taken over the space of old-fashioned physical marketing. That’s why it’s good to have a specifically targeted marketing plan at the beginning of the business in order to implement it by creating a beautiful blend of online and offline marketing; centered on the target audience of the product.

Managing inventory

One of the core challenges of implementing a distribution business is managing the warehouse properly and delivering products to the proper retail shops or locations. The more delivery points a business has, the more challenging it becomes to manage the warehouse. You, as a distributor, have to keep an accurate account of the product flow that is coming from the manufacturer and is delivered to the retailers. At the same time, you have to keep track of the returned products coming back from the retailers to the warehouse.

To manage all of these channels a proper distribution management software is necessary. With the help of such software, organizations can manage inventory and deliver products without any hassle. You can use a suitable distribution management software system to manage the warehouse, which will allow you to bring all the warehouse accounts and retailers in one place and get accurate data.

Securing the Sale Price

You need to make sure that you are making the product more competitively priced so that you do not lose out to the competition. There is no general rule regarding profits since each product and industry is different; find a competitive price depending on the supply chain and industry analysis.

Recommendations

1) Don’t take it lightly

Do a comprehensive analysis of the market, your competitors, distribution channels, and everything that may affect your business operation in the future.

2) Keep your mind open

Be willing to accept the reality of the market you are trying to reach out to. Although you may be doing well in your current market/ industry/ business, keep in mind that you are likely to be a stranger in your new market. Embrace the local business knowledge by letting go of your ego.

3) Start small

It’s not practical to cover an entire country or region in one shot. Begin small, measure, test, and then expand slowly. Plan for a pilot test and a field validation. Make a small-scale test of your strategy.

4) Look for third parties

To start a business in a new market, what should you do? A solo trip or accompanied one? It depends. If you have the full capacity for distribution, coverage and knowledge of the market, direct penetration may be an option. If these options are not available, and in most cases, it is better to include a third party that knows the market while reducing financial risks.

5) Don’t neglect your current operations

Getting caught up in the moment makes it very easy for one to lose focus. Usually, what is new is more attractive than what we are doing currently. Keep in mind that your current operation, brands, and products are what generate cash for new projects, especially while scaling up your business.

Summarizing and wrapping up:

Starting a distribution business is a mix of challenges and opportunities. Managing the retail channel is a tricky thing when you are new in the business. In order to maximize sales, a business needs to study its distribution network and business strategy, evaluating its products, distribution capacities, and strategies.

Sokrio Distribution Management System is a mobile and web-based application that brings your entire retail sales channel to the palm of your hand. This software will facilitate the overall inventory management of your organization, and increase the productivity of the sales channel by tracking the performance of your field sales team.

Here are some descriptions and advantages of the best unique features of Sokrio DMS to create more accountability from the field sales team.

Features that will create more accountability from field sales team

GPS Tracking

GPS tracking is a well-known means of locating an employee. Sokrio DMS tracks the user’s location with the help of GPS and gives you a real-time update of the person’s movement. To do that the Sokrio distribution management system uses Google’s tracking directory. By using Google’s tracking directory Sokrio DMS is able to give you accurate results on the location of field workers. This allows you to easily track the location of your field staff from anywhere at any time.

Core benefits:

Uninterrupted employee tracking facility

Provides you accurate locations of the field workers by using Google tracking directory

Know the status of employees from anywhere to anytime

Proximity-based check-in

In a manually driven and less monitored sales channel, quite frequently the sales reps fabricate their daily activity reports without meeting their target number of daily outlet visits. Proximity-based check-in system of Sokrio DMS is an innovative solution designed to play a crucial role to solve this challenge. Many times a sales rep ticks off a designated outlet without physically visiting it. They can get away with this act simply by saying that the store did not place any order on that particular day, whereas the company may have missed a crucial sales opportunity of its product to its competitor. This sort of trickery is impossible to conduct by any SR while using the Sokrio Distribution Management System.

Sokrio DMS users will not be able to check-in to any particular outlet mapped in the system unless that particular device is not within 50 meters of that outlet. As a result, he must come near the outlet to give a successful ‘check-in’ and report a successful visit to the outlet. This means that you can be assured that all the visits mentioned in the daily activity report are authentic and free of any fabricated data.

Core benefits:

Confirms Sales Representative’s Outlet Visit

Completely get rid of the fabricated report about outlet visit

ensure the physical outlet  visit by Proximity-based check-in

Forces sales reps to work at mentioned  outlets in the area

GEO-Fence

An authority can have complete control over its sales channel through the Sokrio distribution management system software. An authority can determine from the Sokrio DMS software to the outlet selection to the sales representative’s route plan.

As a result, it is possible to monitor the amount of work done by a sales rep throughout the day and the area-based movement. In that case, the GEO-Fence feature of the Sokrio distribution management system is very important. When a field worker is selected for a specific area and if he works or moves outside that area, the authority will be informed about the movement of that worker through notification. It will also help to build work efficiency and honesty for an employee.

Core benefits:

Helps to develop sales representatives route plan

Guides sales representatives to work in the mentioned area

Informs the authority about the movement of field workers through notification

Helps the management  to monitor sales representatives area-based movements

Get rid of the fabricated report about the mentioned area visit from sales representatives

Build work efficiency

Use Sokrio Distribution Management System to manage your sales pipeline smoothly. It will bring up to 33% efficiency in your sales channel.

Mobile battery strength notification

Sokrio DMS software has worked perfectly to monitor all the activities of your sales channel and has come up with a variety of unique features. Many times salespeople cut off their communication with management at some point in the day because they do not have sufficient battery power backup. Not having enough battery power is a very common excuse for sales reps. As a result, the productivity of your sales distribution channels continues to decline. In such a situation, the mobile battery strength notification feature of the Sokrio DMS will play a very useful role. By giving such an excuse they usually get disconnected from the system after a particular time of the day.

As a result, the productivity and accountability of your distribution sales channel tends to decline. Sokrio mobile battery status notification feature is capable of playing an excellent role in solving this challenge. The Mobile Battery Status Notification feature will notify the authority of the amount of battery charge left of a particular user’s mobile at his last tracked position.  This will enable you to easily identify the validity of the excuse and also the battery status of the  phone.

Core benefits:

Provides uninterrupted communication between the sales representative and management

Displays the battery strength of Sales Rep’s mobile by notification

bounds the field worker to maintain an unbroken connection with the system

Get rid of valueless excuses about battery strength  

Helps to improve productivity

Sokrio off-line unique features

Can’t find your field staff active online?

Relax, the unimaginable offline features of Sokrio DMS help sales representatives to work seamlessly without the Internet. As a result, the accountability of your field staff increases dramatically.

In the article “The best unique features of Sokrio DMS to make the work of your sales representative easier and faster” we have already described Sokrio DMS’s offline unique features. The Sokrio DMS has unique features like offline selfie check-in and offline order collection that will make your sales team’s work easier as well as increase their accountability.

Several times a sales rep manages his outlet visit report manually, by saying that his phone has no internet connection or network which is very challenging for the management to monitor. However, using Sokrio DMS offline selfie check-in, it is possible to get rid of this kind of trick very easily. If ever Sokrio DMS users do not have an internet connection then they can complete their outlet visit through a selfie in front of their designated outlet by using the offline selfie check-in feature.

Like offline selfie check-in, Offline Order Collection is an incredible feature of Sokrio DMS that can increase your sales team accountability by up to 50%. As the name suggests, it also works without an internet connection. The Offline Order Collection feature allows employees to collect orders offline all day. All the order information gets automatically uploaded into the system as soon as the device gets into the internet range. The uploaded information then becomes visible at the Sokrio DMS’s web-based dashboard.

Core benefits:

No need for any kind  of internet while using this feature

100% scheduled outlet visit and orders collection confirmation

Get rid of the fabricated report from the sales team

Gain relief from the hassle of collecting daily scheduled orders

We have already informed you how Sokrio DMS makes the work of your sales representative easier and faster. I have also explained how to create more accountability from the field sales team by the best unique features of the Sokrio distribution management system.

Now it’s time to present you Sokrio DMS’s Best unique features to Track and Monitor your Sales representatives  Performance.