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7 Skills You Need to Run a
Wholesale Distribution Business

See also: Organising Skills

Wholesale distribution, as the name suggests, is the sale of merchandise and goods to industrial, commercial, institutional or other professional business users; to retailers; or to other wholesalers. In general, it is just the sale of goods to anyone other than a standard consumer.

A wholesale distribution business is a company or a group of people, preferably referred to as the wholesale distributor, which buys products in bulk from the manufacturers only to redistribute the products, most commonly to retailers. In the supply chain of a wholesale distribution business, the manufacturer, the wholesale distributor, and retailers play the key role to maintain a flow in the system.

The big idea behind wholesale distribution is buying high-demand products at a relatively low price and in bulk quantities. By purchasing the products in huge volume, the wholesale distributors can crack a great deal from the manufacturers, who, in most cases, do not have the bandwidth or the resources to sell their products in sizeable proportions. Instead of investing their time, money and effort in trying to sell their products independently, they favor reaching out to the wholesale distribution companies who can buy their products in volume in exchange for a good price.

The modern-day wholesale distribution business has evolved over the years. Today it is about working in a business-to-business realm by selling your product to independent retailers, retail companies and other wholesale firms. As a wholesale distributor, you will perhaps run an independently owned and operated firm that buys and sells products of which you take ownership.

A prominent and relevant example of a wholesale distribution business is the US-based company, Quicklotz.com, which has connections with retailers at verified and trusted organizations. With the products sold off in bulk, the cost price drops. It is at this low cost that Quicklotz makes its products available to the buyers in the market.

As a wholesale distributor, you know that the order volumes are massive. By building into your business the features that give your customers the convenience that they want, you can ensure long-term success.


Mentioned below are 7 remunerative skills one requires to run a wholesale distribution business successfully:

1. Institute a credit policy

For running a wholesale distribution business successfully, it is not only important to establish a competitive credit policy, but also to stick to it. Avoid overextending credit to customers and allowing one customer to owe too large a percentage of your receivables, leaving you overexposed. Make clear buyer-seller boundaries and look at every situation in the business from a professional outlook.

Establish firm payment terms and credit limits, being very clear and diligent in explaining your terms and checking credit references for new customers, reviewing your customers’ accounts biannually, and adhering to your terms and conditions.

2. Monitor cash flow regularly

Without good cash flow management, running the business would be too hectic for you. In order to have a smooth and uninterrupted business flow you must manage your cash flow from the start. You need to know every cent you make and that you spend, and schedule paying your bills in a timely manner. It is equally important to keep a track and be careful in handling your receivables by ensuring that you get paid on time.

Understand the financial circumstances of your business so that you can make a call on when to invest and when to re-order goods. To start understanding the financial condition of your company, create detailed cash flow statements on a daily basis.

3. Keep inventory under control

There are several aspects of successful inventory management, the first of which is maintaining just sufficient goods. Even though it is your job to sell your products in volumes, holding too much inventory in hand is not good for your business finances.

You have to pay attention to inventory calculations such as recorder levels, lead times, and security of your stock to ensure that you do not keep any stock beyond your need or in vain. Using a good inventory management system can help you track your orders across channels much more effectively.



4. B2B e-commerce

In the digital age, e-commerce for B2B sales is growing at an unprecedented rate. Over the years there has been a massive growth of e-commerce in every possible retail sub-sector. There is also an increase in the shift of the number of buyers to their wholesale distributor’s website to make purchases and transactions, as B2B customers prefer the simplicity that comes along with online mode.

More elaborately speaking, B2B customers favor the secure transactions, a digital trail, and the ease of browsing and buying products on an e-commerce store, thus driving the sales of the wholesale distribution company.

5. Stop managing orders manually

Too many wholesale distributors are still taking down orders on antiquated clipboards and paper order forms, even in this digital age. Some have opted and taken a half-step towards using technology with PDF order forms and Excel spreadsheets. However, these methods are equally clumsy, if not more so, as paper.

With the advancement of technology, many successful businesses are taking advantage of mobile order writing technology, giving the sales representatives access to customer information, product catalogs, and an order writing interface right on their device (that is, smartphones, tablets, laptops, etc.).

6. Compete on customer service

As a wholesale distributor, you can offer outstanding discounts on products that make your offer more lucrative. But in the present-day scenario of intensely competitive B2B sales environment, competing on price can prove to be risky for your business and it is only a matter of seconds before some other company comes along with better discount offers.

Therefore, instead of reducing your price offering, compete on customer service and satisfaction. Make extra efforts in tracking and noting your order history and keep sending alerts to your customers systematically to encourage them to repeat purchase from you.

7. Customer-seller relationship

One of the other significant skills for running the wholesale distribution business is to build a healthy customer-seller relationship because lasting relationship brings in a long-term business possibility. There must be a transparency maintained between both the parties to ensure there is no breach of trust.

Have a free flow of communication with your customers about the new products and other offers on B2B. If there are changes in your policies, ensure that a written update goes out to all your customers. You may use email marketing or a newsletter that provides useful information every month, thereby building the recall value.


In any emerging market, the need for distributors increases with a rise in demand for the product, making product distribution thoroughly lucrative. On the other side of every new trend is a team of wholesale distributors hard at work to find quality manufacturers and help them bring their products to retail.

With the effective use of these operational and management skills, you can run your wholesale distribution business successfully.


About the Author


Anirban is a working professional at a multinational company. He is passionate about writing and contributes to various blogs and websites. He has a background in Business & Marketing and is motivated to share his ideas based on experience and research to help others.

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