Manufacturers make materials and products that are sold to other manufacturers and to retail businesses. Not all manufacturers manage the process of selling their goods but instead provide them at a low cost to a distributor. The distributor, sometimes known as a wholesaler, creates a business from which to sell the manufacturer's products. Because becoming a distributor will vary from industry to industry, there is not uniform route to becoming a distributor for a manufacturer. However, basic guidelines may be useful when becoming a distributor.
Establish a business. Manufacturers will need to know you have the ability to receive and distribute their products. Some may require proof that you are in business and have a storefront, showroom or warehouse from which to work.
Research the distribution requirements of manufacturers you wish to work with. Discover which manufacturers' requirements work best for your business model. Some manufacturers will require their distributors to work only with their products and possibly even purchase a distribution franchise, as in the case of many automobile manufacturers. Others may allow the business to distribute their products and similar products made by other manufacturers side-by-side.
Complete the manufacturer's application process to become its distributor. Every manufacturer will have its own application process. Some manufacturers will have proprietary training that you and your employees will be required to take. Others may simply require a completed application, proof of a business license and the purchase of an initial order along with sales materials and samples.
Build a working relationship with your manufacturer. Get to know the manufacturer's purchasing process and how the company handles returns, expedited orders, back orders and unsold product. Building a relationship with a representative inside the manufacturer's company can keep your business in the information loop regarding manufacturing issues and delays.
Comply with all federal and state regulations pertaining to the items being distributed. Some products may be labelled hazardous and should be handled according to law. For instance, paint is considered a flammable liquid. Flammable liquids have storage and handling regulations as outlined in OSHA standards that a distributor will need to follow. Most items needing special attention are marked by the manufacturer per federal regulations. Check with your state's environmental agency and federal OSHA regulations regarding items that might need extra care.
Build your distributing business. Use industry and public events and conferences, demonstrations or in-office visits to connect with potential buyers. Include any manufacturer's certifications, training or official titles on business cards, advertising and websites to build credibility with potential customers.
Stay informed about techniques, trends and legislation that could affect the industry you are distributing for. Join organisations that can help you track this kind of information. For instance, distributors of beauty products can join the National Coalition of Estheticians, Manufacturers/Distributors and Associations (NCEA). The NCEA keeps track of standards and regulations for positions within the beauty industry and supports grassroots advocacy efforts to assure products are sold and used with safety in mind.
Things you need
- Business license and permits
- Business location
- Funding to purchase manufacturer's products
- "Channel Focus: A Newsletter to Help Manufacturers and Distributors Improve Sales Performance and Profitability"; A Failure to Communicate; 2006
- "The Fundamentals of Business-to-Business Sales and Marketing"; John M. Coe; 2004
- "The Complete Idiot's Guide to Starting Your Own Business"; Edward Paulson; 2007
- "Marketing In the 21st Century: New World Marketing"; Bruce David Keillor; 2007
- Occupational Safety and Health Administration: Hazardous Materials, Flammable and Combustible Liquids