In this fast-paced world, wholesaling has taken a drastic turn. No more would you have to rely on pen and paper as businesses shift to the electronic medium. However, small businesses make rookie mistakes that can cost them heavily in the future. Therefore, you must make your business flexible that adapt to the capitalist environment.
See the successful wholesalers around you. As Gildan and Next Level wholesale businesses flourish, other distributors and suppliers fail due to inefficient practices. Suppliers stick to a single policy and do not change their way of business with time. Here are some mistakes you might be making that can cost you bucks!
1: Traditional Methods
You may be relying on old practices and methods. These include not digitizing your business, not advertising online, inexperienced employees, etc. Traditional methods can cost you a lot in the wrong run as they require constant investment in capital.
Small businesses remain reluctant because of the high initial costs of digitalizing their processes. They fail to understand that this is a one-time investment and does not require constant maintenance. Therefore, these businesses soon disappear from the market because of failure to embrace change.
2: Less Promotion
Just like any other business, wholesaling also needs proper promotion and advertising. Often companies overlook marketing because they think that their connections can save them. We know that word of mouth matters. However, reaching a far greater audience requires online ads.
Consequently, wholesalers do not build a website. They rely on phone calls from clients and references. It is a big NO! You must assist your customers so that they can purchase your products via an online platform.
3: Low-quality products and services
We focus on getting the money rather than maintaining quality. Again, this is a big error that even famous wholesalers and distributors make. You must never compromise on quality because you will lose even your loyal customers. Moreover, your service can also be the reason for failure. For example, you boast of giving quick delivery service, but the item takes ages to reach a customer’s doorstep!
To maintain quality, you need to invest the right way. For example, if you are in the apparel wholesale business, try to make products that cater to a wider audience.
4: Incorrect Pricing
You may be applying an incorrect pricing strategy. It means that you might be overcharging or undercharging your customers. Consequently, you will be making a lesser net income than what you are capable of. One way of ensuring an effective pricing strategy is to study your competitors and what prices they are charging on a product.
5: Not Upgrading
This point goes hand in hand with the first one. It means you are not throwing out market competitive prices and policies or failing to do so. Moreover, you are not bringing any variety to your product line. Therefore, you risk your wholesale business due to a lack of products on your shelf.
Upgradation requires putting your money on technological infrastructure. Therefore, you must have an efficient ERP and Inventory listing database that readily updates new information. Consequently, having an IT department that manages this will prove beneficial.
6: Dead Stock
You must ensure that your inventory stays empty by the time season ends. Warehouses are literally brimming with unused products that simply waste away. Therefore, know the quantity that you would need to sell out perfectly. It is because, with more products lying in your inventory, there are more chances of inventory costs going up.
You can learn from the efficient practices of Next Level wholesale business. Putting the products on seasonal sales makes their inventory empty. Therefore, it would be good if you put up deals and offered discounts on certain products to clear up inventory.
7: Inefficient Sales Rep
Your sales representatives will make or break your business. It is due to the representatives having a wrong pitching style that risks your output. Moreover, you need to properly train these representatives in techniques such as cold-calling, emailing, etc. In addition, train them on how to sound more affirmative rather than persuasive.
The best way to sound affirmative is to tell your customers the benefits of using a product rather than its features. Understand that today’s customer is intelligent and cannot be persuaded easily. Therefore, make your pitching style informative.
8: Wrong Target Market
Lastly, wholesalers tend to make every demographic their target. Again, a big mistake. Not everyone will be able to buy your product or simply want your service. Therefore, focus on those customers who will ultimately boost your sales.
One way of finding the correct target market is through surveys and questionnaires. Study the demographics of your desired area of interest and then make your products and services centered on that area.
In the end, it is all about staying sharp and up-to-date. Every business requires giving away your blood, sweat, and tears. Consequently, your business must be centered on solving the problems of the public. It could be as simple as being the right brand for a teen to purchase her prom dress or for a man to have the best tie that stands him apart from the rest!