New business advice -distributors-

H

HelpIRL

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Starting a new business and need some advice on approaching distributors .

Can I just ring them up and ask straight out for there trade price list? If I want a credit account will they do a credit check on me ?? Would a distributor give you a credit account straight away or would you want to be trading with them for a while before even asking? Has anyone any advice on approaching a distributor in general and getting the best deal, can you haggle with them ?

Thanks in advance!
 
If you are buying for resale or distribution, discount is generally around 35% - perhaps a little more if you buy in volumes and probably less if you're only buying occasionally or in low value orders. They will expect to know your background, experience, marketing/sales/promotional plans etc - you have to demonstrate that you will be an appropriate agent.

Credit can largely depend on the type of company and the country they are from, but trade references will be required regardless and the first few transactions will probably be via proforma invoice - ie. payment in advance.
 
thnks for that. Would the distributor want to know my background before giving me access to the trade prices ? And the trade reference who would i get to give me one of those a customer or another distributor? What dose a trade reference tell the distributor about me?
 
HelpIRL said:
Would the distributor want to know my background before giving me access to the trade prices ?
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Not necessarily, I think they would provide pricing info fairly readily.

And the trade reference who would i get to give me one of those a customer or another distributor?
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Generally someone who supplies to you, someone you pay.

What dose a trade reference tell the distributor about me?
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It's just a rough way of establishing whether or not you pay within credit terms etc - not much other info. is requested other than the usual contact details. Generally, 2 or 3 references are sought.

Actual credit check is something specific and much more detailed but it's not common that suppliers investigate to this extent in my experience.

At the end of the day, they want to supply you as quickly and easily as possible ;)
 
I have just set my own company up and i just got an account with a distributor. They were interested in my business plan and projected figures for the next three years. They were also interested in my selling margins aswell. As i bulid a relationship with them my buying costs will drop.
 
lar1973 said:
I have just set my own company up and i just got an account with a distributor. They were interested in my business plan and projected figures for the next three years. They were also interested in my selling margins aswell. As i bulid a relationship with them my buying costs will drop.
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can i ask how did u first contact ur suppliers
 
lar1973 said:
I have just set my own company up and i just got an account with a distributor. They were interested in my business plan and projected figures for the next three years. They were also interested in my selling margins aswell. As i bulid a relationship with them my buying costs will drop.
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Why on earth would you give that sort of info to a supplier?
What's to stop them selling direct to your customers?
 
Purple said:
Why on earth would you give that sort of info to a supplier?
What's to stop them selling direct to your customers?
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Distributorship usually involves this, it's quite common.
If you were a supplier would you hand over a paticular sales territory to anyone without seeing their sales projections , track record and profit margins?
 
A company I am involved in is the Irish distributor for a number of multinational manufacturers. There is no way I would share customer information, margins above their list price discount or future plans that are not directly related to their product range. They can look at our published accounts and the amount of money we make/ would make for them.
 
For me to get a account with the wholesale distibutor they are the details they require and they only sell to trade . If you want to send me PM i will give you details if it helps.
 
Distributors in my sector can look for anything from 30 - 50% of the TRADE price and usually want exclusivity in the sales territory so you can see why the manufacturer would want to choose his distributor carefully otherwise he might get locked into a contract with someone who only buys a small quantity.




Purple said:
A company I am involved in is the Irish distributor for a number of multinational manufacturers. There is no way I would share customer information, margins above their list price discount or future plans that are not directly related to their product range. They can look at our published accounts and the amount of money we make/ would make for them.
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euro2000 said:
Distributors in my sector can look for anything from 30 - 50% of the TRADE price and usually want exclusivity in the sales territory so you can see why the manufacturer would want to choose his distributor carefully otherwise he might get locked into a contract with someone who only buys a small quantity.
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The company I am involved with (not my main business) sells goods to business users. They can buy from any distributor in the world so area exclusive agreements are not worth much. The other thing we have to watch for is other major distributors targeting Ireland though internet marketing etc. Stopping them from doing so is not possible as long as they are within the single market.
I agree that the manufacturer needs to have confidence in their distributor but we are a well-established company and brand within the Irish (and increasingly international) market so we can be choosy about what we tell them.
 
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