Starting a wholesale business, or adding wholesale operations to your existing retail operations, can be a beautiful thing. A wholesale business gives you the ability to bridge the gap between manufacturers and retail operations, letting you work within the supply chain.
How should you get started in the wholesale business? All it takes is a little bit (ok a lot) of planning - starting with the business plan.
First off, what's a wholesale business plan anyway?
A wholesale business plan outlines what you intend to do as a business and introduces anyone who's interested to key people involved, as well as the roles they will play in making your company a success.
This B2B plan also spells out the strategies you will use to make your wholesale business a success, both in terms of marketing and the actual financial management of the company.
Why is it important?
Having a business plan for your wholesale company is important for several big reasons:
- First, it's essential to get funding and investments. It specifies how much money you need to get off the ground and explains how that money will be used to make your company a success.
- It explains your passion for your business concept and brings that passion to life with stories, examples, statistics and forecasts.
- It illustrates the proof of demand for your business idea and demonstrates market research.
What should your plan include?
Writing a wholesale business plan is like preparing a road map for your company. It provides direction to your staff and explains your strategy to potential investors and partners. Every wholesale business plan needs these 9 sections:
1. Executive Summary
This section provides a snapshot of your company and acts like a synopsis of your entire business plan. Aim for one to two pages and write this section last.
2. What Does Your Company Do?
Make sure you provide a description of what your company will actually do. You will want to explain what your company does and how it will operate as well as why your company is unique.
3. Who Will Run Your Company?
Next, include a section that introduces the key players in your company and why they have the skills necessary to make your company a success in their respective roles. You should also explain a bit about how your company will be managed and the structure of the organization.
4. What Does the Market Look Like?
Once the reader understands what you do and who is doing it, you will want to explain the market research and analysis you have completed. This serves two purposes: it explains your train of thought as to the opportunity you see and it shows the reader that you have researched your concept.
5. How Does Your Company Fit In?
After explaining the market in which your company will operate, you will need to outline how your company will harness the opportunity you have identified. This section should include information about the products you will sell, your target client, and how you selling these products will benefit them. It is all about addressing a specific and quantifiable need.
6. How Will Your Company Get Clients?
This section outlines your sales and marketing strategy. Include information about how you will attract clients and the maker in which you will sell to them. It should encompass your sales structure as well as any marketing.
7. What Do You Need to be Successful?
Next, explain what you need to be successful. If you need financing, this is where you ask for it and explain what you could with extra financing.
8. How Do You See Your Company Being Successful?
In this section, include your financial projections as to how your company will generate a profit and when that would occur. You should include a break-even analysis as well as how you expect your business to become profitable and when.
The exact requirements may vary depending on where you are seeking funding but, in general, you will want to focus on cash flow, providing a one-year and a five-year projection at a minimum. You may also want to include scenario analysis to demonstrate what will happen if your forecasts are off, providing a worst-case scenario and a best-case scenario based on your market research. You can summarize your research in this section, but be sure to explain your projections and any assumptions you've made.
The last section is where you include the specifics, such as resumes for your the key players at your company, drawings of your building, a detailed analysis and complete financial projections.
Dos and Don't's for writing your plan
- DO be specific and back everything up with numbers
- DO provide comparable so that your reader can easily see how your concept will work.'
- DO bring your research to life with stories and examples. Tell a story.
- DON'T rely too much on words. Visuals are your friend. Use graphics, charts and images wherever possible and relevant.
- DON'T focus too much on the product you are selling. Business plans are for explaining how your company will work and why it will be a success - not selling your product.
- DON'T use generic research. It is much more impactful to say that you've surveyed 40 local business owners about your specific, local market than that your entire industry is growing at a specific rate.
Get to writing!
There are many great resources out there for writing your business plan. Talk to your local Small Business Association (SBA) or chamber of commerce to grab some free advice or check out resources online. Once you've got the basics down, it's all a matter of putting pen to paper and writing out your roadmap for a successful B2B business!