Exit Planning for Your Wholesale Business

While your day-to-day focus is on growing and building your business – taking care of your customers, fulfilling their needs and creating demand for your products, exit planning may seem like a distant requirement.

We’d argue that exit planning is actually a vital part of your business plan, helping you work towards a successful sale or legacy. Taking that approach, your business will only truly be sellable if you are building value, ongoing. As a wholesaler, you’ll have unique challenges, but also some great opportunities.

Embrace Technology

The wholesaling and distribution market has changed exponentially, and technology is driving a lot of these changes. Wholesaling is becoming increasingly digitised, with technology impacting logistics, stock control and even customer communication so it’s important to keep aware of the changes.

Advancements in supply chain technologies can help you improve efficiency, reduce waste and streamline your inventory. Research the various software packages and consider it an investment in the long run. Increasing energy and commodity costs are squeezing margins, so better control of your inventory can reduce costs.

Consider also how technology can help you extend your market reach in new areas. Wholesalers are no longer beheld to functional boundaries and you can now consider expanding into geographies previously impenetrable for practical reasons.

Encourage Loyalty

These advancements in technology can also mean the risk of increased competition, so it’s imperative to find new ways of demonstrating value to your customers.

As the industry moves forward and customers find it easier to switch between suppliers, customer service and loyalty come under more pressure and may change, even if product brand loyalty remains.

• Take advantage of your customers’ mobile behaviour. Today’s customers are on the go, using their mobile phones to shop, so it’s worth investing in making sure your website and business are mobile friendly.
• Use technology to communicate with your customers – wholesalers who can adapt to the modern customer’s desire to communicate will be ahead of the pack.

Your Exit Plan

When it comes to exiting your business, whether you want to sell to an external buyer, transfer ownership to family or a trusted management team or reduce your involvement in day-to-day operations on a staggered basis, you’ll need to have built a business that is valuable, stable and able to respond to the exponential changes in the market.

Only then will you be in a solid position to get the price you want.