Wholesale Distribution in California and COVID-19: Challenges and Opportunities
In this time of isolation and products that are in high demand, the wholesale distribution business in California is an essential one. That means this is a time of both challenges and business opportunities. The key is to know which is which, and how they relate to your business now and in the future.
Here are a few ideas, and how you might want to look at them.
Rising Demand for Essential Products
In California as everywhere, certain essential items are in high demand, and more people than ever are socially isolated and ordering these items online. This means the readiness of the wholesale distribution industry is a critical part of the overall supply chain.
But while the law of supply and demand may mean that some of these items can be sold at a premium, customers are more aware than they ever have been of price fluctuations and people who may take advantage of the situation. With many people out of work, these essentials could quickly be out of reach.
Consumer memories are long, and what may seem like an opportunity now can turn into a harmful reputation later on. Even in times of high demand, keeping reasonable prices for your retail partners and any direct to customer sales is vital to your business future.
This rising need can offer opportunities for volume orders and for keeping your business healthy while the sale of other items may be down.
Wholesale Distribution Supply Chain Changes
The supply chain is in flux, as transportation companies make changes to meet changing demand and respond to both producers and consumers. This can be seen as a challenge to the wholesale distribution business, but it can also be an opportunity.
In these extraordinary times, efficiency is going to be more crucial than ever before, and that efficiency can carry into your business long after things return to normal. There are a number of ways for wholesale distribution businesses to cut costs and improve profits, and even automate process and transition to digital (and social distanced) methods of communication.
As the supply chain evolves to match changing times, businesses that evolve with it will find themselves in a better position to recover quickly when the time comes.
Keeping Employees Safe
Employee safety is always a part of the wholesale distribution business. This is especially true at this time. While extraordinary precautions are in place, it is a great time to look at regular precautions that can be taken to protect your employees and those they come into contact with on a regular basis.
This can include things like regular handwashing, using gloves to handle items when packaging and encouraging staff to stay home when they are sick. While especially vital now, they are never a bad idea to prevent the spread of even the common cold and other ailments.
Having these provisions in place and things like hand sanitizer stations and hand washing breaks as standard practice will keep employees healthy regardless of what is happening in the world around us. Letting your people know how much you care for their wellbeing inspires both loyalty and increased work ethic and efficiency.
Resetting Your Business Goals
Whether this is a busy time for you or a quiet one, now is a great time to reevaluate and reset your business goals. While profits may increase short term due to increased demand, that trend may not last beyond the resolution of the pandemic.
By the same standard, if your sales in other areas have declined instead of risen, that trend also may not last beyond the pandemic. The truth of the matter is that wholesale distribution will always be in demand, and as more households discover and transition to online ordering, demand will likely increase.
Whether you plan to be in business for a long time or plan to sell your business at some point in the near future this is good news. Now may be the best time to have your business valued so you know what it is worth. If you do plan to sell soon, now is a great time to prepare your business for sale.
Even if you plan to keep your business long term, a business valuation can help you obtain short- and long-term funding and increase your awareness of what assets you have and what they are worth.
Either way, a certified business broker can help you with your business valuation and even with understanding the implications of the pandemic and its impact on your ability to sell your business for a reasonable profit.
Do you have questions during this troubling time? Do you need a business valuation, or are you considering selling your business? Feel free to contact us at Rogerson Business Services. We’re here for you and would love to be your business broker through every step of the sales process.
Stay safe and take care.