How to Start a Wine Distribution Company

For a new entrepreneur starting a wine distribution company is moderately challenging. Wine distributors stock different brands of wine and spirits.
The quality and brand name determines the price differentiation between brands. The brew attracts a huge market and is in high demand.
The entrepreneur needs adequate funding, marketing strategy and a good location. They also need a steady source of wine and dependable sales staff.
The enterprise is best run as a one man venture. To establish you company write a business plan and carry out feasibility study to determine your best location.
The major challenge is building a good distribution channel. Major wine manufacturers have built their brand names through aggressive marketing and promotions. This enables the wine distributor focus on selling the product.
Funding the Wine Distribution Company
Financial considerations include lease arrangement, permits and stock. Purchasing stock takes up 40% of your funding.
Other major investment is buying a bus or truck to convey your goods. Although you can always use a haulage company this is not cost effective in the long run.
Approach any good commercial bank in your area for loans. You need a fixed asset as collateral and a guarantor. Ask for long term loans of about 2-3 years with fix interest rate.
To secure the loan present your business plan and feasibility study including experience management team. Some banks make it mandatory that you open an account with them to facilitate the loan and repayment.
Permit and Licenses.
The business of wine distribution is highly regulated. You need permits and licenses to sell alcoholic drinks. Apply for a wholesale trade license including an alcohol and tobacco trade license.
Register your business as a sole proprietorship and get insurance. If you want to add beer to your inventory you need other permits.
Secure distributor agreement with major brands in your community. Find out any additional local or state licensing to launch your enterprise.
Carry out a Feasibility Study
The feasibility study addresses ideal location, competitors and labor requirements. The study focuses on financial institutions in your locality and road network.
Include a survey of customer’s interests and preferences. How many hotels, restaurants, event centers and recreational facilities do they have in your community?
Discover the trending brand and level of penetration. Possible customers should be factored such as grocery store owners, supermarkets, small retail stores.
Others are club houses, nightclubs, bars and private individuals. The feasibility study identifies distribution channels and financial strength of host community.
The location should be in a middle or upper class neighborhood.
Sourcing the Wine Products
There are various ways to source your wines such as importers and manufacturers. Purchase your stock from both big manufacturers and small wine producers.
 Wine distributors should stock a variety of wines for greater gain and better profit taking. You can approach wine companies to secure distribution deals and steady supply.
Build a Website
There is nothing wrong in building a website to reach customers. Choose a good domain name and develop a SEO website.
On your website include images of the wines you stock, minimum purchase, description, price and a shopping cart. Leave provisions for card or PayPal payments and shipping arrangement.
A major aspect of wine delivery is transportation. You need to transport the wine to your warehouse and also make deliveries.
You need a dedicated van, bus or small truck to convey the goods. Hire a trust worthy driver to handle deliveries or do it yourself.
Other staff you might need is an accountant to balance the book. You can learn accounting procedures and good book keeping through diploma programs or tutorials.
Proper record keeping is mandatory for effective financial management. The records should include purchase orders, inventory, sales and debtors.
Others are utility charges, tax, salaries, and lease payment. You can use an external auditor or accountant to do your books.
 How to Start A Distribution Business
Marketing Strategy for Wine Distribution Business
To reach your customers prepare a beautiful catalogue of your wines. Approach stores, supermarkets, event planners, restaurants and hotel in your area.
Print flyers, poster and signboards so your community is well informed of your core business. Your marketing strategy is to each retailer, individuals and businesses for patronage.


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