Are you thinking about starting a distribution business but still don’t have a business idea? If that’s the case, we’ve put together some of the best distribution business ideas you can choose from.
This blog post reveals 10 profitable business ideas in the distribution industry to give you many options to pick from.
We’ve also examined the future relevance of the distribution business ideas, the types of the distribution business, and why you should consider the business ideas (benefits).
We urge you to read through the entire article to properly understand what you need to know about this business industry and its opportunities.
So, let’s get started.
Distribution Business Ideas; An Overview
Generally, a distribution business is one of the supply chain businesses in the goods and services industry.
It involves manufacturing and delivering goods (physical and digital) through wholesalers and/or retailers to consumers.
Simply put, it’s the process through which goods move from the producers to the final consumer.
In this business, the retailer serves as the middle man between the manufacturers and the customers.
Starting up a distribution company requires you to have a warehouse where you can store your goods.
You’ll also need a decent amount of capital to create or buy the products.
Other things required are adequate preparations and determination to succeed.
Speaking of success, one thing that brings success in the distribution industry is the ability to identify the potential products that could be in demand and invest in them.
The business is all about identifying customers’ needs and creating or selling products that meet those needs.
In a nutshell, you could manufacture the products and distribute them to wholesalers/retailers or become a distributor for other companies.
Furthermore, the distribution business is categorized into;
- Retail distribution
- Wholesales distribution
Retail distributors buy products from the manufacturers or producers and sell them directly to consumers.
On the other hand, a wholesale distributor gets products from the manufacturers in larger quantities and resells them to retailers and other commercial businesses for profits.
Either way, you can work as an independent distributor or partner with the manufacturing companies to distribute their products and earn a living.
That brings us to the different types (channels) of distribution.
With the advent of online shopping, consumers have the privilege to choose different channels through which they shop.
Among other channels, here are eight distribution channels you can choose to distribute your products to your various customers.
Types Of Distribution Business; Distribution Business Ideas
Direct Sales
This is the process by which companies or manufacturers sell their products and services directly to their customers from their stores.
In this kind of sale, there’s no middleman between the company and its customers.
As a business owner, you can produce or manufacture your own products (physical or digital) and distribute them directly to your customers.
For instance, an independent record producer may allow fans to buy and download music directly from his website.
The business can also work for bakery business owners who produce their products and distribute them directly to their customers within their locality.
The direct sales distribution channel is profitable as it offers lots of benefits, among which are;
- Firstly, it is cost-effective.
- Also, you’ll have greater control over customers’ experience.
- Finally, interacting directly with customers increases trust, among other things.
Independent Distributor Channel
Independent distributors are sales agents who sell a company’s product directly to customers and earn a percentage based on the number of goods sold.
They bridge the gap between the company and its customers.
Also, they are used as a link in the marketing distribution chain.
The only thing required for this business is a place to store the goods as you sell to your customers.
Also, you’ll need a decent amount of capital to buy the products.
The benefits you would derive using this distribution channel include;
- A strong network of customers
- Commission-based earning; you can earn as much as you like depending on your marketing efforts, etc.
Retailer
This is the most widely used and effective distribution channel.
It is also one of the means through which products and services are distributed to customers in the distribution chain.
Some of the places you can find retailers include; department stores, specialty stores, and supermarkets.
This distribution channel allows consumers to interact with the product before buying them.
Also, the channel allows the retailers to introduce new products to customers before buying them.
As a retailer, you can sell your products in physical stores, online stores, or both depending on how you want to run the business.
Resellers
Resellers buy products directly from different manufacturers and sell them to their customers.
They may be required to have a physical or online store to promote the products to their customers and make profits.
Simply put, a reseller identifies and buys different products from different manufacturers and then resells them to his/her customer base for profits.
Some of the benefits of reselling business;
- To start with, you will enjoy the freedom to sell at your price and make as much profit as you want
- Also, there’s flexibility; you can sell a wide range of products, depending on customer demands, etc.
Wholesaler
Wholesalers are also one of the links in the distribution chain.
Their services involve buying and selling goods in bulk.
However, some wholesalers sell their products directly to the public via online stores and warehouses.
They sell their products at a lower price for people buying in bulk.
Just like every other distribution channel, the wholesaling business offers some benefits, which include;
- Firstly, the low costs of goods will entice buyers.
- Also, you can get the products at a cheaper rate from manufacturers, among others.
Intensive Distribution
The intensive distribution involves using a large number of channels to sell products.
It is not limited to just one channel.
This type of distribution common amongst general products or inexpensive items such as soft drinks.
This kind of product is found in almost all supermarkets, eateries, vending machines, and convenience stores.
Overall, this distribution method helps a business make massive sales of its products.
This could also be beneficial for you as an intensive distributor because the more of the products you sell, the more profits you make.
Exclusive Distribution
Exclusive distribution is also another distribution channel you can adopt to sell your products.
In this regard, products and services can only be found in a single-third-party distribution channel.
Also, the distribution allows one or a few distributors to become the sole authorized seller of the manufacturer’s products.
It is common with luxury goods such as wine, haute couture clothing, accessories, etc.
So, you could become the sole distributor of a brand and enjoy benefits such as;
- There’s fewer market competition
- Also, you can enjoy upport from the manufacturing brand
- Finally, there’s a steady supply of goods from the manufacturer, etc.
Selective Distribution
This is a distribution channel where the manufacturing companies sell their products through a selected network of retailers, resellers, or wholesalers.
This selective distribution is in-between intensive and exclusive distribution channels.
Here, the manufacturers make their products available in one or two selected outlets, often referred to as dealers.
This type of distribution method works best with products like electronics and home appliances.
Away from that, now let’s see some of the reasons why you should start up a distribution service.
Reasons To Become A Distributor; Benefits Of Distribution Business Ideas
Low Startup Costs
The distribution business is one of the businesses with low startup capital.
If you are an independent distributor or wholesaler, all you will need is just a warehouse to store your product.
Also, you’ll need a vehicle with which you can convey the products to your customers.
An average cost of over $100 can be enough to start your distribution business on a small scale if you already have a vehicle for transporting the goods.
Overall, starting up a distribution business isn’t capital-intensive.
It Offers Unlimited Income Potential
As a distributor, there’s no limit to how much you can make.
It all depends on the amount of time and effort you put into the business.
Furthermore, your business skills and how you are able to use them will determine how much the business can yield.
All you need is to put in the best effort and be consistent in your business.
Overall, your paycheck in the distribution industry is dependent on your ability to deliver.
Ability To Choose Your Clients Or Customers
This is one of the advantages of starting up a distribution business.
Being a distributor, you are at liberty to choose who to work with.
You can decide to work with hundreds of clients/customers or just a few depending on how you want to run your business.
That concludes this section, now, let’s see the various business ideas within the distribution industry.
9 Distribution Business Ideas
1. Greetings Card Distribution
Greeting cards are one of the most effective business ideas in the distribution industry.
A report states that Americans purchase approximately 6.5 billion greeting cards each year.
Hence, there’s a huge demand in this market, as people need greeting cards for different occasions.
It can be for birthdays, death, anniversaries, graduations, or to cheer loved ones.
You can go into the distribution of digitally printed cards, handcrafted cards, or hand-printed cards as they all have good demand.
Starting this distribution service, you can own a physical store, an online store, or both depending on your capacity.
The business doesn’t require high startup costs.
Above all, you can start with any amount and expand your business with time.
2. School Stationery Distribution; Distribution Business Ideas
This is also another way you can make money if you are looking for good distribution business ideas to start.
Stationery items are something that will never run out of demand so long as there are schools, colleges, and offices.
Presently, due to the rapid growth in the educational industry, there is a high demand for different school items.
There are segments of products for both school students and students who are in higher studies.
These items include; notepads, eraser, pencil, whitener, stapler, highlighter pen, pencil sharpener, etc.
Retailers are the rightful promoters for this kind of business.
One benefit of starting a stationary distribution business is that it has a low startup investment.
Overall, you can start the business from your home, open a physical store, or an online store.
Remember, your target customers are those in the educational line.
3. Herbal Products Distribution
The herbal product is another distribution business idea that pays well.
Due to the constant awareness of harmful chemical products, the demand for herbal medicines is growing.
Nowadays, people prefer taking herbal products due to their health benefits.
Some of the major areas you can start your distribution career include; personal care products, herbal cosmetics, home care products, etc
Finally, you can be an independent herbal product distributor, wholesaler, retailer, or reseller, depending on your financial capability.
4. Bakery Products Distribution
Bakery and confectionary services can never go extinct.
There is always a demand for different confectionary products and services, ranging from bread, rolls, cookies, pies, pastries, cakes, donuts, and muffins.
Research shows that the global bakery product market attained a value of USD 331.37 billion in 2020, driven by the rise in new product launches.
Also, the bakery industry is expected to grow further at a CAGR of 4.6% between 2021-2026.
Going by this, the bakery industry will keep growing and remain relevant.
So, as a distributor, one of the most effective channels to distribute your bakery products is through direct sales.
You can start this business from your home or by opening a physical store where you sell directly to your customers.
Alternatively, you can open an online store.
Going online will require you to own a website where you advertise your product and services to the public.
Furthermore, online store will allow you to meet the needs of a wider target market.
On the other hand, if you don’t have the capital to start a bakery company, you can choose to be an independent distributor.
In this regard, you sign up with any of the bakery industries to distribute their product and make your money.
For a start, you can make do with $700 if you are starting from your home.
Otherwise, you’ll need up to $12,000 and above to run a standard bakery distribution service.
5. Building Material; Distribution Business Ideas
The rate of profit in the real estate business and industry makes it one of the reasons why you should consider a building material distribution business.
In addition, this business has the potential of fetching you good revenues if you decide to start today.
One beautiful thing about the business is that you can use different distribution channels to promote goods and services.
For instance, you can adopt a direct sales distribution technique where the products move from you directly to your customer without any intermediaries.
This distribution channel allows you to take full control of the business from the production to the distribution stage.
Furthermore, you can as well start as an independent distributor, reseller, retailer, or wholesaler.
Some potential items of building materials you can start your distribution services include; cement, Nails, stone chips floor, tiles, TMT rods, etc.
Above all, start up this business can be capital-intensive, but you can start small with the amount you have and watch the business grow.
6. Car Accessories Distribution
This is another paying distribution business you can invest in.
Presently car accessories are in high demand, and the business is highly lucrative and profitable.
Some of the car accessory items you can start with include dent remover, seat covers, air freshener, car lighting, mobile accessories, etc.
You can start distributing any of these accessories as an independent distributor, wholesaler, retailer, or reseller.
Alternatively, you could create your own car accessories and use any of the distribution channels mentioned above to distribute your products.
However, this will be capital intensive.
Either way, you can go for the option that suits you best, depending on your finances.
7. Textile Distribution; Distribution Business Ideas
There are different types of raw materials in the garment industry, and textile is one of them.
The garment industry is growing and profitable due to the high demand for different textiles on daily basis.
Based on a report, the global apparel market is expected to grow to $ 2.1 trillion by 2025.
So, there is a huge market for anyone searching for a distribution opportunity in the textile industry.
You can start now and join the successful distributors at the top.
Meanwhile, you can use different distribution channels to promote this business.
It could either be direct sales, resellers, wholesalers, exclusive distribution, or selective distribution channels.
8. Electrical Item Distribution; Distribution Business Ideas
As an intending distributor, the electronic industry is a lucrative place to start a distribution business.
The demand for electrical items by both domestic and industrial users has hugely grown.
You can partner with any of the electronic companies to distribute their product if you don’t have the capital to start up your own.
Furthermore,some of the items you can distribute include electronic wires, fans, lights, switches, or home appliances.
The startup cost depends on how big or small you want to start.
An average capital of between $800-$1000 is required to run an electronic distribution business.
9. Cutlery Distribution
Cutley distribution is also one of the most lucrative business ideas you can profit from.This is because there is always a huge market for it.
Additionally, every family desires to have one or two crockeries in their kitchen.
There are different segments of crockeries items which you can start your distribution business with.
They include jugs, dinner sets, trays, bowls, cup sets, coffee mugs, etc.
In all, you can start a retailer, independent distributor, reseller, or wholesaler, depending on your financial strength.
10. Auto Spare Parts Distribution; Distribution Business Ideas
The auto spare part is one of the best businesses you can start your distribution business with.
Also, the automobile industry is rapidly growing, and many business opportunities exist to explore.
There are different products you can sell, such as;
- Automobiles
- Oil and lubricants.
- Chain and sprockets.
- Pison and piston rings.
- Automobile filter.
- Shock absorber.
- Used auto parts, among others.
You can do this business by being an independent distributor, retailer, wholesaler, or produce and sell directly to your customers.
Distribution Business Ideas; Conclusion
There you go!
We have offered you ten options of distribution business ideas to choose from.
One important thing you should know is no business achieves success overnight.
Building a successful business takes time, consistency, effort, and hard work.
We suggest you pick any business ideas that interest you and get started.
Remember, you own the key to your success.
Best wishes!
