So, you have a successful wholesale operation…at least by the looks of it.
You’ve got high sales volumes and revenue. Your customers and employees are satisfied. You serve a large territory. You’ve got it all figured out…
You aren’t profitable – in fact, you are barely scraping by as a wholesale parts business.
Sounds familiar, doesn’t it?
Just like you, countless other wholesale parts businesses face this specific challenge.
However, only a few manage to tackle it successfully and come out the other side as a profitable business on a sustainable growth path. The rest are forced out of business.
Wondering how you can run a successful and profitable wholesale parts business?
Here are the five secret, proven, and tried-and-tested tips to running a successful wholesale parts business…
1. Harness The Power Of Marketing & Advertising
Contrary to popular belief and conventional wholesale parts business models, effective marketing and advertising are the single most important aspect you absolutely need to focus on.
You can’t just sit around hoping for potential customers to come in and buy what you are offering – that’s just now how it works anymore.
You’ve got to reach out, establish trust as well as credibility, portray yourself as a market leader, and develop personal, meaningful relationships with prospects. Plus, you need to prove to them that you can cater to all their needs and solve their problems quickly and efficiently. This way, they’ll know that they can count on you to help keep their production schedules rolling through thick and thin.
P.S. Begin by building your team first and embrace grassroots marketing i.e., heading out into the field and having regular face-time with your prospects. Understand their problems and answer their queries and concerns. It will be a game-changer for your business.
2. Embrace Strategic Inventory Management
No, inventory management is not just about knowing what your current inventory level is.
It’s the art of managing, documenting, anticipating, and stocking the parts you’ll need in the future – long before they are requested – keeping in mind the demand, changing trends, seasonality, purchase history, sales activity, existing stock, and supply.
What’s more is that you can also manage your inventory by keeping track of lost sales data.
Ask yourself: What exactly didn’t you have at hand at a specific time? This will help you figure out what you should stock up on.
Moreover, remember that there’s no substitute for having a strong, capable parts manager who has the pulse of the market and can proactively as well as strategically manage the inventory. If you don’t have one, train or hire one as soon as possible.
3. Build Your Brand To Be Profitable, Independent Of Any Manufacturer
Don’t put all your eggs in one basket – you’ve heard that before haven’t you?
It means you shouldn’t focus on investing all your resources in any one particular thing. If you do, you risk losing it all. So, diversify!
Now how is this relevant to your wholesale parts department or business?
Well, you need to rethink the way you do business. You need to partner up with multiple manufacturers so your business can survive as well as thrive even if working with one or two of the manufacturers doesn’t remain profitable anymore for whatever reason. Maybe they will stop offering you any rebates, or they’ll simply cut ties with you. After all, who knows what card you are going to be dealt next?
So, make it a point to build multiple brand partnerships and a holistic network. It really is one foolproof way of scaling your business sustainably – that too, on your own feet.
4. Offer Quality Customer Service, Every Single Time!
Delight your customers at every single touch point with your company. Period.
Right from the first phone call comes to inquire about a specific part to delivering that very part to their front door, it should be a seamless experience. No errors and delays. None!
Be friendly, be courteous, and genuinely care about your customers as your family. It’s easier said than done, but it’s precisely what will turn them into a raving fan and make them keep coming back. Isn’t that just what you want?
So, build customer loyalty by prioritizing customer service and grow your brand on auto-pilot.
5. Remember, That’s Its NOT All About The Price
Sure, the competition is cut-throat, and your customers will more often than not opt to do business with the one offering higher discounts and lowest prices.
But wait a minute and think this through.
Is wholesale business merely a race to the bottom? Is price what’s it all about? Can you win someone’s loyalty just by offering the lowest price?
Make no mistake, price is indeed important, but it’s not the end all be all. In fact, it’s the experience you offer that matters most.
Remember that your wholesale parts business is what your customers are relying on to keep their business operations running smoothly. So, you are in a position to offer them so much more than just the lowest price.
You can stand out by being responsible and reliable, offering convenience, and delivering guaranteed quality of products and services. Little things such as calling back the customer and letting them know when their order will be ready and what you are doing to complete their order on time can make a lot of difference.
Running a successful and profitable wholesale parts business is not easy. Having said that, the above-mentioned five actionable tips can go a long way in empowering you to grow your business and become profitable.
So, what are you waiting for?
Implement them today and brace yourself for the results!
In case you have any questions or concerns, feel free to reach out to us, and don’t forget to follow our podcast – Parts Hold!