Tipping point for self-distribution?

[Michael B]

Newbie question:

I'm curious- for those of you who self-distribute (and are running a very small operation- as in there are just a couple of you running things), about how many accounts seems too much to manage (considering the invoices, collections, deliveries, etc)? I'm sure there are many factors to this, but wondering if there's some quick and dirty advice on this.

Second newbie question: on average, about how many cases/bottles do you typically deliver at one time to each mom & pop store, and also to each bar/restaurant?

Thank you!

[Sonja]

I don't think there's a specific number to answer your question - for us, it got the point where the distances we were driving, and the amount of followup we were doing, etc., meant we could not take on any new customers and still maintain things as they were. So, we were either building a more robust distribution engine, or we were partnering with one. Since we didn't set out to be a distributor and we found an adequate partner, we went with the latter route. We were covering a geographic span that was up to 75 miles from our location in any direction, with concentrations of customers in certain areas, as you might expect. Pulling a number out of my you-know-what, I think it was around 75-100 accounts for us, but it's been awhile.

There are geographic variances in what people order and what they expect - in northern California, for example, stores (even large ones) buy by the bottle, whereas in other states they buy by the case. Some of that depends on your pricing structure as well.

Bars will often start with just a bottle or two to try it out, especially when it is a new product and a new supplier, which means you'll go there to sell it, to deliver the 1-2 bottles, and then to pick up the check 30 days later (often that is the expectation). You will want to consider having a minimum purchase requirement, but will want to be lenient with that at first because you are unknown to the customer and they won't want to take a huge risk on something unknown.

Good luck!