Selling to distributors
How distributors work, what they ask for and what to check in the contract. SellToStores finds distributors that already serve your category, pitches them and reviews terms before you sign.
What does a distributor do?
A distributor buys from you at a discount, stores the product and sells it to retailers. You give up margin and gain reach. The distributor handles the store relationships and often the delivery, so you ship larger orders to one customer instead of small orders to many.
When is a brand ready for a distributor?
A brand is ready when it can fill pallet-size orders on a regular schedule, its cost leaves room for both a distributor discount and a store discount, and it wants regional or national reach without hiring sales reps. If any of those fail, start with independent stores.
How does SellToStores find distributors for my brand?
SellToStores builds a target list of distributors that already carry brands like yours and serve the store types you want. It then sends a pitch and a price sheet that shows the distributor's buyer their margin at a glance, and follows up until you get a yes or a clear no.
What does a distributor pitch include?
A strong pitch includes a short brand summary, product list, wholesale price to the distributor with suggested retail, case and pallet details, your minimums and lead times, and the paperwork the distributor will ask for. The price sheet should show their margin at a glance.
What paperwork do distributors ask for?
Distributors commonly ask for UPC codes, product liability insurance, spec sheets and your terms. Regulated categories add more, such as ingredient lists and safety documentation. SellToStores gives you a checklist of what distributors ask for so you can prepare before the first call.
How much margin will a distributor take?
Distributor margin varies by distributor, category and volume, so there is no standard figure to quote. The audit works from your real quotes and shows what is left for you after the distributor and the store each take their share.
Do I need to give a distributor exclusivity?
Not usually at the start. Exclusivity makes sense only if the distributor commits to minimum purchases and you can exit if they miss them. Without a minimum purchase commitment, an exclusive territory can lock your product up while nothing sells.
What should I check in a distributor agreement?
Check payment terms, territory, exclusivity, minimum purchases, how long the agreement lasts and how you can exit. SellToStores marks up the agreement before you sign and lists what to negotiate, in plain English. Have an attorney review the final contract.
What payment terms do distributors ask for?
Many ask for net 30 to net 60 or longer. Long terms strain your cash flow, because you pay for production before you are paid. Compare the terms with your own production cycle, and ask for a credit check or partial prepayment on the first order if cash is tight.
Can I still sell on my own website if I sign with a distributor?
Yes, if the contract says so. SellToStores checks that the agreement does not block direct sales and that a minimum advertised price policy covers every channel, so the distributor and your own site do not undercut each other.
What are chargebacks and promotional allowances?
Distributors and their retail customers sometimes ask for promotional funds, markdown support or deductions for damaged goods. These reduce your margin. Ask what is expected before you sign, and build the likely cost into your distributor price.
What if a distributor resells to discount channels?
Distributors that resell to discount channels can undercut your price and hurt full-price stores. Put resale limits and a minimum advertised price policy in the agreement, and ask the distributor which accounts it serves. SellToStores lists this as a watch-out in its terms review.
Can SellToStores promise that a distributor will sign?
No. Distributors decide. SellToStores commits to the target list, the outreach and the reporting. If a distributor says no, you get a clear answer and the reason when one is given, so you can adjust price or materials for the next pitch.
How long does it take to sign a distributor?
No timeline can be promised. Distributors review many brands, and their decisions depend on their calendar and your response speed. Expect several rounds of follow-up, and prepare samples and price sheets in advance so you never hold up a buyer.
More SellToStores answers
Related: Distributor service, Free retail audit
Answers about SellToStores come from this site's pages and terms. Everything else is general wholesale guidance with illustrative numbers, and regulatory points are not legal advice, so confirm them with the regulator or counsel.
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