Distribution Company Business Plan
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Executive Summary
Business Overview
KitchenWare Distributors is a startup distribution company located in Long Beach, California. The company was founded by Nelson Fuller, a former senior executive in a kitchenware company based in Chicago, Illinois. Nelson made over ten million dollars in kitchenware sales during the past two years for his former company, and felt the time was now right to start his own company in California. Because Long Beach is a leading port for ships bringing goods into the U.S. from China and other Asian countries, Nelson believes the greatest kitchen product range and highest dollar value can be amassed via the Long Beach import area.
KitchenWare Distributors specializes in selling kitchen products, including tabletop, tableware, cookware, and cutlery, to independent retailers, retail chains, and e-commerce platforms. Nelson recruited his wife, Jamie Fuller, to join him in the new startup, as her former position was a marketing manager for a small kitchen appliance company. Her new role will be as the Executive Manager of tabletop and cookware products.
Product Offering
The following are the services that KitchenWare Distributors will provide:
- Large-volume sales to kitchen product companies, including brick-and-mortar and ecommerce
- 24/7 customer service representative support
- Competitive pricing
- Diverse product selection
- Free transport from Long Beach to customer location
- Package pricing based on company loyalty programs
- Tiered products based on customer’s target audience
Customer Focus
KitchenWare Distributors will target retail companies, retail chains, and kitchenware stores. KitchenWare Distributors will also target e-commerce platform companies that specialize in kitchen product sales. KitchenWare Distributors will target industrial restaurant and kitchen supply companies. KitchenWare Distributors will target state and federal government cooking and kitchen supply sites.
Success Factors
KitchenWare Distributors will be able to achieve success by offering the following competitive advantages:
- Friendly, knowledgeable, and highly-qualified team at KitchenWare Distributors.
- Customer service representatives with 24/7 service for clients.
- Free transport from Long Beach to customer distribution centers or retail stores.
- Unique logistical software program designed for kitchen product retailers.
- KitchenWare Distributors offers reasonable pricing with free transportation included; both excellent savings.
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Financial Highlights
KitchenWare Distributors is seeking $200,000 in debt financing to launch its kitchen product line of goods. The funding will be dedicated toward securing the office space and purchasing office equipment and supplies. Funding will also be dedicated toward three months of overhead costs to include payroll of the staff, rent, and marketing costs for the marketing costs. The breakout of the funding is below:
- Office space build-out: $20,000
- Office equipment, supplies, and materials: $10,000
- Three months of overhead expenses (payroll, rent, utilities): $150,000
- Marketing costs: $10,000
- Working capital: $10,000
The following graph outlines the financial projections for KitchenWare Distributors.
Company Overview
Who is KitchenWare Distributors?
KitchenWare Distributors is a newly established full-service distribution company based in Long Beach, California. KitchenWare Distributors is committed to becoming the most reliable, cost-effective, and efficient choice for retail chains, retailers and kitchenware supply stores in the U.S. KitchenWare Distributors will provide a comprehensive menu of customer support services for any client to utilize. Their full-service approach includes free transportation from the dock at Long Beach to the city of the client distribution center or retail store.
KitchenWare Distributors will present and sell through a vast array of kitchen products, including tabletop, kitchenware, cookware, serveware, and cutlery. The team of professionals are highly qualified and experienced in distribution and negotiations. KitchenWare Distributors removes all headaches and issues of the process of buying and transporting inventory for retail stores by taking excellent care of the inventory items and stock and ensuring that all issues are taken care of expeditiously while delivering the best customer service.
KitchenWare Distributors History
KitchenWare Distributors is owned and operated by Nelson and Jamie Fuller, both former executives working within the kitchen products industry in a kitchenware company based in Chicago, Illinois. Nelson made over ten million dollars in kitchenware sales during the past two years for his former company, and felt the time was now right to start his own company in California. Because Long Beach is a leading port for ships bringing goods into the U.S. from China and other Asian countries, Nelson believes the greatest kitchen product range and highest dollar value can be amassed via the Long Beach import area.
KitchenWare Distributors specializes in selling kitchen products, including tabletop, tableware, cookware, and cutlery, to independent retailers, retail chains, and e-commerce platforms. Nelson recruited his wife, Jamie Fuller, to join him in the new startup, as her former position was a marketing manager for a small kitchen appliance company. Her new role will be as the Executive Manager of tabletop and cookware products.
Since incorporation, KitchenWare Distributors has achieved the following milestones:
- Registered KitchenWare Distributors, LLC to transact business in the state of California.
- Has a contract in place at one of the office buildings, where the marketing department and administrative group will set up their 10,000 square foot office space.
- Reached out to numerous former clients and contacts to include KitchenWare Distributors as a distribution vendor.
- Began recruiting a staff of fifteen customer service representatives and five office personnel to work at KitchenWare Distributors.
KitchenWare Distributors Services
The following will be the services KitchenWare Distributors will provide:
- Large-volume sales to kitchen product companies, including brick-and-mortar and ecommerce
- 24/7 customer service representative support
- Competitive pricing
- Diverse product selection
- Free transport from Long Beach to customer location
- Package pricing based on company loyalty programs
- Tiered products based on customer’s target audience
Industry Analysis
The kitchen products industry is expected to grow during the next five years to over $44 billion.
The growth will be driven by the consumer interest in premium kitchen countertop appliances that perform with precision.
The growth will also be driven by smart kitchen appliances (remote turn on/turn off capabilities).
The growth will be driven by color palette changes in 2027-28.
Technological advances will drive the U.S. market growth.
The growth will also be driven by eco-friendly, and sustainable tableware products.
Costs will likely be reduced as kitchenware categories within lifestyle choices are discounted.
Costs will likely be reduced as consumers turn to e-commerce for tableware and cookware choices, which reduces shipping costs overall.
Download the Distribution Company business plan template (including a customizable financial model) to your computer here <–
Customer Analysis
Demographic Profile of Target Market
KitchenWare Distributors will target retail chains, retail stores, kitchenware stores, and government contract customers within California and the U.S. population. .
The precise demographics for KitchenWare Distributors are:
| Total | Percent | |
|---|---|---|
| Total population | 1,680,988 | 100% |
| Male | 838,675 | 49.9% |
| Female | 842,313 | 50.1% |
| 20 to 24 years | 114,872 | 6.8% |
| 25 to 34 years | 273,588 | 16.3% |
| 35 to 44 years | 235,946 | 14.0% |
| 45 to 54 years | 210,256 | 12.5% |
| 55 to 59 years | 105,057 | 6.2% |
| 60 to 64 years | 87,484 | 5.2% |
| 65 to 74 years | 116,878 | 7.0% |
| 75 to 84 years | 52,524 | 3.1% |
Customer Segmentation
KitchenWare Distributors will primarily target the following customer profiles:
- Retail chains
- Retail stores, specifically kitchen product stores
- Ecommerce kitchen product companies
- State and government contractors for kitchen products
Competitive Analysis
Direct and Indirect Competitors
KitchenWare Distributors will face competition from other companies with similar business profiles. A description of each competitor company is below.
Strategic Distribution Group
The Strategic Distribution Group is located in New Jersey, near Ports America, Inc. The company receives goods via ship transport initiated in Shenzhen, China and directed to retail chains and kitchen stores throughout the U.S. The company was started by a partnership between Hershel Barts and Mark Tokien, formerly kitchen product managers for a major kitchen appliance manufacturer.
The Strategic Distribution Group offers limited discounts on product assortment groups or packages; however, shipping from the port to the retail chain market is provided at no cost. The strength of the company lies in the experience of the partners and the sales history in this industry sector they represent.
Cooking & Eating, Inc.
Cooking & Eating, Inc., headquartered in Scottsdale, Arizona, is a large retail chain that offers a distribution service to clients and guests who want shipment and associated logistics packaged together by Cooking & Eating, Inc. The company was founded in 2014 by Eddy Walker, who found the distribution ties were weak in the Southwest portion of the U.S. and wanted to improve the strength of the industry while also owning a cooking video company that could capitalize on the location and new product introduction.
Currently, Cooking & Eating, Inc. is focused on cooking videos for a YouTube audience of 1.5 million viewers and video reels for TikTok which demonstrate cooking and eating in comedic fashion. The owner of the company, Eddy, enjoys appearing and leading the conversational topics on the show, as well as introducing his company once again to the final outcomes of this year.
Retread Distributors & More
Retread Distributors & More specializes in closeout lots, damaged inventory, returned products and “scratch & dent” appliance units. Their clients include major resellers, such as Overstock.com, and other secondary markets who purchase lots at greatly discounted prices and then hope to sell those lots at a miniscule profit.
Retread Distributors & More is owned by Dottie Masters, a woman who has been a leader in the reselling industry for over forty years. The company is one of several owned by Dottie, and as such, it presents a “bargain basement” type of atmosphere, albeit one with excellent pricing and values that can be very profitable for retailers should they choose to sell such inventory items.
Download the Distribution Company business plan template (including a customizable financial model) to your computer here <–
Competitive Advantage
KitchenWare Distributors will be able to offer the following advantages over their competition:
- Friendly, knowledgeable, and highly-qualified team at KitchenWare Distributors.
- Customer service representatives with 24/7 service for clients.
- Free transport from Long Beach to customer distribution centers or retail stores.
- Unique logistical software program designed for kitchen product retailers.
- KitchenWare Distributors offers reasonable pricing with free transportation included; both advantageous savings.
Marketing Plan
Brand & Value Proposition
KitchenWare Distributors will offer the unique value proposition to its clientele:
- Highly-qualified team of skilled employees who are able to provide comprehensive customer service support.
- Free shipping from Long Beach port to client retail location.
- Unbeatable 24/7 customer service for clients.
- Tiered discounts geared to assist all clients in savings
- Pricing packages that are advantageous for clients
Promotions Strategy
The promotions strategy for KitchenWare Distributors is as follows:
Word of Mouth/Referrals
KitchenWare Distributors has built up an extensive list of contacts over the years by providing exceptional service and expertise to the former clients of Jamie Miller. Former clients have already committed to follow both new co-owners to the KitchenWare Distributors company and refer the new company to their associates.
Professional Associations and Networking
Both Nelson and Jamie Miller are members of national trade associations and both will continue to network and offer services to other members. The company may also choose to sponsor activities during trade shows that will highlight the new company.
Website/SEO Marketing
KitchenWare Distributors will extensively utilize their website. The website will be well organized, informative, and list all the services that KitchenWare Distributors provides. The website will also direct interested buyers to several pages of product inventory, including pricing and available quantities of each. Customers can buy online using the “Buy” page on the website. The website will list the contact number of their customer service representative and introduce them both via the Chat Box on the website. KitchenWare Distributors’s website presence will focus on SEO marketing tactics so that anytime someone types in the Google or Bing search engine “kitchen products company” or “kitchen supplies near me”, KitchenWare Distributors will be listed at the top of the search results.
Pricing
The pricing of KitchenWare Distributors will be moderate and on par with competitors so customers feel they receive excellent value when purchasing their services.
Operations Plan
The following will be the operations plan for KitchenWare Distributors.
Operation Functions:
- Nelson Miller will be the co-owner and president of the company. He will oversee all staff and manage client relations.
- Jamie Miller will be the Executive Manager of the tabletop and cookware divisions.
- Ken Stevens will be the Marketing Manager who will provide all marketing for KitchenWare Distributors.
Download the Distribution Company business plan template (including a customizable financial model) to your computer here <–
Milestones:
KitchenWare Distributors will have the following milestones completed in the next six months.
- 5/1/202X – Finalize contract to lease office space
- 5/15/202X – Finalize personnel and staff employment contracts for the KitchenWare Distributors
- 6/1/202X – Finalize contracts for KitchenWare Distributors clients
- 6/15/202X – Begin networking at industry events
- 6/22/202X – Begin moving into KitchenWare Distributors office
- 7/1/202X – KitchenWare Distributors opens its office for business
Management Team
KitchenWare Distributors is owned and operated by Nelson and Jamie Fuller, both former executives working within the kitchen products industry in a kitchenware company based in Chicago, Illinois. Nelson made over ten million dollars in kitchenware sales during the past two years for his former company, and felt the time was now right to start his own company in California. Because Long Beach is a leading port for ships bringing goods into the U.S. from China and other Asian countries, Nelson believes the greatest kitchen product range and highest dollar value can be amassed via the Long Beach import area.
KitchenWare Distributors specializes in selling kitchen products, including tabletop, tableware, cookware, and cutlery, to independent retailers, retail chains, and e-commerce platforms. Nelson recruited his wife, Jamie Fuller, to join him in the new startup, as her former position was a marketing manager for a small kitchen appliance company. Her new role will be as the Executive Manager of tabletop and cookware products.
Financial Plan
Key Revenue & Costs
The revenue drivers for KitchenWare Distributors are the fees they will charge to the clients for their products and services.
The cost drivers will be the overhead costs required in order to staff KitchenWare Distributors. The expenses will be the payroll cost, rent, utilities, office supplies, and marketing materials.
Funding Requirements and Use of Funds
KitchenWare Distributors is seeking $200,000 in debt financing to launch its distribution company. The funding will be dedicated toward securing the office space and purchasing office equipment and supplies. Funding will also be dedicated toward three months of overhead costs to include payroll of the staff, rent, and marketing costs for the print ads and association memberships. The breakout of the funding is below:
- Office space build-out: $20,000
- Office equipment, supplies, and materials: $10,000
- Three months of overhead expenses (payroll, rent, utilities): $150,000
- Marketing costs: $10,000
- Working capital: $10,000
Download the Distribution Company business plan template (including a customizable financial model) to your computer here <–
Key Assumptions
The following outlines the key assumptions required in order to achieve the revenue and cost numbers in the financials and in order to pay off the startup business loan.
- Number of Client Purchases Per Month: 63
- Average Revenue per Month: $616,000
- Office Lease per Year: $100,000
Financial Projections
Income Statement
| FY 1 | FY 2 | FY 3 | FY 4 | FY 5 | ||
|---|---|---|---|---|---|---|
| Revenues | ||||||
| Total Revenues | $360,000 | $793,728 | $875,006 | $964,606 | $1,063,382 | |
| Expenses & Costs | ||||||
| Cost of goods sold | $64,800 | $142,871 | $157,501 | $173,629 | $191,409 | |
| Lease | $50,000 | $51,250 | $52,531 | $53,845 | $55,191 | |
| Marketing | $10,000 | $8,000 | $8,000 | $8,000 | $8,000 | |
| Salaries | $157,015 | $214,030 | $235,968 | $247,766 | $260,155 | |
| Initial expenditure | $10,000 | $0 | $0 | $0 | $0 | |
| Total Expenses & Costs | $291,815 | $416,151 | $454,000 | $483,240 | $514,754 | |
| EBITDA | $68,185 | $377,577 | $421,005 | $481,366 | $548,628 | |
| Depreciation | $27,160 | $27,160 | $27,160 | $27,160 | $27,160 | |
| EBIT | $41,025 | $350,417 | $393,845 | $454,206 | $521,468 | |
| Interest | $23,462 | $20,529 | $17,596 | $14,664 | $11,731 | |
| PRETAX INCOME | $17,563 | $329,888 | $376,249 | $439,543 | $509,737 | |
| Net Operating Loss | $0 | $0 | $0 | $0 | $0 | |
| Use of Net Operating Loss | $0 | $0 | $0 | $0 | $0 | |
| Taxable Income | $17,563 | $329,888 | $376,249 | $439,543 | $509,737 | |
| Income Tax Expense | $6,147 | $115,461 | $131,687 | $153,840 | $178,408 | |
| NET INCOME | $11,416 | $214,427 | $244,562 | $285,703 | $331,329 |
Balance Sheet
| FY 1 | FY 2 | FY 3 | FY 4 | FY 5 | ||
|---|---|---|---|---|---|---|
| ASSETS | ||||||
| Cash | $154,257 | $348,760 | $573,195 | $838,550 | $1,149,286 | |
| Accounts receivable | $0 | $0 | $0 | $0 | $0 | |
| Inventory | $30,000 | $33,072 | $36,459 | $40,192 | $44,308 | |
| Total Current Assets | $184,257 | $381,832 | $609,654 | $878,742 | $1,193,594 | |
| Fixed assets | $180,950 | $180,950 | $180,950 | $180,950 | $180,950 | |
| Depreciation | $27,160 | $54,320 | $81,480 | $108,640 | $135,800 | |
| Net fixed assets | $153,790 | $126,630 | $99,470 | $72,310 | $45,150 | |
| TOTAL ASSETS | $338,047 | $508,462 | $709,124 | $951,052 | $1,238,744 | |
| LIABILITIES & EQUITY | ||||||
| Debt | $315,831 | $270,713 | $225,594 | $180,475 | $135,356 | |
| Accounts payable | $10,800 | $11,906 | $13,125 | $14,469 | $15,951 | |
| Total Liability | $326,631 | $282,618 | $238,719 | $194,944 | $151,307 | |
| Share Capital | $0 | $0 | $0 | $0 | $0 | |
| Retained earnings | $11,416 | $225,843 | $470,405 | $756,108 | $1,087,437 | |
| Total Equity | $11,416 | $225,843 | $470,405 | $756,108 | $1,087,437 | |
| TOTAL LIABILITIES & EQUITY | $338,047 | $508,462 | $709,124 | $951,052 | $1,238,744 |
Cash Flow Statement
| FY 1 | FY 2 | FY 3 | FY 4 | FY 5 | ||
|---|---|---|---|---|---|---|
| CASH FLOW FROM OPERATIONS | ||||||
| Net Income (Loss) | $11,416 | $214,427 | $244,562 | $285,703 | $331,329 | |
| Change in working capital | ($19,200) | ($1,966) | ($2,167) | ($2,389) | ($2,634) | |
| Depreciation | $27,160 | $27,160 | $27,160 | $27,160 | $27,160 | |
| Net Cash Flow from Operations | $19,376 | $239,621 | $269,554 | $310,473 | $355,855 | |
| CASH FLOW FROM INVESTMENTS | ||||||
| Investment | ($180,950) | $0 | $0 | $0 | $0 | |
| Net Cash Flow from Investments | ($180,950) | $0 | $0 | $0 | $0 | |
| CASH FLOW FROM FINANCING | ||||||
| Cash from equity | $0 | $0 | $0 | $0 | $0 | |
| Cash from debt | $315,831 | ($45,119) | ($45,119) | ($45,119) | ($45,119) | |
| Net Cash Flow from Financing | $315,831 | ($45,119) | ($45,119) | ($45,119) | ($45,119) | |
| Net Cash Flow | $154,257 | $194,502 | $224,436 | $265,355 | $310,736 | |
| Cash at Beginning of Period | $0 | $154,257 | $348,760 | $573,195 | $838,550 | |
| Cash at End of Period | $154,257 | $348,760 | $573,195 | $838,550 | $1,149,286 |
Distribution Company Business Plan FAQs
What Is a Distribution Company Business Plan?
A distribution company business plan is a plan to start and/or grow your distribution company business. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections.
What are the Main Types of Distribution Company Businesses?
There are a number of different kinds of distribution company businesses, some examples include: Exclusive Distribution Business, Direct Distribution Business, Selective Distribution Business, and Intensive Distribution Business.
How Do You Get Funding for Your Distribution Company Business Plan?
Distribution Company businesses are often funded through small business loans. Personal savings, credit card financing and angel investors are also popular forms of funding.
What are the Steps To Start a Distribution Company Business?
Starting a distribution company business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.
1. Develop A Distribution Company Business Plan - The first step in starting a business is to create a detailed distribution company business plan that outlines all aspects of the venture. This should include potential market size and target customers, the services or products you will offer, pricing strategies and a detailed financial forecast.
2. Choose Your Legal Structure - It's important to select an appropriate legal entity for your distribution company business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your distribution company business is in compliance with local laws.
3. Register Your Distribution Company Business - Once you have chosen a legal structure, the next step is to register your distribution company business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws.
4. Identify Financing Options - It’s likely that you’ll need some capital to start your distribution company business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms.
5. Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations.
6. Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events.
7. Acquire Necessary Distribution Company Equipment & Supplies - In order to start your distribution company business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation.
8. Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your distribution company business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising.