How to start a wholesale business in Uganda.
Wholesaling according to Investopedia is the act of buying goods in bulk from a manufacturer at a discounted price and selling to a retailer for a higher price, for them to repackage and in turn, resell in smaller quantities at an even higher price to consumers.
Wholesaling can be done in any sector and there are many wholesale shops specialising in different products here in Uganda.
Wholesale shops are so profitable no wonder all people want to start this business. Now let us look at the steps to follow when starting a wholesale business here in Uganda in 2021.
Step 1. Identify the market for your products
Many business owners have got it wrong when starting up a new business, they normally skip this step of market research.
But this step is so crucial because if skipped and you start up your wholesale business in an area where you have no customers willing to buy what you sell, it is your own money that you will lose.
So instead of trusting your instincts and your own understanding of the area where you want to start your wholesale business, it is advisable to go on the ground and carry out some research to truly confirm whether your business can thrive in the area you intend to put it.
You can do this by;
- Spend some time and visit the market where you want to set up your store and visually investigate to see if there is a market for your business.
- Hiring a research team to carry out research on the market for your products.
- Sampling your products in your market by coming up with sample products and getting people’s views on the sample products.
Market research helps you come up with which products move well in that specific area and which products have a low market.
And as a rule of thumb, you need to move where the money is. If you find out that beauty products do well in a given area, and hardware products don’t do well, why should you start up a hardware wholesale shop in that place?
So you need to be open-minded when carrying out market research.
Step2; Come up with a product you want to sell
As we have already said that there are so many wholesale shops in Uganda selling different commodities.
If you too are planning to start up a wholesale business here in Uganda, you need to specialise in a given “niche” or type of commodity or product.
After carrying out market research, you can come up with a specific product that you will sell in your wholesale business.
For example, a hardware wholesaler deals majorly in hardware products and nothing else, while a general merchandise shop deals in general merchandise, not other different products.
So if you are planning to start up a wholesale business, it is good to specialise in a given product type and make your wholesale business that will deal in that specific product.
Honestly speaking, there are millions of products from which you can choose to start selling in your own wholesale business, but I would not encourage you to sell many different types of products in one wholesale business because your business will lose its identity.
Step 3; Find a suitable location for your business
The location of the business among many other factors directly contributes to the success or failure of a business.
After carrying out market research and finding out that the place where you want to put your wholesale business has a market for the products you want to sell, then it is time to look at the place where you will locate your business.
An efficient wholesale business position should be a place that is near your suppliers, easily accessible by delivery tracks and not far away from your customers.
It should also be secure. So after carrying out market research, you need to spend some time too looking for a suitable place where your business will be.
A point to note, however; Places that are in busy areas are expensive to buy or lease as compared to those that are distanced from busy areas.
Positioning your wholesale business in a busy area is so good since you get a lot of exposure to customers which in turn results in high sales, however, it comes at a higher cost as compared to one who will start up his wholesale business in a non-busy place.
Step 3; Talk to your suppliers
As a wholesaler, you will have to deal with the manufacturers and suppliers of the products you sell.
These are the ones that will give you the products that you will put into your business.
Establishing a good relationship with your suppliers and manufacturers is good for you and your business because if the relationship between the two of you is good, you can easliy get products on credit and pay later.
This is the most ideal situation, sometimes, you may not be able to come in touch with the suppliers directly, so the real people you may meet will be distributors of the products that you want to sell.
A challenge with meeting distributors instead of suppliers is that distributors charge more than the suppliers would.
Unfortunately in Uganda here, most wholesale business owners deal with distributors instead of suppliers.
However, if you get a chance to deal directly with the suppliers, you will buy your products at a very good price.
Step 5; Prepare your workplace
Once striking a deal with the suppliers, you are soon or later going to receive products from the suppliers and distributors.
So before the products and commodities start coming in, you need to prepare the place where they will be stored.
So you need to prepare the place where your wholesale business will be.
You can do this by cleaning the rooms, adding display counters, adding shelves, adding banners and posters and many more.
As you are preparing your place, it is good to have a picture in your mind of how your customers will access your business, you need to prepare a place for them too.
Tidy businesses attract customers to the business more than unorganised businesses.
You need to be smart and organised in your business in order to scoop as many customers as you can.
Step 6; Startup your wholesale business
Here we come to what we have all been waiting for. the day of opening up.
After completing all the processes of talking to your suppliers and coming to an agreement that they will supply you and also after cleaning and arranging your products in your business, you now need to open up the doors to your customers.
Some wholesale business owners make a grand opening where they make announcements earlier on before they open up their wholesale business and they give the date when they will open their business to the public when the day arrives, they may make a promotion that all products will be at a discount for a given period like a week or month.
This method is good because customers instantly get to know about the presence of your wholesale business and you will indirectly have marketed your business to your customers.
However, if you don’t want to give your products at a discount or you are not a businessman of discounts, there is another way of telling customers about the presence of your new and well-stocked wholesale business;
Step 7; Advertise Your Wholesale Business
An advertisement is a notice or announcement in a public medium promoting a product, service, or event.
After you start a wholesale business in Uganda, you need your customers to know about your presence.
There are a million ways how you can advertise from Social media channels like Facebook to radios, TVs, newspapers, banners, posters and many more.
The method you use for advertisement is not of much importance, however as you are planning to advertise your business to your customers, you need to think about your customers.
Are they literate enough to read newspapers? How many have Tv sets so that I can advertise via Tv, and how many read posters that I can use posters for advertising?
The most effective way of advertising here in Uganda has been on the radio and TV.
But advertisement is not limited to only these two ways.
You can improvise many other methods of advertising, for example, word-of-mouth from your customers to other people who have not yet heard about your business can also work wonders for you without spending much on advertising.
Your Turn…
Here we come to the end of how to start a wholesale business in Uganda in 2021. I wish you success in your quest for starting up a wholesale shop here in the pearl of Africa.
However, you can share with us what type of wholesale business you want to start.
Share with our readers in the comments section below.