View Full Version : What should I expect from a Distributor?
07-08-2006, 07:37 PM
Hello..very new to this and was hoping some kind soul could at least point me in the right direction. Links to posts that may already cover this subject also appreciated.
I will be opening a Gamer Cafe in the next few months and selling Bevs will be a major revenue stream for me. Clients will be tweens and University kids...pop and Energy drinks mostly I suspect.
When I am shopping for a distributor what should I expect from them? How does this biz work?
1. What will I be paying for the pop/drinks? What kind of profit margin can I expect if I sell at same rate as C-Store?
2. Coolers? Supplied to me as long as I sell a certain amount free of cost or do I pay upfront/lease?
3. Payments terms? On Delivery? 30 day?
4. What kind of volume do I need to generate to keep them servicing me?
5. What big thing have I missed that I should be asking? As I said, very new? Incentives, norms etc.
Thanks again and I look forward to hearing what you may have to say on the topic.
07-10-2006, 03:00 PM
All I can say is don't sign an exclusive or limiting contract with any one vendor... the type of customers you're after in the teen/20s always want something new and different CONSTANTLY and if you lock yourself into one company/type of drink you're stuck with just that...
It's not to say snub yur nose at one... but don't hesitate investing in your own coolers and let the companies want to offer you specials or good prices to work their way into your coolers...
if you're pumping from the fountain and get into a contract to get the equipment you're pretty much stuck with one company there but make sure it doesn't stop you from offering other drinks in other forms... read fine print... they'll hold you to it or threaten to yank equipment out for violations as their way for forcing you into their products.
all my babbling aside... I'd have a nice fridge in back to store cases cold, and one or two coolers up front where people can see and grab products they want to look at or try... glass bottled soda if available (it says hey I'm snazzy and premium) or snapple style premium beverages?
07-10-2006, 03:40 PM
Gamers will be looking for new "hip" beverages, Energy Drinks, Enhanced Waters, RTD Coffee and Teas, Good luck. My advise is make 4O% profit margin, typically a Soda Distributor will sell you a soft drink for somewhere around $.80 you could expect to retail it at $1.29 that would bring you approx 40% If you get into energy drinks the margins will be higher. Cost will typically be around $1.30 and retails around $2.19 although the margin is the same penny profit is higher. And in your business you need penny profit.
07-10-2006, 03:42 PM
I forgot to answer another of your questions, Most distributors will stop for 10 case purchases. Some smaller distributors may stop for 5 cases.
07-11-2006, 07:43 AM
Thanks for all your replies. They have given me a least a place to start in my hunt for a distributor and some good info on setting up the place as well.
07-11-2006, 12:03 PM
Dont go with the big corp. guys (Coke, Pepsi), for your clientel, as NRG said, they want Energy Drinks, BAWLS, JOLT, good tasting Lemonaids and refreshers. Most of your clientel will hopefuly be there for hours on end, and any all night LAN parties, your drinks and snacks will be a big part of your revenue. Most internet cafes I services would sell most energy drinks for around $2 - $2.50 (US) and make about 50% on most other items. But you really have to change that figure depending upon your clientel and how eger they will be to pay $2 for a Jolt Cola.
The most important thing to remember is to always make sure you have plenty of "servable" product. Treat your cafe like a bar, never run out of stuff that makes you go to the back to get more. Customers hate waiting and warm drinks. I know that is elementary but it is important none the less.
If customers feel as though you are not prepared for them they may leave and find a more suitable atmosphere.