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Business Idea : Distribution FMCG

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Business Idea : Distribution FMCG : If we look around in our daily lives from morning to night we use number of FMCG products starting from a tooth paste, soaps, shampoo in morning. Cereals, juices, tea, fruit jam, bread and ketchup on breakfast table. The list of items goes on till evening.

There are different companies producing these products in their factories. But it is of no use if these products do not reach till final consumers. Let’s understand the whole process through a chart

Whole Sale

As the above flow chart shows goods produced in factories reach the final consumer through four channels CFA, Distributor, Wholesaler, and Retailer. In this article I will explain how to set up a distributor business in India.

Who is a distributor?

Distributor is one of the most important link between products produced in a factory  finally reaching their end user or consumer. They purchase in bulk from CFA or in few cases directly from factory and then selling them to wholesalers/retailers in their nearby area. We learn about these channels separately.

Steps for setting up a Distribution Business

  1. Legal Requirement
  2. Infrastructure Requirements
  3. Manpower Requirement
  4. Safety Requirements

Legal Requirements:  Before starting any business there are certain statutory requirements to be fulfilled as listed below

  1. A Valid GSTIN number
  2. FSSAI License
  3. Trade  License from competent authority like Municipal Corporation
  4. Bank Account
  5. PAN Number

Infrastructure Requirements:  For smooth storage and supply there are certain requirements as below

  1. Warehouse with proper flooring and ventilation
  2. Vehicles for supply to retailers
  3. Computer and Printer for billing of goods to be supplied with an accounting/billing software like Tally/Logic/Marg/Busy

Manpower Requirements:  For booking and supply of products manpower is required as below

  1. Salesman for order booking from retailers
  2. Accountant/Computer Operator for processing of orders collected by salesman
  3. Warehouse Manager for supervision of loading and unloading of goods and stock maintenance
  4. Drivers for supply of goods
  5. Helpers for loading, unloading and supply of goods in market

Safety Requirements:   Safety of products and people engaged in work is of utmost important

  1. Fire extinguisher  in case of emergency
  2. Rodent Traps
  3. Proper electric wiring without any lose ends
  4. Proper washroom facility for staff

If you are ready with all of the above requirements your Business Idea : Distribution FMCG is ready to start.

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