wholesale candy & soda distributor


M

M

I am thinking of starting a business of wholesale candy & soda
distributor. Any suggestions or comments would be welcome.

Thanks
Emm
 
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W

Wayne Brasch

M said:
I am thinking of starting a business of wholesale candy & soda
distributor. Any suggestions or comments would be welcome.

Thanks
Emm
Go for it and good luck!

Wayne Brasch, CPA, M. S. Taxation
 
H

hippo

do you have any clients?
have enough cash to survive while you build up your biz?
do you have a biz infrastructure set up?
do you know or have any experience in your line of work?
growth rate in your industry seems to be flat, how are going
to get customers to switch to your sevices?
my 1/4 cents worth
 
P

Paul A Thomas

M said:
I am thinking of starting a business of wholesale candy & soda
distributor. Any suggestions or comments would be welcome.


I would think (from experience) that most of that is territorial, in that
the manufacturer decides who will distribute their products in well defined
areas.

Do you have connections with the soda and snack manufacturer? Has one (or
more) of them approached you about working a territory for them?

It's tough to get shelf space in the larger stores, and even the smaller
ones won't give up space used by their current inventory.

If you already have an "in", and need advice about what form to conduct
business as, or other questions, then please, get more specific.
 
M

M

To be more specific, I want to target schools, particularly, their
concession stands. The parochial schools in our area are having
parents go out and buy at retail soda, candy etc to sell during school
sporting events. I would like to buy these items at wholesale rate
and sell to the schools myself plus offering them a
"one-stop-shopping" convenience.

Never dealing in "ownership" of a business I am looking for ways to
start, the best tax advantages. ( I would like to eventually take a
check from the co so I don't this I want to stay with sole-proprietor
ship).

Thanks
Emm
 
P

Paul A Thomas

M said:
To be more specific, I want to target schools, particularly, their
concession stands. The parochial schools in our area are having
parents go out and buy at retail soda, candy etc to sell during school
sporting events. I would like to buy these items at wholesale rate
and sell to the schools myself plus offering them a
"one-stop-shopping" convenience.

One of the first things to do is to determine the sales tax status of the
booster clubs that often run the concessions at the schools. I would think
that most are subject to sales tax on their purchases, and I also suspect
they don't want the responsibility of filing forms each month. So in all
reality, YOU would have to charge them a sales tax on what they purchased
from you, collect it, account for it, report it, and remit it to the state,
and/or local jurisdiction ~they~ are in (especially if you deliver).

Regardless of that point, you would have to get a sales tax number as a
"reseller" so you could buy products and not pay a sales tax, and yes, there
is monthly reports to file.

As far as money goes, you'd have to be able to beat their current suppliers.
So make a quick check of the schools surrounding you to determine where they
buy their sodas, popcorn and hotdogs for Friday night's game. Then see if
you can beat that price and still make a profit.


Never dealing in "ownership" of a business I am looking for ways to
start, the best tax advantages. ( I would like to eventually take a
check from the co so I don't this I want to stay with sole-proprietor
ship).

With food products you run a huge risk of liability, so a corporate form may
be best suited if you have significant assets to protect.

That you intend to work the business means that some of the profits must be
paid out in the form of payroll (less the applicable withholdings)

As always, consult a local CPA or EA as to your options in this regard.
 
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A

Amy Gray

I am thinking of starting a business of wholesale candy & soda
distributor. Any suggestions or comments would be welcome.
Do some homework first.

1. Is there a coke/pepsi machine in that building already? They
may well "own" that territory already. If there is a pepsi/coke
machine does that agreement already give the machine owner
rigths to the "entire" building/entire grounds?
2. Check with school authorities. A number of schools
are restricting sales of soda/candy due to the obesity
epidemic.
3. Recylcing. Around here you would be required to
provide some way to accept returns on bottles/cans
that you collected with the 5 cent deposit.
4. Investigate the candy angle. The school may well
have a fund raising agreement with a candy bar company.
That agreement may provide exclusivity to the fund raising
people.
5. Look into sales tax/insurance etc. You may well have to
pay taxes to the city/town/state, etc. Also check the insurance
carefully. Some clown looses his quarter in the coke
machine, tries to shake the machine and it falls on him. Who
is responsible for injuries/damage? Around here some have been
badly hurt by a 5 ton soda machine falling on them after they
tried to get back their quarte or get their soda.

Also are you responsible if some clown breaks into
your stock room at the school and steals stock/taints the stock and
someone gets sick?

6. Does the school have a cafeteria/coffee shop/etc.?
They may have exclusive rights to coke/pepsi/candy
etc. for the school.
7. Check delivery regulations. Around here the city
prohibits deliveries prior to a certain time. Thay may
well be after 10 am if the traffic is bad.
 
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G

Gary V. Deutschmann, Sr.

Hi Emm

There is not as much profit to be realized as one may expect in that
line of businesses.

My brother, ALD Services, Inc. has been in the vending and game
machine business since around 1972.
His lines that provided snacks and beverages were ALWAYS a loss, but
required to get the rest of the vending business with the particular
location.
Roughly 1/2 your gross income is shared with the location, which can
vary by contract and other incentives.
Most of the larger locations, such as airports, require a location
partner or minority influence.

I don't want to whittle away at your drive to succeed, there are still
many market niches open and available to small and start-up operators.
But you can be rest assured that the GOOD locations are most often
locked up by the big guys, who will often overdo a location at a
calculated loss, just for their own ego trips.

The equipment is HEAVY, the expiration dates on snacks is SHORT, and
the breakdowns and breakins are many.

At one time, there was good money in the business, now it's just
barely break even for most vendors.

TTUL
Gary
 

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