Let's Do Business

https://instaud.io/2hFz : let’s do business

Today I was asked how to built a company that became the main distributor in a vast region. Trading company of course. So instead of answered for long, I choose to wrote it not too long. I feel more relaxed. So let's get started.

Before we talk further about the system we first need to decided what is the main income for the company and set the strategy in marketing also how to manage the revenue.

After that, we determined where the business will be built by weighing the most strategic position to reach the entire distribution area, taking into account the convenience of transportation and operational expense for distribution. At this time we also must decide whether to make the company big enough to become a brand image for the region or not, so we could make selection where the right company position.

Second we need a management system that includes the system of purchase, sales and marketing, inventory, accounting system, IT system and worker and employee system.

Third we need supplier which could we expected to be trusted and reliable and would like to accommodate our market needs.

That's all it takes to build a distribution company.

The details are rather long. Because when we talk of location and building, we would talk about legal and the cost of establishing the company. Also the ease of corporate location to reach both by customers or buyers and employees.

When we go into the management system we have to discuss one by one which involved in it.

Purchase system: whether to cut off buying or consignment. Who carried the cost of transportation up to the warehouse and who would bear the cost of insurance.

System sales: whether selling cash or on account. Direct or indirect sales. And define the standard rules about customers and buyers.

Inventory system: decided whether to use FIFO, LIFO, or average system. Generally FIFO (first in first out) is more widely applied because it makes more sense.

Accounting system: included recording all transaction that occured within each system. Including corporate income management.

IT System: needed to facilitated the control of transaction recording and speed of service to customers or buyers.

Worker and employee system: organized all policy about employees working in the company, for example about working hour, over time, salary level, furlough, and so on.

It seemed that this is just the first step required in setting up a trading company. The rest should be described in more detail in each section. The most needed are people who are reliable and trustworthy, able to work, honest and dedicated. Especially at the middle management level.

I hope my answers clear enough. And this is indeed a kind of trivial fun in my daily life.

Ciaao