FAQs
Q: I'm interested but where do I start?
A: In order to represent Holsum on the route you purchase from a Seller (the current Independent Distributor), you first need to be qualified by Holsum before you would enter into a Distributor Agreement together. In order to get quailified by Holsum you must fill out the Distributorship Application.
Distributorship Application »
Q: How do I learn what to do?
A: HOLSUM DISTRIBUTOR COLLEGE & ORIENTATION
Holsum requires all prospective distributors to complete our "Distributor College". This orientation generally must be completed before you start your distributorship. The purpose of "Distributor College" is to educate and sharpen each independent distributor's skill base and understanding of the key basics associated with wholesale baking DSD so that each distributor has the opportunity to maximize sales growth. This program covers such topics as product ordering, report familiarization, paperwork organization and retention, product distribution, service fundamentals, and use of the hand-held computer unit. There is no cost for attending "Distributor College" and attendees are reimbursed reasonable costs for their attendance. Holsum will also provide an on truck orientation (2-4 weeks depending on experience) with an orientation specialist to help with the transition of your business purchase.
Q: What experience do I need?
A: Related experience is preferred but not necessary if you understand and are committed to do what is required to be a successful business owner. Your customers, the Distributor network, and Holsum will rely on that commitment.
Q: How do I locate routes for sale?
A: Search for Routes for Sale at this website using the drop down menu on the upper right hand side of this page.
Q: How do I set up a route ride to see what it's all about?
A: When you select a route to buy, you will meet with the Seller, ride the route, check out the vehicle, look at the Seller's books and tax returns, etc., to determine if this is the route for you.
Q: How do I verify the Seller's figures?
A: Once you and the Seller have come to terms, you will complete a 2-page Sales Packet. Page 1 outlines the components of the sale, lists the stops, shows the net gross sales volume averaged over the past 52-weeks, and calculates the current gross profit (income or proceeds). Additionally, you will ride with the Seller and see what he invoices at each customer. You will review and discuss the Seller's business documents and route accounting paperwork, such as invoices and handheld reports until you are comfortable that the figures presented to you are accurate.
Since Holsum does not own or run the route business, it is inappropriate for Holsum to supply verification of sales data for the Seller.
Q: How much money will I make and how often do I get a paid?
A: Each week you receive a check for the previous week's sales less your cost of product. You receive cash directly from non-charge accounts. Your proceeds or margin is the difference between your invoiced sales and your cost of product and by the level service required by the customer. For example, although there are exceptions by route, Arizona and Nevada metropolitan Distributors have the following general service margins.
- Full Service @ $.20/Dollar
- Service: For Holsum retail branded products--you do it all for the customer: order, stock, rotate and return stale on code for credit from Holsum. This service level covers the majority of your customers.
- Customer Type: Chain, independent & club store grocer, restaurant
- Modified Drop Ship @ $.15/Dollar
- Service: Usually unbranded or private label--you or customer order, stock, credit stale; you don't do it all for the customer.
- Customer Type: Some fast food accounts, bid accounts
- Drop Ship @ $.10/Dollar
- Service: Unbranded or grocers' private label--customer orders, stocks, rotates and stands stale; you deliver it.
- Customer Type: Chain store, independent grocer, club store
Depending on the customer mix within a route Sales Area, the overall margin may vary; e.g.; Distributor A may have an overall margin factor of 18.5 because he serves a fast food account; while Distributor B has a margin factor of 17.75 because he does private label business. To be a full "20", the Distributor would serve only accounts with service at the $.20/Dollar margin.
During the sale process, the Seller will give you specific detail by account and level of service. Seller's supporting documentation should enable you to verify average sales and income. Since Holsum does not own or run the route business, it is inappropriate for Holsum to supply verification of sales data for the Seller.
Q: How long is the workday of a typical route?
A: There is no "typical" workday. Each Independent Distributor has different work hours depending on their own efficiency and the distance from their route sales area to their home and their assigned Holsum Depot, customer types, service windows, sales volume, and the number of customer stops. You are inquiring about purchasing your own business which means your business is to be accessible 24 hours a day, 7 days a week. Holsum Independent Distributors generally start their workday at their Depots very early; i.e., 2:00-4:00 am, in order to meet their customers' requirements for service.
Q: Do I have to go out and get my own accounts?
A: You do not purchase accounts when you buy a route. Each route has a written description of the territory perimeter. Everything inside that perimeter is the route Sales Area, the "dirt", in which the Buyer will have the sole distribution rights to represent Holsum products. Holsum will not grant distribution rights to another distributor in that Sales Area per the Distribution Agreement signed with the Buyer. And, if a new customer opens in the Sales Area after the route purchase, the Buyer pays nothing either to the Seller or Holsum. Likewise, if a stop closes after purchase, there is no payment made to the Buyer. Your customers will be established at the time you buy your distributorship. If there is a non-stop or new customer on your route, notify your Business Development Specialist who will assist you in ordering product samples and setting up a sales call together.
Q: Do I get any insurance or health benefits from Holsum?
A: Legally, Holsum as your bakery supplier, cannot offer you benefits as you are not an employee of Holsum. There are commericial insurers who work with independent distributors to provide a wide range of medical, life and disability insurances for your consideration. Remember, as a self-employed Independent Distributor of your bakery distributorship, you are solely responsible for the operation of your route business, including your paperwork, taxes, governmental agency compliance, insurance, benefits, and equipment, as well as the hiring and training of your employees/agents.
Q: How do I take time off?
A: You can hire agents or employees for your route operation and, yes, you can arrange for time away by hiring vacation relief drivers, some of whom freelance their services directly to our Independent Distributor network. However, you are responsible for the training and performance of your employees.
Q: How much money do I need to put down on a route purchase?
A: The terms of the sale are set by the Buyer and Seller.
Q: How much financing will I qualify for?
A: That is a difficult question to answer at the beginning of this process, even though it's one that is important to you. Until you select a specific route, it's like asking what financing will you get on a house in Phoenix, but not identifying the house. There are many variables that a lender will consider--your credit worthiness, your debt ratio, the seller's volume verification and the lender's ratio of loan to value. Be patient and the facts will become increasingly apparent in order for you to make the best decisions.
Q: Will a bankruptcy disqualify me with Holsum?
A: Not necessarily, but our Credit Department is going to look at how long ago the bankruptcy was filed, why it was filed and what you have done since. If you cannot manage your personal credit well, then adding a business will make it that much more difficult for you to succeed. Holsum requires you to pay them promptly (7 days net) when due.
Q: Can I carry other products?
A: As an Independent Distributor, you can carry other lines and products as long as: 1) those products do not compete (other bread companies) with your best efforts obligations to represent and market Holsum products; and 2) that they do not contaminate the sanitary condition of your bakery vehicle.
Many of our "outside" distributors carry chips, tortillas, cookies, pies and cakes which are produced by other food manufacturers.
Q: Will I be required to have a Commercial Drivers License (CDL)?
A: No. Your bread delivery vehicle system may consist of a box truck, step van, trailer, or a combination of any of those, to get your product to your customer per their requirements in a sanitary and uncrippled condition on time. You may purchase the Seller's vehicles that are usually configured to access their customers in one trip, or you may purchase your own. You are only required to obtain a Commercial Driver’s License (CDL) if you’re the total Gross Vehicle Weight Rating (GVWR) is 26,001 pounds or greater. You may find your GVWR on the VIN plate on your vehicle. If your vehicles combined GVWR is less than 18,000 pounds you are exempt from Commercial Vehicle Regulations. If your combined GVWR is 18,001 or greater please refer to the Motor Vehicle Department in your state for guidelines. You can follow the following links for more information.
Arizona Department of Motor Vehicle
Nevada Department of Motor Vehicle
California Department of Motor Vehicle
New Mexico Department of Motor Vehicle
Utah Department of Motor Vehicle
Which Route Is The Right One For You?
Each route is unique. Selecting a route business is a personal decision that only you and your family can make based on items such as the route's particular customer mix, affordability, sales volume, income, expenses, growth potential, established accounts, distance from the Depot, distance from your home, equipment needed, and so on. It's a good idea to involve the family in this decision since your business may likely create a different schedule for all of you. To be successful, you will need their support and understanding of the business.
Of course, a good tip is to purchase a route close to your home, or move closer to the route you purchase. This cost-effective proximity to your business allows greater efficiency in serving your customers and improved frequency in checking your market, which is a great competitive edge.
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