Q: I'm interested but where do I start?
A: In order to represent and distribute our Products and Authorized Products you must send in a Distributorship Application for processing. Please contact 1-800-755-8167 Ext. 8147 or (602) 229-8147 to coordinate receiving an application. A distributorship is a franchise business, it is not just a “bread route”. Purchasing a distributorship after qualification is negotiated between Buyer and Seller. The Seller can be a current Independent Distributor or Holsum Bakery.
Q: How do I learn what to do?
A: Holsum Distributor College & Industry Orientation - Holsum offers prospective distributors access to our "Distributor College" and an on truck industry orientation (2-4 weeks depending on experience) to help with the transition of your business purchase. The purpose of "Distributor College" is to introduce each prospective distributor to the key basics associated with wholesale baking Direct Store Delivery 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 how to use the hand-held computer unit. There is no cost for attending "Distributor College"
Q: What experience do I need?
A: Previous sales-related experience is preferred but not necessary. You should understand and be 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 distributorships for sale?
A: You can search for distributorships for sale on this website using the drop down menu under Distributorship on the upper right hand side of the home page. However, distributors are not required, nor do all distributors that have their business up for sale utilize our website. Many use other avenues of marketing, including public listings, Craigslist, Business Brokers, etc.
Q: How do I pick a distributorship that is right for me?
A: Each distributorship business is unique. Selecting a distributorship is a personal decision that only you and your family can make based on factors such as the customer mix, affordability, sales volume, estimated income and expenses, growth potential, established accounts, distance from the Holsum depot/warehouse, distance from your home, equipment needed, and so on. It's a good idea to involve your family in this decision since your business may likely create a different schedule for all of you. Our experiences show that to be successful, you will need their support and understanding of the business. Of course, a good tip is to purchase a distributorship close to your home, or move closer to the business 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.
Q: How do I set up to ride a territory to see what it's all about?
A: When you select a distributorship that you are interested in purchasing, you will need to experience a minimum of one entire business day with the Seller. This will allow you for a better understanding of the industry and the business that you are interested in purchasing. If you do not have a specific distributorship chosen, Holsum may be able to coordinate a ride with an existing Independent Distributor near your geographic area.
Q: What am I purchasing when I purchase an Independent Distributorship?
A: You do not purchase accounts when you buy a distributorship business. Each one has a written description of the Sales Area. Everything within that description is what the Buyer would have the sole distribution rights to for specified Holsum Products. Holsum will not grant distribution rights to another independent distributor in that Sales Area per the Distribution Agreement signed with the Buyer. If a new customer opens in the Sales Area after the purchase, the Buyer pays nothing either to the Seller or Holsum. Likewise, if businesses close after purchase, there is no payment made to the Buyer. Some accounts are higher risk than others, which these may include bid business accounts. The customers that represent the sales volume in a Sales Area will be established at the time you buy your distributorship, but obviously there is no guarantee of future sales.
Q: How do I verify the Seller's figures?
A: Once approval has been given to move forward and you and the Seller have come to the terms of sale, a Sales Packet must be completed. Holsum also has the right to require a business plan from any potential buyer for approval prior to approving any Sales Package. The Sales Package outlines the financial components of the sale. It is an open market for selling independent distributorships and if a Buyer has a need for the selling market average information, Holsum may provide this information. Please take into consideration that it is only an average. The Sales Package lists the accounts that compile the current volume of sales in the Sales Area and shows the net gross sales volume averaged over the past 52-weeks, and calculates the current weekly average gross profit (income/proceeds prior to business expenses). Also included is a Buyer’s Pro-forma to fill out with the Seller to educate the Buyer of the costs associated with operating the route business that they are purchasing. You may ride with the Seller and see what is invoiced at each customer. You will review and discuss the Seller's business documents, tax returns, 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 operate the majority of route businesses for sale, it is inappropriate for Holsum to supply verification of sales data for the Seller of those businesses.
Q: How much financing will I qualify for?
A: Financing is not conducted by Holsum. However, Holsum can provide information on financing options, and put you in touch with a financing provider. Until you select a specific distributorship, many factors cannot be determined, such as your credit worthiness, your debt ratio, the seller's volume verification and the lender's ratio of loan to value. Be patient, and do you due diligence before proceeding.
Q: How much money will I make and how often do I get a paid?
A: Each week an account settlement for the previous week's net sales less your cost of product is conducted. In this business relationship, your business pays less for product than the suggested wholesale price. For charge accounts, Holsum credits your account up front and collects on behalf of your business. Collections are your responsibility for cash business. Your proceeds or discount is the difference between your invoiced sales and your cost of product and is calculated by the level of service (Full Service, Modifed Drop Ship, & Drop Ship) or category of product (Branded, Proprietary, Restaurant, etc.) required by the customer. Depending on the customer or product mix within the route Sales Area, the overall discount may vary; e.g.; Distributor A may have an overall average discount factor of 25% because of the accounts or products distributed; while Distributor B may have a discount factor of 18.5% because of the accounts or products distributed. During the sale process, the Seller will give you specific details regarding accounts and product. Seller's supporting documentation should enable you to verify average sales and income. Although there are exceptions by area, distributors have the following general Product or Service category discounts.
• These are specific product brands traditionally sold to retail accounts. (Nature’s Own, Aunt Hattie’s, etc.)
• These are specific products that can only be sold to specific accounts
• Customer Type: Fast Food, Chain Restaurant
3. Store Brand
• These are products that Holsum is authorized to carry for specific grocers that are the private label for these accounts.
• These are unbranded and usually specialty products for a diverse segment of business
1. Full Service
• Usually for Holsum retail branded products (Nature’s Own, Aunt Hattie’s, etc.) -- you do it all for the customer: order, stock, rotate and credit stale. This service level covers the majority of your customers.
• Customer Type: Chain, independent & club store grocer, restaurant
2. Modified Drop Ship
• Usually Proprietary or Store Brand products-- you or customer order, stock, credit stale; you don't handle all aspects of service for the customer.
3. Drop Ship
• Usually unbranded or grocers' private label--customer orders, stocks, rotates and is responsible for stale; you deliver it. Lowest discounts due to lowest amount of distributor responsibilities
Q: How long is the workday of a typical route?
A: There is no "typical" workday. Each Independent Distributor sets his own schedule depending on numerous variables. These include, their own efficiency, distance from their route sales area to their home, distance to their assigned Holsum depot/warehouse, customer types, service windows, sales volume, and number of customer stops. You are inquiring about purchasing your own distributorship which means your business is to be accessible 24 hours a day, 7 days a week, depending on customer needs and requirements. Typically, Direct Store Delivery Independent Distributors start their workday very early; i.e., 2:00-4:00 am, in order to meet their customers' requirements for service.
Q: Do I get any insurance or health benefits from Holsum?
A: No. As a self-employed Independent Distributor of our bakery products, you are solely responsible for the operation of your distributorship business, including your paperwork, taxes, governmental agency compliance, insurance, benefits, and equipment, as well as the hiring and training of your employees/agents. There are commercial insurers who work with Independent Distributors to provide a wide range of medical, life and disability insurances for your consideration.
Q: How do I take time off?
A: You can hire employees or independent contractors 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 results due to the actions of anyone that is operating your route business.
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. If you choose to use a financial institution for the financing of the transaction there may be a down payment required that may vary based on the terms of the sale.
Q: Will a bankruptcy disqualify me with Holsum?
A: Within three years of applying, it will disqualify you, simply due to credit extension. If it is longer than three years, the Holsum Credit Department and/or outside financing sources will look at particular bankruptcy issues. Holsum requires your business to pay promptly (7 days net) for product when due. This Credit decision is internal and a different Credit check will be done by a financial institution if they are used for financing.
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 "rural" distributors carry chips, snacks, etc. which are produced by other food manufacturers.
Q: Will I be required to have a Commercial Drivers License (CDL)?
A: No, not unless your delivery vehicle requires it. 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 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 vehicle’s 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.
New Mexico: www.mvd.newmexico.gov/Pages/Home.aspx