Why should one have own whole sale distribution firm rather than appointing distributor for pharma franchise marketing?

Question:

The main question that was asked by our one reader we received is – Why does one should have own whole firm rather than appointing distributor for franchise marketing?

There is two way to start pharma franchise marketing. Either you can appoint distributor as stockist and start working at franchise basis or you can own your whole sale drug license number and GST identification number ,and start doing marketing & distribution at own basis.

Both way is good to start pharma franchise marketing. But one question is always asked by our reader is that which way is better as compare to other. Having own whole sale license or appointing distributor.

Read this article Will it be advisable for me that I appoint a stockist?  

In starting one should go with appointing stockist but after some time owning own firm is best option. At small scale stockist will be best option but after a level, one should go with own firm.

Now question arises why should appoint stockist in starting?    Establishing own distribution firm is tricky, costly and time consuming process. For pharma distribution firm, one need to have wholesale drug license number and GST number.

For documentation and procedure, you can visit our article – how to start pharma distribution business? One must also have to register under FSSAI also because many products will come under food and dietary supplements also. So, start with appointing stockist.

But appointing stockist has one main and important disadvantage that one would like to avoid in all cases i.e. no one would like to show that company is a franchise company and you are getting products at net rates. If you have your own firm, then rates and other things will be secretes in market. That is the main reason why one should have own distribution firm.

In stockist case, one have to pay a certain percentage i.e. normally 10% but distributor will handle distribution and in some cases collection also. One should only concentrate in marketing and sale, so he can establish his market presence but when he feels he is getting enough to pay his bills, expenses and ready to move froward. He should start procedure to establish his own wholesale firm.

As we have discussed in our article Will it be advisable for me that I appoint a stockist? Both ways have their own advantage and disadvantage. Initially you can take risk of appointing stockist or distributor but not with your established franchise marketing.

Basic problem one can face during franchise marketing, you can read in our frequently asked question section: Frequently Asked Questions

For any query and suggestion mail us at pharmafranchiseehelp@gmail.com