To wholesale or not to wholesale: Aligning Volume & Purpose
At every roaster I’ve ever worked for, the goal was to get more retail sales.
Because…full margins.
But for better or worse, my view is that wholesale is a necessary evil for most roasters to sustain their business. However, it doesn’t have to be a strategic-less sales channel.
A strategic necessary evil.
Likely, we both would love to operate a fully direct-to-consumer company and sell all our coffee at full margin. But generally, unless you already have an audience like the Emma Chamberlains or Jimmy Butlers of the world, e-comm is a longer play.
For the rest of us growing from zero, our wholesale programs help us with strategic business objectives like:
Spreading OPEX across wholesale volume
Buying larger volumes of green coffee = increasing our buying power
Selling through fading coffee via blending it out
Marketing, paid for by wholesale accounts in the form of your bags on their shelves
There are dozens of hard businesses reasons to justify a wholesale program and for every hard business operational reason to increase volume, there are equally as many soft reasons to increase wholesale volume. Yet, both the hard and soft reasons will only connect to your team and to your accounts when/if they are aligned with what you’re trying to do as a company, at a macro level.
Define the purpose for your wholesale program.
If you are going to sell wholesale or are doubling down on your wholesale program, you must have an articulated purpose for it.
This will create alignment between you, the owner/leader, and the people who are sourcing, roasting, packing, marketing, selling, and fulfilling each and every wholesale order. Having an articulated purpose for your wholesale program also strengthens your company’s ability to communicate that purpose to your wholesale buyers.
And…if the purpose is wide enough, it can invite your wholesale buyers to actively participate in that purpose with you. Without this, there is an purpose void.
The purpose void.
In a perfect world, when we hire someone, they get a packet of information that articulates every-single-important-thing-an employee-must-know-to be-successful-in-our company.
If we’re honest, this is more aspiration than a reality, because orders have to get out the door, and we don’t have the luxury of a long onboarding processes.
This creates an information void around purpose, especially as it relates to your wholesale program.
Humans seek purpose and meaning to determine their place in this world and they question how they fit into it. They also want to to know how they fit into and contribute to your business.
If you as an owner and leader are not the one to fill this void, they will be left with no choice but to fill it themselves.
To that end, your people need to be reminded why they chose to work for your business, what the business is seeking to do at a macro level, and how your employees and your wholesale accounts fit into this whole thing at a micro level.
Name the void, fill the void.
If we aren’t careful, each employee will fill the purpose void with their own ideas and perspectives. Once this happens, dozens of purposes spring up that have nothing to do with the purpose you have as an owner. Or worse, they’ll end up believing there is no purpose…which is a form of filling the void.
When we are doing this work, it allows us to articulate exactly what it is that we are seeking to do as a business through our wholesale program and growing volume.
Once that has been defined, we can share and articulate the purpose behind why our roastery chooses to buy “that green coffee” versus the alternatives.
Filling this void bridges the gap between your people’s perception of the purpose and your articulated purpose. This articulation allows them as employees to cross the void and end up where you want them to, by aligning purpose and volume.
The void as a catalyst for leadership.
If you don’t say what you’re looking for as an owner or leader, your people will fill in the blank. It’s not their fault if they fill it in incorrectly and go in a direction that you didn’t intend.
In a wholesale environment, this lapse in communication looks like:
A salesperson closing accounts that aren’t aligned with your purpose
A head of green coffee sourcing green that doesn’t align with volume accounts needs
A trainer building a program that doesn’t scale in tandem with growth
A head of production failing to build systems that allow for scale
Our job as owners and leaders is to crystalize, clarify, and contextualize our purpose for our wholesale program so our team can stay aligned and tackle their roles with veracity.