B2B, Industrial & Distribution · Seller readiness
Selling a Wholesale Distribution business
Published · Reviewed by The Diligence Standard Team · Updated
Owners should prepare customer/supplier margin, inventory aging, working capital and contract/territory evidence before buyers question durability.
How the business works
Customer and supplier concentration, gross-margin durability, inventory turns, working capital and channel rights determine value.
Issues to resolve
- Inventory is not aged
- Customer profitability is unavailable
- Supplier relationships are owner-held
- Working capital is not normalized
- Freight/rebate income is poorly reconciled
Evidence to request and reconcile
- Customer and SKU profitability
- Supplier spend and agreements
- Inventory aging
- AR/AP aging
- Freight and rebate records
- Territory/channel agreements
Decision questions
- How much margin depends on rebates or favorable supplier terms?
- What inventory is slow or obsolete?
- Can key supplier agreements transfer?
- How much working capital must remain in the business?
- Which customers are low-margin despite high revenue?