Starting a Soft Drinks/Beer Dealership Business

Filipinos are generally friendly and happy people. This has been a common observation of other nationalities that I have a chance to work in Dubai. Our happy culture can be seen within our birthday parties, fiesta celebrations, weddings, Christmas & New Year’s parties, and even a simple weekend karaoke gathering.

In every celebration, aside from food, drinks can’t be missing. Filipinos love to drink, be it soft drinks (cola) or strong drinks (beer, rum, etc.). Hence a bottled drink dealership is a promising business in the Philippines.

In 2012, we opened our soft drinks & beer dealership business. For the past 5 years, we have been through ups and downs. This business is not as easy as it looks. This requires physical strength and is best if being managed by men with willpower and endurance.

Location

This is a delivery and distribution business, and it doesn’t require an area with substantial foot traffic. In fact, we are operating our business at our house. All you need is a place with adequate space to store cases of drinks on a massive scale. Your operation is chiefly focused on delivering the cases to sari-sari stores, canteens, and restaurants.

Capital

A substantial amount of money is required for this business. A case of San Mig Light costs P635 on average. If you order 100 cases, you need to shell out P63, 500 in just one unloading. This is merely the cost of the content. The bottles & cases have separate values. If you have no bottles & cases ready, then you have to pay for a deposit of approximately P115 a case. Hence, if you ordered 100 cases, you will pay P11500 for the deposit. Then a total of P75000 is needed to acquire 100 cases.

Supplier

A bottling company like San Miguel taps another company responsible for distributing its products. This company is called a distributor. As a direct dealer of bottled drinks, you will get your supplies from the distributor. When you obtain your supplies from a direct dealer, you are then called a sub-dealer. As a young entrant in this business, you can be a direct dealer or a sub-dealer depending on your capital.

In some companies like RC Cola & Pepsi, we can get our supplies directly from their plants.

While Coca-Cola requires franchising for you to be able to exclusively distribute their products.

(Notice: I will not be able to provide contacts of distributors/suppliers mainly because there are different suppliers on each locality)

Permits

You have to hold licenses to operate your business. You only need to visit your municipal or city hall to get these permits. There you will be guided accordingly with a step by step procedure. This involves getting clearances from the Barangay, DTI, sanitary department, PNP, and Bureau of Fire Protection.

Bottles & Cases

Apart from the content, you need to invest in bottles & cases, or else you will find it a huge burden to pay deposits on every delivery from your supplier. You can purchase bottles & cases from the distributor.

Delivery Personnel

The success of your business depends significantly on the delivery personnel that you employ. The person should be honest and can be entrusted with money. There were instances that our delivery boy declared that he lost his sales that day then for us to find out afterward that the money was never lost. He stole the money.

Your staff should be diligent in selling your products. In this business, it is scarce to get a delivery boy that would stay longer at the job is strenuous, and the pay can be lower than average.

Delivery Vehicle

You need to place a portion of your starting capital to buy a delivery vehicle. As a start-up dealer, the cheapest mode of delivery is a tricycle. But if you have enough money, then it is still best to acquire a small delivery truck. Based on our experience, this is the best and the most effective delivery tool.

Profit

Although this business demands an enormous capital, the earnings derived from it is relatively low. The markup margin per case of soft drinks is 7-9 pesos only. Profit from beers is somewhat higher. Success in this business depends upon the volume of cases being sold.

Disclaimer

EarnPeso holds no control over your financial fate. It is here as a guide. Exercise prudence in every investment or business you undertake, and success will follow.

I hope this article encourages you to start your own business/investment. Click the links for Business Ideas and Investment Options for more insightful essays.

Chat with me

I have ventured into an e-commerce business (online selling) that you might also be interested in setting up. You can visit our website at colibers.com, where you can have a chat with me (just select Contact Us), and I will be more than willing to entertain your questions regarding this post and e-commerce.