Price: $102,000 – Weekly Sales: $14,106
This listing is for a Mission tortilla distribution route with a price of $102,000 including the 2004 Freightliner M2 Business Class 40 ft Box truck with 3,000lb capacity lift gate. The warehouse for product pickup is in Natomas and the accounts are primarily in North Highlands. This route is currently averaging $14,106 per week in sales volume over the last 52 weeks and $15,692 per week in 2020! The route generates approximately $2,400 per week in gross commissions with it’s 17% commission rate. This territory consists of established major grocery accounts and has great growth potential. Flexible schedule with four delivery days and three merchandising days necessary per week.
The distribution rights and protected territory are purchased through the current route owner and contracted through the product manufacturer Mission Foods/Gruma. This route has major retail accounts including Walmart, Foodmaxx, Grocery Outlet and the Air Force base commissary. This is a turnkey wholesale distribution route opportunity with consistent sales volume and support from a name brand food manufacturer. Full training will be provided.
WHAT ARE THE DAILY RESPONSIBILITIES OF THE ROUTE OWNER?
The route owner is responsible for servicing their customer base and ensuring that product is well stocked and maintained for the consumer. Route owners will order, deliver and stock product accordingly. The current owner makes deliveries Monday, Tuesday, Thursday and Friday. Quick merchandising/restocking is necessary on the other days. Additional merchandising can be necessary at busier accounts during holidays or large promotions but that work can be easily outsourced if the owner chooses to do that. The route owner will work with company and account management teams to ensure that sales are being maximized and there are no service or inventory issues.
GROSS EARNINGS/COMMISSIONS
This route is currently averaging approximately $14,106 in weekly sales volume. With an average commission rate of 17% the owner generates $2,400 per week in gross commissions. The sales volume can be confirmed through sales reports/invoices. Sales reports and other information can be provided once we receive an NDA submission.
OPERATING COSTS
Typical expenses include fuel/gas, vehicle insurance, vehicle maintenance, commercial liability insurance (often added on to vehicle policy), route payment (depending on whether financing is used), and handheld/printer/warehouse expenses. The current owner estimates $300 per week in route operating expenses. Operating costs will vary from owner to owner depending on a variety of factors.
GROWTH POTENTIAL
Nearly every route has growth potential both within the current accounts or by adding new customers to the route. The route owner can work with current accounts and company managers to maximize sales volume. New accounts such as independent grocery stores, restaurants, schools, hospitals and other accounts could potentially be added to the business as well. The company sales managers do provide support with these growth efforts.
FINANCING
No company or owner financing is available for this route
VEHICLE AND OTHER EQUIPMENT
The current owner will include their 2004 box truck with the route or remove it from the deal if the buyer does not need it
INVENTORY MANAGEMENT
One of the biggest responsibilities for route owners is inventory management. Route owners “purchase” product from the company and then resell it to their customers. They earn a designated commission which is added on to the cost that the store/customer pays for the product. The route owner does NOT pay for product upfront. Instead, the route owner is put on credit terms with the company and they balance your account on a weekly basis. For example, if you order $5,000 worth of product from the company in one week but also invoice $6,000 worth of sales to your stores, the company will issue a settlement check to you for the $1,000 difference. Returns/stale and damaged product are handled differently by each company but are generally covered and reimbursed for bread routes.
TRAINING
The current owner has agreed to provide full training to the buyer. In addition to training from the current route owner, the company will provide some assistance when possible and will always provide administrative/sales support. The manufacturer wants their route owners to be successful so you will have a solid support system behind you.
SCHEDULE
The route owner simply needs to make sure that their customers are taken care of, inventory is being managed properly, and sales are being maximized.
Owning a route means that you are an independent owner/operator/contractor. You are ultimately responsible for the success of the route operation and you will need to find route coverage if you are sick or on vacation. Most route sellers and existing owners have a coverage person whose contact information they can share. Otherwise you are free to train someone to run your route while you are unavailable. It can require some effort and coordination to setup time off…but it does provide a lot of flexibility once you have a person or two that can cover your route operation when requested.
PURCHASING PROCESS AND REQUIREMENTS
Route buyers will have an opportunity to meet with both the current route owner and the management team at the company. You will need company approval to purchase the route and they may ask for a simple business plan. Background and driving record checks may be necessary as well. Most companies are requiring that route owners are incorporated so that they are personally separated from the business. The incorporation process is relatively straightforward for most states and can typically be completed through your state’s secretary of state/business registration website.
REQUEST MORE INFORMATION
Our route blog is a fantastic place to find more information on the distribution route business. There are a wide variety of articles including overviews on different types of routes (bread, snack, vending, etc) and others that discuss general route operating topics.
If you are interested in acquiring more information on this route please submit our non-disclosure agreement here. Please note the route number or route location on your NDA submission so that we can send over the correct information.
If you have any other questions please feel free to contact us through this form or by email at Jay@TheRouteExchange.com