Wholesale May 2017

Wholesale commerce involves selling to distributors or retailers. It would seem like a wholesale tool is the opposite of what we should build by that definition if one assumes that makers selling to end users is the optimal form of commerce. This shows a failure to empathize with the consumer of the product. Wholesale exists because it creates value for the consumer in other ways. It will happen more in the future, not less.

Historically, trade was flat. Distributors and retailers were added to the supply chain to meet consumer requirements like variety, convenience and service. Flat trade is worse because it cannot solve for all the other aspects that go into a purchasing experience. Other aspects like service, locality, variety, convenience matter as much as product.

Middlemen who create less consumer value, like Sears, are replaced by middlemen who create more value, like Amazon. Our mission is to make wholesale better for everyone involved: the wholesalers, the wholesaler buyers and the consumers. If we create the best alternative for wholesaling, we will win the market for wholesale tools.

Why bother trying to create new wholesale tools at all if there are existing solutions? When you talk to wholesalers, they are rarely happy with their tools. The opportunity to create a superior alternative is huge. Merchants are unhappy with their tools for a variety of reasons but the main one is the manual interactions make it hard to scale.

We are not building: a marketplace, an EDI system, a fax, email or phone ordering system, an ERP system, an online store clone or a CRM system. All of these technologies can be rightfully be considered ways to enable wholesale, and none of them reflect what we should build to meet the needs of wholesale merchants.

Wholesale is a key part of making commerce better for everyone. Solutions exist that implicate in person, offline interaction as well as scaled online interactions. The issue is that no one has solved wholesale tooling at scale in a way that meets the needs of a current wholesale buyer without having to build it yourself or do it offline.

Failure means our work becomes infeasible or our processes fail. We should set out to build the opposite, a tool that does wholesale well enough online to satisfy the needs of both the wholesale merchant and the wholesale buyer. If customers have a better way to wholesale, online or offline, we have failed to create a superior alternative.

Ultimate success would be improving the customer experience of the wholesale buyer. If we are going to provide a tool that provides direct to consumer merchants a way to sell wholesale, we need to understand the wholesale buyer. Wholesale buyers want products that are easy to discover, compare, order, track, pay for, sell and reorder.

Good systems augment what people already do while bad systems try to replace the people. We will measure our success by looking at the weekly GMV growth of our alternative, compared to the growth of the broader wholesale market and tools. Our solution needs to grow faster in adoption than the broader market for other alternatives.

Most of our existing customers already wholesale. Some wholesale offline, some do it using marketplaces and others do it in person. Of those who do not wholesale yet, it can often be attributed to a lack of appropriate tools available that make it easy and scalable enough to support as the direct to consumer side of the business grows around it.

The focus on the general needs of wholesale merchants and their buyer should outnumber a focus on competitors, alternatives and loud customers 99:1. This will allow us to ship things when they benefit any wholesale merchant, rather than every wholesale merchant. It will also allow us to fix bugs before building new tools.

To prioritize what to build, we can separate new features into four categories. The categories are: cannot ship without, need to have, nice to have and do not build. Each feature inside a category can be ranked from one to n and we will move through them in order. The do not build category should outnumber the other three combined.

Each time we build something new, we should ask: if we were to start over, would we build the same product in the same order? If not, what should we do differently? It is easy to know what to build next when you are behind the expectations of the market. It is harder when you are trying to build a superior alternative to know what to build next.

We need to understand how feasible the product is. We need to ensure the solution is usable for the wholesale buyer as time passes and new features are added. We need to best serve the persona of the wholesale buyers using our tools to win the market.