The Wholesale Distribution Business

How these numbers were built: industry size and establishment counts come from the U.S. Census Bureau (Wholesale Trade, NAICS 42, Merchant Wholesalers); wholesale sales-rep wages and labor cost come from the U.S. Bureau of Labor Statistics (SOC 41-4012); inventory turns and operating benchmarks come from the National Association of Wholesaler-Distributors; the owner cash flow band, the revenue range, sale prices and multiples come from BizBuySell’s 2021 to 2025 sales of small distributors; gross margin comes from Census merchant wholesaler data; warehouse rent comes from JLL’s national industrial asking rent; what larger distributors earn comes from the Distribution Strategy Group’s 2025 profitability report; the cost to open comes from the opening kit, priced line by line from forklift, racking, vehicle and barcode equipment dealers and insurance quotes, with the opening stock sized to the model’s own cost of goods; financing terms and the size standard come from the SBA; and the five-year survival baseline comes from the Census Bureau’s Business Dynamics Statistics. Every source below links to the underlying public material so you can check any figure yourself. These are starting assumptions for a small owner-run distributor, thin on margin and heavy on working capital; the moment you enter a real company’s sales volume, buy price, turns, and cost structure, your numbers should replace ours. Figures are current as of 2025-2026 and refreshed as the sources update.

The owner cash flow band, the revenue range and sales per warehouse come from BizBuySell’s 2021 to 2025 sales of small distributors (median sales about $1.4M, owner earnings about 17%); gross margin and cost of goods follow U.S. Census merchant wholesaler data (about 27% gross margin on durable goods); the warehouse and logistics share is built from JLL’s national industrial asking rent on a small warehouse plus one leased van or truck; labor is sized as one warehouse and delivery hand with part-time office help, inside a band drawn from BLS wage data. Larger distributors’ figures (2 to 4% pretax profit, payroll about 15% of sales) come from the Distribution Strategy Group. Inventory-turn and DSO figures are directional operator norms. Validate against a specific company’s books before relying on these numbers.