How to Start a Seafood Distribution Business in 8 Steps

By
Joanna Okedara
Table of Contents
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    If you are doubting the profitability of the wholesale seafood and seafood business ideas, then think again. According to stats, the market size by revenue of the fish and seafood industry in the U.S. was 3.7 billion dollars in 2022.

    Additionally, the size of the fish industry has grown by 4.3% per year on average between 2017 and 2022. With the recent increase in the per capita consumption of fish and seafood, there is an increasing demand for wholesale fish in the US.

    Key Takeaway: According to NOAA, America imports somewhere between 70% and 85% of its seafood. Over 6 billion pounds of seafood worth over $21 billion were imported into the United States in 2020, resulting in a $17 billion deficit in the country's seafood trade.

    You can deduce from the statistics above that starting a wholesale seafood business is a lucrative business idea. This article will help you understand how to become a seafood distributor and give you tips on how to start a seafood wholesale business.

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    Seafood Distributors: The Ultimate Checklist to Become a Wholesale Seafood Distributor

    The seafood distribution industry is such that fish farmers sell fish in bulk to licensed seafood wholesale distributors. Seafood distributors are then responsible for selling wholesale fish to restaurant businesses, supermarkets, grocery stores, and fast food chains.

    Wholesale seafood distributors in the U.S. purchase seafood products from a variety of licensed seafood vendors and suppliers. After purchasing the required amount, wholesale seafood distributors go on to store the seafood and fish in a cold-room warehouse. Distributor seafood are also responsible for managing and delivering orders, either online or in-store. 

    Just like any other typical B2B eCommerce and distribution warehouse business, you cannot have just one supplier or seafood vendor. Vendor management solutions will make it easy to keep track of fish and seafood suppliers.

    Before you start your wholesale distribution business, it is important to understand the business model you want to adopt for your seafood business. Some wholesale seafood distributors specialize in a specific type of seafood, like shrimp distributors - the most common in the U.S.

    Other seafood wholesale distributors, sometimes called broadline distributors, buy and sell a full line of all kinds of seafood products according to the needs of their customers. Another model is focusing on the unique needs of your niche market.

    For instance, if your target market are seafood restaurants that offer signature fish tacos or seafood nachos, then you may need to sell the seafood products that are the main ingredients in their recipes. Some luxury fine dining restaurants also demand fresh seafood based on customers’ requests.

    Let’s look at the ultimate checklist on how to become a seafood distributor and how to start a seafood wholesale business. 

    wholesale-seafood-distributor-ebook-download

    Top Wholesale Seafood Distributor Checklist: 8 Things to Do

    So, what do you need to become a wholesale seafood vendor? Let’s find out together.

    • Choose your business model
    • Write a business plan
    • Find reliable suppliers
    • Know your customers
    • Get your warehouse ready
    • Obtain your wholesale license
    • Streamline your wholesale business with software
    • Go eCommerce

    Don’t get overwhelmed yet! Let’s review each item on the checklist and help you understand what you need to tick each each in order to bring you a step closer to starting your seafood wholesale distribution business.

    challenges of seafood industry

    How to Start a Seafood Wholesale Business in 10 Steps

    1. Choose the Business Model

    The business model for seafood distribution is a bit different from other wholesale foods distribution businesses. With various challenges in the seafood industry, it is important to decide early on the type of model you want to run.

    For instance, climate change issues and species seasonality may make it difficult to find some species of seafood at particular times of the year. If you choose to sell one type of seafood, it is critical that you have a backup plan in such cases.

    It is easier for broadline distributors to navigate through slow seasons, shortages and underfishing. However, it is critical you have vendor management best practices in place. This will ensure your wholesale orders get top priority.

    1. Write a Business Plan

    A business plan is a guideline on how you want your business to operate. Having one in place will save you the troubles associated with running your business without a plan.

    Are you looking for a simpler way to create a flow diagram for your wholesale seafood distribution business? You can use our editable business process flow chart to streamline and optimize your business processes. Download our free business process flow chart template here.

    Add the following sections to your wholesale business plan:

    • Executive Summary: An overview of your product, the market, and possible growth areas is provided in the executive summary.
    • Company Description and Goals: Describe your company, your target market, and the resources you'll need to run it in the overviews and goals section.
    • Products and Services: Details on the particular wholesale seafoods that your business will provide.
    • Market Opportunities: Analysis of consumer demographics, buying trends, and product demand.
    • Distributor Marketing Strategies:  Describe your consumer outreach strategy and how you intend to stand out from the competitors.
    • Competitive Analysis: A review of the advantages and disadvantages of your rivals.
    • Operations: The organizational structure of your business and the conditions necessary for daily productivity.
    • Financial Evaluation: Outlining operational budgets, forecasts of upcoming costs, and total costs.
    1. Find Reliable Suppliers

    There are various options on getting seafood supply. 

    • Commercial fishermen: Make sure you come to an agreement with more than one commercial fisherman. Manage all your suppliers with a vendor management software to make things like invoice processing, B2B payments, and service delivery management easier.
    • Other wholesale seafood businesses: You can also buy in bulk from other seafood distributors. If the business has a huge stock and warehouse then they’ll probably sell to you in bulk as well.
    • Seafood processing plants: Most seafood processing plants buy in large quantities from commercial fishermen or catch their fish themselves. 
    • Primary processors typically shuck or boil raw shellfish, remove the edible meat, or process whole fish into fish fillets, steaks, or loins. These edible pieces are then packaged and sold as fresh, chilled products or are frozen before being distributed to wholesalers, retail outlets, or restaurants. 
    • Fish and shellfish items, whether fresh or frozen, are transformed by secondary processors into the finished goods that are sold in grocery stores and restaurants. Seafood entrees and meals, sushi, salads and sandwiches with fish, and smoked seafood items are some examples of processed seafood products with additional value.
    • Do it yourself: If you have the financial resources, equipment, and right team in place, you can catch your fish yourself and sell it wholesale. However, you need to obtain a commercial license to do this.
    1. Know your Customers

    Seafood markets, supermarkets, restaurants, co-ops, and other businesses can all be potential wholesale seafood customers. The sort of seafood that the buyer wants, along with whether they want it fresh or frozen, will be specified in the order.

    You'll probably have an advantage over your competitors if your wholesale seafood business sells specialty seafood that can be difficult to get elsewhere. Blue crab and even premium Alaskan salmon are two examples of the specialized seafood. 

    Additionally, you can sell your seafood to mobile vendors or online retailers while charging retail prices. Remember that the cost of bulk fish can vary depending on the retail price.

    1. Get your Warehouse Ready

    It is important to get a suitable storage and warehousing facility ready. From having a well-lit facility to using the right warehouse layout, the tiny details matter when it comes to storing wholesale seafood.

    The warehouse must also meet up with the sanitary requirements of the state health department. Ensure that the building has adequate drainage with no contaminant falling from the walls or ceiling.

    Your on-site refrigeration and freezer facilities must be ready to go as well. If you plan to deliver seafood to customers then you must also have clean and sanitized refrigerator trucks. Having equipment that will ensure safe handling and seafood shipping in the warehouse is also important.

    Using a warehouse management system is a great way to manage your seafood warehouse. When integrated with a wholesale ERP system, your warehouse management software can help you increase the profitability of your wholesale business.

    The major objective of a warehouse management system is to help in controlling and managing daily operation. A warehouse management system makes warehouse operations easier by not only directing the seafood wholesale inventory that is received but also by optimizing order picking and bulk shipping.

    1. Obtain your Wholesale License

    To sell fish, you typically need a license. For instance, any wholesale dealer operating in Louisiana must have a license. Distributors, fish farms, processing facilities, and anyone shipping fish fall under this category.

    It is advisable to confirm the license requirements set forth by each state if you want to sell seafood to several states. Certain states mandate that you keep track of what you sell. 

    Species, amount, and license information from the store where you bought the seafood can all be included in this. Your documents and files should be kept for at least three years.

    1. Streamline your Wholesale Business with Software

    Integrating wholesale distribution software into your wholesale seafood business will help you improve productivity and customer satisfaction. From warehouse management to delivery management, technology will simplify your operations and business process flow.

    Here are some wholesale business software you should consider integrating with your business:

    1. Go eCommerce

    Taking your business digital is the next new thing. From having an eCommerce website to registering your business on various relevant wholesale directories, moving your business online comes with a lot of benefits.

    Going eCommerce makes it easy to employ distributor marketing and wholesale marketing strategies for your seafood distribution business. Using BlueCart’s eCommerce software will simplify your eCommerce operations. You can also take advantage of the B2B wholesale marketplace and online ordering platform.

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    Frequently Asked Questions About How to Become a Seafood Distributor

    Here are some questions about how to become a seafood distributor.

    What is the Top Selling Product in Seafood?

    The following are the top selling, high demand products in seafood:

    • Shrimp
    • Salmon
    • Tuna
    • Basa
    • COD
    • Catfish
    • Crab
    • Clams

    Is Demand for Seafood Increasing?

    Yes, it is. According to projections, the estimated US$116.8 billion worldwide seafood market is expected to increase at a CAGR of 2.9% from 2022 till 2026, when it is expected to reach a revised US$134 billion market size.

    Who is the Largest Exporter of Seafood?

    The EU are the largest exporters of seafood in the world. China and Norway follows closely.

    Ready to Get Started?

    With the right resource and tips, it is easier to start a seafood distribution business. Learning how to become a seafood distributor will prepare you for what’s ahead in the seafood and fish industry.

    Remember to integrate the right tools and software into your business. BlueCart offers an al-in-one eCommerce solution for wholesale businesses and can help you get the right footing.

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