How LLCs Can Work With Retailers
If you’re a small business owner looking to get your product into retail stores or national chains, there are quite a few steps to take to prepare for the pitch. However, with focused research, knowledge of the industry, a great product and the ability to sell, you can achieve your dreams and see your products on shelves near and far.
To help you get started, we’ve developed a list of tips for trying to persuade retailers to carry your product.
Develop a Retail Pitch Plan
If you are looking to get your product into retail chains or go wholesale, you need to develop a pitch plan. Create a list of the stores you would like to approach and research whether your product aligns with their current merchandising plans. Understand their floor layouts, displays and product categories. Once you’ve conducted this research, contact buyers and distributors and share your pitch package. Which brings us to our next tip…
Create a Pitch Package
One way to get your foot in the door is by pitching your product in person. This approach (as opposed to email) will show the retailer your passion for the product and give a better idea of the working partnership. However, before you set foot in a retailer’s office, there are some specific terms you need to have prepared prior to your product pitch. Below are a few of the most common questions asked:
- Minimum opening order and reorder:Pre-determine your minimums based on the amount of product ordered or the dollar amounts. When you’re selling at wholesale cost, be sure to establish a minimum that covers the cost with volume.
- Turnaround time:From order placed to delivery, establish a timeframe in which a customer can expect your products.
- Payment terms:Will you invoice the store after the order arrives, or when it’s ready to ship? Make sure the terms you agree to will help cover production.
- Shipping and insurance:Decide how you want to charge for shipping and which carrier you want to use. Establish an agreement with the store on how to handle damage/loss after a package has been shipped. You could offer insurance as an add-on for an additional fee, for example.
- Exchanges and returns policy:Determine how you will handle instances where a customer may be unsatisfied with the product, or if the product breaks. For example, you could set a window within which an exchange and return can happen.
On top of including these terms, you would also want to include information about your product as well as product and packaging samples.
Spruce up Your Packaging
Maybe your products have only been sold online, where you can include multiple images and descriptions that make it easier for the customer to know everything there is to know about the product. However, in a retail setting, your product has to stand out from the competition. Your packaging has to make an impact on shelves in order for a retailer to be interested. Does it currently communicate its features and benefits? Is it even made to physically sit on shelves and be visible? Knowing this, you may look at your packaging a bit differently.
Optimize Your Website
Let people know you do wholesale by including a specific page on your website to show that offering. The page should have a contact form for stores to complete with details about themselves. Consider including a line sheet (with a company overview, terms, order instructions and product catalog) if you think that would be a food fit.
Attend Trade Shows
Trade shows are still one of the best ways to connect with buyers and should be a part of your plan when you’re looking to integrate retail into your distribution strategy. It’s important to know what shows are the best for your brand. Being able to identify those shows for your business depends on how much knowledge you have around the industry you’re in. Attending trade shows as an exhibitor isn’t free, so plan ahead to ensure you have the financial support to make the right impact.
Cultivate Your Own Customer Base
It might be easier to convince a retailer your product is successful once you have proven sales. Showing pre-existing orders and revenue will prove that there is already a demand for your product. To raise awareness and interest in your product quickly, you could start a crowdfunding campaign.
As with anything, there are some advantages and disadvantages to going wholesale. In general, it offers quicker movement of your product, more cash flow through larger orders, larger consumer reach and greater brand exposure. However, it could cut your margins in half, plus you will spend time managing and communicating with stores and have less control over your branding.
We hope these tips help you get started building your case for future retail success. In the meantime, Incfile has many other resources to help you take your business to the next level — or even start it from scratch. Reach out to our experts today to learn about how we can help with all the ins and outs of managing your company.
Chris Keller is a veteran the in business finance industry. Prior to starting his own business, he managed product lines at two Fortune 500 companies focusing on their Profit & Loss statements.