Did You Attend Yohan’s Webinar on Selling to Large Retailers?

Congrats to all of you that attended Yohan Jacob’s webinar on Selling to Large Retailers.

Personally, I took over four pages of notes (and I am usually not a note taker).  The information he talked about was timely, informative, and right on the money!

But, if you did miss it, I have good news.  No, there won’t be a replay, but Yohan has given me permission to share some recaps from the webinar.

Did You Attend Yohan's Webinar on Selling to Large Retailers?Here is a recap of some of my favorite tips from his webinar:

  1. The four most common mistakes when selling to large retailers (or any retailer!) is:
    • Lack of preparation (now, where did I put that line sheet?)
    • Over promise, under deliver (always do just the opposite!)
    • Lying (Of course, we can get that out tomorrow …. not!)
    • Poor follow-through (but I just talked to you yesterday …)
  2. Before meeting with a retailer buyer …
    • Have samples or at least a good image of your product
    • Have your packaging finalized
    • Know your unique benefits and selling points
    • Know your competitive advantages
    • Advertising and promotions are developed (and in the works)
    • Pricing and any back-end products are developed and ready
    • Know your sales stats and history, including returns/defective product stats
    • Know your retailer’s buying patterns and background
    • Check your retailer’s ability to pay invoices on time
  3. Best ways to reach retailers:
    • Call (best way)
    • Email (second best way)
    • Drop by — not always effective
  4. Never ship unsolicited sample
  5. Best way to make a 60 second phone pitch:
    • Introduce yourself and your company
    • Give a brief overview of your company
    • Ask if this is a good time to talk (very important … remember buyers are busy people!)
    • Discuss the reason for the call
    • Set up a appointment, when necessary
  6. Selling to retailers’ summary
    • Make buyers job easy — in any and every way you can
    • Follow-through on any and all promises (shows reliability)
    • Treat buyers like you want to be treated!

Since Yohan shared so many more great tips that I did not share above, he gave me permission to share his webinar slides with everyone!  Originally, he planned to email them just to the folks who attended his webinar, but after we talked, he agreed to let me share them with all my subscribers:

Yohan Jacob’s, Selling to Large Retailers, Web Slides

AND … Yohan also agreed to share his special membership group discount offered during the webinar:

Receive 50% off your first month when you subscribe to his membership group:

The Retailbound Academy

Just click on the link above and, when prompted, fill in the coupon code: 25SAVE

NOTE:  There is a detailed method to sign up for his academy.  Check out the sign up instructions for extra help.

 

Sell to Big Box Stores AND Independent Stores?

Last post we talked about Selling through Independent Retailers.  Working with smaller retailers is the best place to start wholesaling your products for many different reasons listed in the article.

When I was an active road rep, I worked exclusively with small and/or independent retailers.  The orders were, of course, smaller than big box stores, but I found independent shops to be open to talking with me on the spot, eager to see my products, and easier to work with.

I also discovered that working with smaller shops, I could not also market to larger retailers.  Why?  Because once a product is seen in a large chain or big box store (Walmart, Costco and such), the smaller retailers would drop the line.

Customers value smaller retailers because they feature the newest or most Sell to Big Box Stores AND Independent Stores? unique products.  If you are new in the wholesale arena, this is a perfect opportunity for you.

On the other hand, large big box stores are looking for a proven product.  They don’t necessarily want some unique or unproven item.  Since they sell more volume, their prices or often lower than smaller retailers, and their orders to the producer will be larger.

If you are particularly interested in working with both markets, let me give you some tips:

  1. Create two lines:  One unique line for the independent retailers and one proven line for the big box stores.
  2. Make sure you have plenty of product on hand (or you can create it quickly) when you approach chain store buyers.
  3. Be prepared for large cash outlays for these large orders and the financial means to wait 90-180 days before receiving payment.
  4. Do not be surprised if you are required to meet with numerous people and buyers over a long period of time and sign a load of confusing paperwork before you get your first order.
  5. Expect to (possibly) be required to pay a stocking or shelving fee to get your products into a big box outlet.
  6. Also, expect the larger stores to ask for a discounted wholesale price.
  7. Last, but not least, be prepared to pay for damaged goods (even if the store damaged them), to have items returned to you, or even have the complete order canceled at the last minute.

Of course, there are exceptions to all the above.  The list is based on some of the (horror) stories I have heard from new producers when selling to big box stores.

My best advice:  NEVER put all your eggs in one basket (okay, a good Easter pun!).  Should you decide to grow your business to include big box stores, make sure to do your homework first.  And don’t forget the independent stores that made your business what it is!

Selling to Large Retailers, Part Two

Last week, we featured two posts by the Arts Business Institute on Selling to Large Retailers.

Today, I would like to share Part Three and Four of the Arts Business Institute’s series on the subject.

What do you need to know to be prepared to take orders from large chains?

  1. You will need to scale up your production.
  2. You will need sufficient materials.
  3. You may need studio assistance.
  4. You will need to control your costs.
  5. You will need to manage your time effectively.

Production Process 1

Planning, planning, planning …. receiving a large order from a large retail may seem like a dream come true, but do you have systems in place to address the points above?  If not, you may find yourself in a panicky situation with your business and the pending order you are not prepared to fill.

Flexibility is important as your whole business may need to change overnight!  Part Four of the Arts Business Institute series helps you prepare for the steps above:

Take these factors into account when you start planning to go big:

  1. Consider all your accounts. Will selling to major retailers cause problems with your other wholesale accounts?
  2. Brand perception (Is this store your ‘ideal’ account?)
  3. Stay diversified.  Don’t put all your eggs in one basket. Will your chain store accounts last forever?
  4. Plan your business for the lifestyle you want … If scaling up production and selling to chains creates too much stress or requires you to work many more hours than is reasonable, it ultimately won’t be worth it.

In my years as a sales rep and consignment store manager for a wood craft co-op, I saw many folks fall victim to the large store orders when they were not ready for them.

  • One producer lost his small wholesale account while catering to one large retailer.  Once the deal was over, he nearly went out of business!
  • Several small businesses took on the large orders only to extend their credit so far that they could not recuperate!
  • One large store cancelled the order right before delivery leaving the small business with more inventory than they could unload in a reasonable amount of time.
  • Still another business folded because they could not sustain themselves for the 180 days it took to receive payment from the retailer.

On the other hand, writing an order with a large retailer can be the next step of growth for your business.  Make sure you are prepared before ‘signing on the dotted line’!

 

 

 

Selling to Large Retailers

Selling to Large Retailers is a completely different sales model than selling to gift shops or smaller mom and pop stores.  Although I don’t suggest you start out your wholesale efforts directed at selling to large retailers, this is a lucrative market to consider when you are ready.

While I (or you) can walk out of a small smaller retail shop with an order, this is not the case with larger retailer who often have regional buyers in the corporate office across the state or the country.  Often, there are several layers of corporate folks before you reach the appropriate buyers.  And you may end up working with the buyers assistant rather than the buyer themselves.

The Arts Business Institute recently published a two-part article on the subject.  Here are some of their tips:

How to Sell to Major Retailers, Part 1

How to reach them

Photo courtesy of the Buyers Market of America

Photo courtesy of the Buyers Market of America

Trade shows. Buyers for major retailers often attend trade shows to see new products and connect with their regular suppliers….

Direct contact. Identify chain stores that you feel would mesh well with your brand and your collection, and find out names of buyers you can reach out to….

Pursue trunk show opportunities. Occasionally, department stores and other chains will invite artists and other entrepreneurs to apply to participate in trunk shows….

Use sales reps. Reps make it their business to land store accounts….

In part two of this excellent article, The Arts Business Institute explains some of the expectations of dealing with larger retail outlets:

How to Sell to Major Retailers, Part 2

TAKING THE ORDER…Be honest with the buyer about your production capabilities. Don’t overpromise, and put yourself in the position of scrambling like mad to fill a huge order that just doesn’t make sense for your business…

THE PURCHASE ORDER…When buyers for national chains place an order with you, they will create a Purchase Order, with details and with a reference number. This P.O. number is crucial – if you don’t have a Purchase Order, you don’t have an order…

TERMS…Chains don’t always demand discounts on their orders, but often do request price breaks due to volume….

…You may put a chain store on a Net 30 basis (which they will probably require) but in today’s world it’s not uncommon that these retailers take longer to pay. Be prepared for this.

It is also very common for chains to return items to vendors (this is across the board, it’s not just you!)…

The best advice in working with large retail outlets is to DO YOUR HOMEWORK before you approach the store personnel.  I have seen too many producers hurt their business or even go bankrupt over poor planning when dealing with large retailers.

Selling to Chain Stores and Large Retailers

Carolyn Edlund, author of the Artsy Shark blog and website, is writing an informative series of articles on Selling to Chain Stores and Large Retailers.  Excerpt from part one:

How to Survive and Thrive Without Losing Your Shirt – Part 1

I received a phone call a while back from a gentleman who wanted a consultation about developing his greeting card line and launching it into the marketplace. At one point he mentioned, “I’d like to sell to Walmart.”

This was a bit of a leap for a newbie, but since there is a lot to know about dealing with national retailers and chain stores, I’d like to take some of the mystery out of it. While I’m not recommending that you approach Walmart, I’d like to address the process of selling to large retailers, and how you may be able to do that to grow your business.

Having been approached by producers SAYING THE SAME THING, makes me realize how important this Selling to Large Retailersinformation is for product based business!  Although selling to Wal-Mart (or any other large chain store) is a lofty goal for a newbie, it is not impossible to reach if you follow some important strategic plans to get you there!

Carolyn summaries the steps as followings:

First, get ready. Before you even start thinking about soliciting large retailers, you need to have a solid product line that is priced profitably at wholesale.

Simply put, you need to be in business for awhile with a proven product line that has sold well in the marketplace.  It is nearly impossible to jump from craft show sales to selling to big box stores without selling to smaller stores first – the step in the middle!

What about your existing business?  If you have existing wholesale accounts, it probably won’t surprise you that they might not be pleased to hear that your work is selling to large chain stores.

I can assure you that your smaller stores will not be happy to see your products in big box stores!  As a sales rep, I have lost several accounts because the buyers saw the line they brought into their store – thinking it was new and unique – selling in the large retailer in town.  This move can be the kiss of death for your smaller stores; so be aware!

Corporate Buyers.  Chain buyers also meet with sales reps who give them presentations on different product lines

National reps (vs. territorial rep, which is the type of rep that I have been) is one of the route to pursue to get the attention of Corporate buyers.  These are the reps that have the relationship (which is half the problem solved!) with the buyers who purchase items for large chain stores.

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Personally, I have seen and heard horror stories about smaller producers going out-of-business because of selling to big box stores without doing their homework first.

I highly recommend reading Carolyn’s articles:

How to Survive and Thrive Without Losing Your Shirt – Part 1

How Chains Work and How You Can Work with Them – Part 2