If you want massive numbers of customers to buy your product, your ultimate goal should be to get your product on the shelves of a major retail store. Youll run into a lot of competition should you decide to go this route, though. Of the products vendors pitch to major retailers, only 2% get picked up. So to be one of the lucky vendors, you need grit, determination, and the right approach to the process.
1. Most Attractive Retail Products
As a general rule of thumb, the hottest retail items feature high margins, fast turnover, and a small footprint. Retailers love products that meet these criteria easily. If your product doesn’t meet the criteria, consider how you can change it to hit these goal posts, or be ready to explain why your product is worth the extra time and space on the shelf in spite of tight margins. If a product encourages repeat sales, such as a shaving razor with refillable blades, it may merit more space on the shelf in spite of tight margins on the initial sale.
2. Essential Preparation
Before you pitch your product to any retailers, you want to be well-prepared. Identify your volume capabilities, have the timing mapped out, and ensure your product meets any relevant compliance requirements. In many cases, you have just one chance to get it right, and you want to be able to answer all the retailers questions about logistics. Depending on the market you are targeting, you may also want to have information about the environmental and ethical aspects of your manufacturing process and supply chain. Also be ready to talk about your company and its reputation. Some large retailers may want to see bank statements, business plans, and costing reports for extra assurance before making a deal.
3. Sales Pitch
Once you gather the details, devote some time to developing a sales pitch. Your pitch should focus on the merits of your product and the problem it solves for consumers, but you should also customize a unique pitch for each potential retail buyer. In particular, you want to explain to the buyer how your product complements or outperforms an existing product on the shelves. If the retailer isn’t carrying a similar product, focus on how your product appeals to those customers and works with the company’s merchandising plans. Have a prototype, sample, or demonstration with you. This is essential for engaging the buyer.
4. Small Start
To get practice before you start pitching to big retailers, consider starting with local or regional stores. It can be easier to make a sale to a smaller company, and that allows you to build up sales records before pitching to larger clients. After you’ve established a presence in several small chains or independent stores, pitch your product to a national retail chain.
5. The Right Contact
For your message to be successful, it needs to get in front of the right people. When you’re selling to an local or regional store, the owner or even the manager can often help with purchasing. As you start pitching to larger retailers, the acquisition chains typically get more complicated, and you need to develop a relationship with such retailers procurement people. Many large retailers have details about who vendors should contact to pitch products on their website. Some retail buyers only review pitches at certain times of the month, quarter, or year. When researching buyers, you want to make note of these types of details.
Rejections are just a part of the process. Steel your nerves so you are ready to hear no, and always keep moving forward. Review each experience and note where you can make improvements in your product, pitch, or both. Selling can be hard work, but itll be worth it when you land a lucrative nationwide deal.
7. Cash Flow
While pitching your product, you also have to keep your company running. Small contracts can help raise capital as you search for a large retailer, but you also need to ensure you’re ready for the financial reality of securing a large retail deal. Most large companies take 30 to 60 days to pay for orders. You want to make sure you can cover overhead and manufacturing costs in the meantime. To prepare, you may want to run several reports on projected expenses and cash flow. With the right retail relationship, your product could become a household name. Countless best-selling products started small. Think of Lays: The founder used to tote his potato chips from store to store in the trunk of his car. It’s happened before, and it can happen to you.