June 18, 2019 Growing Your Business en_US Want to get your products onto the shelves of major retailers? Discover 10 tips direct from small businesses who are already selling wholesale to retailers. https://quickbooks.intuit.com/cas/dam/IMAGE/A75bvUAO9/71618192e0d6bf5eef36f8f3a0e5b468.jpg https://quickbooks.intuit.com/r/growing-your-business/wholesale-to-retailers How to wholesale to retailers: 10 tips from successful small businesses
Growing Your Business

How to wholesale to retailers: 10 tips from successful small businesses

By Cathie Ericson June 18, 2019

If you’re an artisan or maker, you might dream of hitting a home run with a large retailer or national big box store.

Creating something worth buying is every entrepreneur’s first challenge. After that, most turn to direct-to-consumer channels like e-commerce or a point of sale (POS) system to process orders in person.

However, to sell products to retailers puts your business in front of the vast audience of customers wholesale distributors already have at their disposal. This is where market research, knowledge of wholesale buyers, and the power of persuasion come into play.

With persistence, imagination, and the right strategy, you can make the dream a reality.

Here are 10 tips from successful small businesses on exactly how to sell wholesale to retailers …

1. Focus on your story

One of the best ways to get your product noticed is to have a compelling story surrounding it. And telling it often.

“If you can find a way to differentiate yourself from the competition, you have a key reason why someone would choose your product over other brands,” says Kelly Belknap, who with his wife founded Adventurist Backpack Co.

The minimalist backpacks are designed for travel and backed with a social cause. For every backpack purchased, the company provides 25 meals to families in partnership with the national non-profit Feeding America.

“We’ve had numerous retailers confirm that the reason they wanted to order from us is because of our story and mission to help feed American families.”

The same is true for green businesses and small businesses centered on sustainability.

2. Major on the mission

Story is also key to the success of niche women’s outdoor clothing company Kind Apparel. Especially how the brand weaves together its product and mission.

The line started as an Etsy shop and is now carried at specialty outdoor retailers, as well as online at Title Nine, a national retailer of women’s sporting and athletic apparel. Kind Apparel’s founder, Mallory Ottariano, notes that the Title Nine partnership came about primarily because of their shared mission to support women-led companies.

“My retailers sell to customers based on the emotional connection to a brand’s ethics so the way they market my story is important,” she says. “I give the retailers and their employees’ transparent information on how my products are made so employees can use my brand story to differentiate my line when speaking with customers.”

These tactics allow retailers to have a more direct-to-consumer feel to retail story-telling while complementing their own values.

3. Know the retail stores that fit

You stand a better chance of success by approaching a small retailer than going after Target or Walmart.

By striking up a personal relationship with the owner—especially if you happen to be a regular customer—you can learn about the store’s buying cycles, seasonal purchasing patterns, and customer preferences.

Research should also include a review of the store’s floor layout, how products are displayed, and the owner’s specific product categories.

Why? Because every inch of floor space matters in brick-and-mortar.

Showing a business owner what your product’s packaging looks like and demonstrating how conveniently it fits onto the shelves may be just what tilts the odds in your favor.

4. Pitch local …

While getting on the shelves of major retailers can often involve a trek to headquarters to meet with buyers, that’s not necessarily your best avenue.

“Forget corporate ‘process,’” says David Krysak, president of H4Legs pet products. “Most middle and regional managers can do discretionary buying for their local outlet. That allows you to learn their process, get face time, and figure out where others have succeeded and failed in their quest to expand nationally.”

It can also give you proof that your product is appealing when they are making decisions at a national level, as well as provide an internal fan who can help advocate for you.

Building a distribution network should be a long game—unless you have a truly disruptive product that retailers and distributors immediately see a need for within the market place.

“If not, having a low SKU count and limited market penetration typically does not yield the attention necessary to validate the margin requirements that accompany these traditional channels; at least not initially,” Krysak says.

5. Then, move to wider distribution

Starting with local retailers isn’t an end unto itself. Rather, use those direct relationships to find out how the larger processes work.

“Go early in the morning,” explains Krysak, “when they are less busy and ask questions to find out more about the process. For example, if the location is part of a franchise chain, who is responsible for purchasing and do they offer a local manufacturer program? Could you try stocking a few products to allow them to gauge interest from their clientele?”

Small retail footholds offer invaluable feedback when you eventually broaden to major retailers with wholesale distribution networks.

Another option for gaining retail shelf space is to work with a retail broker who can align your product message with the retailer’s operational expectations.

As Robert Cuddihy, CEO of natural beverage company True Citrus, explains: “Expect it to cost you, though. Not only will you pay broker’s commissions but also slotting and promotional costs.”

That’s because margins are tight in the retail category, so stores look at these less-established products as revenue generators for them.

6. Make your mark at trade shows

Trade shows can be your golden ticket. That’s because buyers are out in force at trade shows, always looking for what’s new and next.

However, it’s important to choose your shows carefully since they can be a large investment of both time and money.

You have to be fully invested to reap the benefits, notes Nichole Evans, a retail strategy expert and director of channel management for ChicExecs, a women’s accessory company.

“Your booth doesn’t have to be neon yellow, but you don’t just want to hang a sign or two because people will ignore it and just walk on by,” says Evans. She suggests you consider the same principles that designers use in window displays at department stores that are designed specifically to make people stop and look.

In fact, if you have the budget, hiring a professional booth production company can be a worthy investment.

7. Engage before, during, and after

Next, engage with every person who passes by your booth as a way to create a crowd so more people will stop to see what the buzz is about.

Evans finds it’s effective to give away promotional items—ideally one of your own products if it’s not too costly. Choosing a giveaway that requires a quick explanation will entice people to stop and engage, which again has the effect of making others stop too.

Equally important is looking successful.

“We always carried around a tablet to take an order,” Evans says. “That gives the appearance that we were always writing orders; the instinct of those who were walking by would be to stop and see what people were buying.”

Lastly, follow up on all the conversations you had within five days of returning home.

As you’re having personal conversations at shows, take the time to make notes so you can reference those details later. Touch base with everyone who left a business card or let you scan their badge.

8. Embrace the power of social media

While most people consider social media as a buzz-builder for consumers, Belknap found that it was helpful to catch the eye of wholesale buyers as well.

Adventurist Backpack Co.’s strategy was to build a following of outdoors and travel-related influencers on Instagram. Those influencers shared photos of the backpacks and wrote about the company in exchange for a free pack to take on their adventures.

“Within our first few weeks of posting on Instagram, we had a chain retailer from Montana with six locations reach out to us and place an order for 100 backpacks on the spot. Without ever having actually seen one in person.”

That led to the company to move from exclusively online to contacting smaller chains and individual boutiques across the country to get the products on shelves.

It has since expanded to college bookstores and—as part of their outreach—ended up talking with the accessories buyer for Urban Outfitters where it was fortunate enough to secure an order.

9. Keep it ‘short’ and send samples

As you deepen your relationship with larger retailers, most makers recommend a three-pronged strategy that includes emails, phone calls, and in-person visits.

“Once you’ve sent information to a buyer,” says Evans, “or further connected by sending them a news mention or influencer post, you can then follow up on the email with a phone call. You’ll probably get a lot warmer response than just a cold call.”

Similarly, Belknap also found that email was usually enough to get his foot in the door: “I would introduce myself and the company and our mission and explain why I thought it made sense for us to team up together.”

“Keeping things short and sweet is the best way to get your foot in the door.”

If you’re starting from scratch, check out the store’s website and initiate contact through email rather than dropping by unannounced. Hone your pitch to a few short, punchy sentences, explaining how your product can benefit the retailer’s customers and generate new revenue.

10. Always include a sell sheet

Most retailers will want time to consider your proposal. To help facilitate the process, leave behind a one- or two-page sell sheet: essentially, a brochure containing information related to the value of stocking their shelves with your product.

As a rule of thumb, sell sheets should include:

  • Wholesale price and retail price
  • Discount tiers: 100 units, 500 units, etc.
  • Product benefits and high-quality photographs
  • Testimonials from wholesale customers
  • Rating and reviews from direct customers
  • Patents and any other intellectual property rights
  • Ordering, website, and contact details

Take time to customize your sell sheet so it accurately reflects the buying needs of each retail store. Don’t go for a one-size-fits-all marketing approach. Again, sample products can also be hugely beneficial.

Never get discouraged going from wholesale to retailers

Even if you make all the right moves, remember that success is unlikely to happen overnight. “Don’t become discouraged if things don’t blast off from the start; the cliché of salespeople getting turned down by most retailers and buyers is real,” he says.

For every 100 stores you contact, you may get a response from a mere one or two. And that’s on a good day.

“Keep the dialogue open,” notes Belknap, “and try to overcome any objections there might be.”

With the law of averages in mind, contact as many different people and stores as possible. Keep following up—judiciously, of course—until they explicitly tell you that they aren’t interested. Slow and steady will win the race.