08 Aug 2013
- Written by Carlee McCullough
ON OUR WAY TO WEALTHY Over the years I have come across some pretty unique products invented by folks eager to earn a profit from their product development of prototypes, samples and/or creations. From cookies to generators and sauce to hair products, the ideas are plentiful. But it takes a team and a plan to truly succeed on a large scale.
Now there is a difference between having your product placed in a few "mom and pop" stores and having them in Wal-Mart stores across the country. Let's discuss what it takes to bring your product to "retail ready."
Have a plan
An organized plan makes the process much easier to accomplish. The plan is the map to introduce the product and/or brand to retail. Decide early on if the plan is to "go small" or "go big" box retail. But either way, a plan is needed. Consider starting small, which may include flea markets, farmer's markets and smaller retail stores. Once you have a track record and a sales record, larger stores may gain interest.
Know the stores
Is your product high end or bargain? This will determine which stores to target. Identify the stores that you believe would carry your product. Research everything you can possibly find about the stores. Many stores will have the process of adding products to their inventory online, which may include contact information for buyers. If you do not find anything on the web, simply email them for information.
Know your product
Prior to convincing a retail store to carry your product, it is imperative that you clearly know the features and benefits of your product, what makes it different from what they currently carry, and why the retailer should carry it over their current product. It is only natural to believe that your product is the best since you have invested time and money into it. But you must be able to articulate what makes your product better and different, size, price or otherwise.
Know the competition
To position your product against the competition, you must know the competition very well. Know their contents, packaging, pricing and how much shelf space they have in the stores. But most of all, know how you compare to the competition.
Pricing is important in the retail world. The wholesale price is typically double your cost and the retail price is typically double the wholesale cost. So as an example: your cost is $1, wholesale is $2, and retail would be $4. Make sure your website offers a shopping cart so that purchases can easily be made.
Branding the product
Unless this is the first and last product you will introduce to retail, you want to build a brand and accompanying brand loyalty. The loyal customer typically connects with the brand rather than the product. From product inception, the goal is to build customer loyalty by having a story that touches the customer in some way. Remember, long-term success at retail is based on brand extension, which includes bringing more products to retail such as additional flavors or sizes of the primary product.
A label that looks like it was designed by your 8 year old will never work at retail. A handmade label will not work unless it is professionally designed to appear "homemade." Retailers have an image of professionalism to project to its customers and clientele. Your packaging must make the retailer look good. The packaging must be sturdy enough to protect the contents but appealing enough to attract a buyer.
Product on the shelf when no one knows it is there is a recipe for disaster. Promotional products such as samples, posters and point-of-purchase displays go a long way to create customer awareness.
Most retailers want to see and touch the product prior to purchasing it for their shelves. The availability of product samples is much needed. The retailers will be observing the packaging, labeling and contents.
If your product has received great press, publicity or promotion, include it in your package. Good publicity makes selling the product easier for the retailer. The articles may answer additional questions the store representative may have.
Hire an ISR
For efficiency, consider hiring the help of an independent sales representative. The ISR typically already has a relationship with the stores and can help get your foot in the door. They are usually paid a commission of 10-15 percent of sales. This saves you in that you do not have to pay up front and the ISR is not on payroll. Their participation as a team member now frees you up to focus more on the business.
Now that the store has made an order, the product should be ready for delivery. The retailer should not have to wait months to receive the product while your production catches up with orders. Time is of the essence.