Retail buyers get approached and pitched hundreds of times a day by product manufacturers. Retail can transform a brand from low profitability and a local following to a rocket ship of growth with national expansion. Preparing and approaching retail buyers is crucial if a CPG company wants to get into this channel.
Below are 5 steps for how companies can get into retail. Using our 5 steps, product manufacturers can confidently approach and secure partnerships with retailers to accelerate their brand’s growth.
Step 1: Historical Sales
A retail buyer’s #1 goal is to select brands that will increase their company’s sales and grow profitability. A quantifiable track record of success can grab a buyer’s attention almost immediately. You will want to outline your existing distribution channels whether that’s online or in local stores with historical sales data to support it.
Step 2: Marketing Strategy
The second crucial element you will want to present involves your current marketing strategy and how you have currently obtained sales or plan to.
Next, defining a target market and customer segmentation plays a pivotal role by informing how you can differentiate your product from other product manufacturers in the marketplace.
Unearth your unique selling proposition (USP) and communicate how your product offers value to customers in ways that competitors don’t. Your marketing and advertising strategy should communicate this USP effectively across various channels suitable for your audience.
Lastly, outline how you plan to compete in your chosen market. In an environment often saturated with similar products, your brand needs to stand out.
Step 3: Financials
The third strategy to secure is your financial plan. Expanding into retail requires significant investment. From product manufacturing to marketing campaigns, you must have a clear picture of the resources required to support existing marketing channels and how to get more traffic into the retailer’s store.
To assure potential retailers of your financial sustainability, you will want to show historical and forecasted financial projections. These can demonstrate your capacity to meet the financial demands of retail expansion. Additionally, your current payment terms or case conversion cycle is important to show that your brand can support the investment in inventory as sales grow.
Consider also the possibility of securing additional funding. This could involve appealing to investors or securing loans, depending on your financial status and requirements. Even having a promissory letter from an investor indicating they will back if a retail partnership is struck.
Step 4: Pricing & Promotion Strategy
The fourth strategy is honing your pricing and promotion strategies. Show how your pricing will attract customers, but also ensure profitability. Consider retailer margins, competitor pricing, and customer price expectations when determining your pricing strategy.
Promotional campaigns play a critical role in driving consumer awareness and sales. Plan these with precision, ensuring they align with your brand and appeal to your target market.
Step 5: Supply Chain Strategy
The fifth and final strategy to secure is a supply chain strategy for your brand. Retail success requires efficient sourcing, production, inventory management, and delivery processes. Evaluate and optimize these aspects to meet the demands of retail distribution. Retail buyers will look for a coherent and confident story on how they can assure that product will stay on the shelf and deliver in full. No inventory on their shelves? No sales for them or for you.
Establish relationships with reliable logistics providers with retail fulfillment capabilities for product manufacturers, ensuring you can deliver products promptly and in perfect condition. An efficient supply chain is key to maintaining consistency and quality, both critical to your reputation and retail partnerships.
Embarking on a retail journey requires more than a great product. It demands a holistic approach encompassing a robust understanding of historical sales, a data-driven marketing strategy, sound financial planning, effective pricing and promotional strategies, and an efficient supply chain.
By securing these five essential strategies before pitching to retailers, you can present a compelling case for your brand and product, paving the way for a successful retail partnership. So, put on your strategist hat, and get ready to turn your retail dreams into reality.
This guest blog post was provided by Stephen Schlecht at Outbound Fulfillment, an e-Commerce & Retail Logistics 3PL. Looking to upgrade your 3PL warehousing and fulfillment? Contact the team at Outbound Fulfillment today to get more information.