Trying to get your product into large retailers like Wal-Mart, Best Buy, or Home Depot? Many thousands of businesses every year dream of getting their products into retailers like these. However, only a handful of vendors will make the cut. Why do some companies make it on the retailer’s shelves while many others don’t?
To answer this question, here are some reasons why a particular company might have been rejected by the retailer:
- The company or the products didn’t have a track record of sales (Buyers hate being a guinea pig for an untested product)
- The company did a poor job with their sales presentation to the buyer (Buyers can’t stand when a vendor did not prepare and wastes the time of the buyer)
- The product’s packaging was ineffective in communicating what the product offered to the consumer (The product’s packaging is your “best sales-person”. Not having a professional design your packaging guarantees failure before the product can get on a retailer’s shelf)
- The retailer’s cost or the suggested retail pricing was not correct (Companies either over-estimate or under-estimate on how much a retailer will pay for their product as well as what the end-consumer will pay for their product)
While there are more reasons why the company got rejected by a large retailer, these four are the most common. If your end-goal is to sell to Wal-Mart, Best Buy, Home Depot or any other large retailer, these steps below can help you get your “foot in the door” with the retail buyer.
- Are you ready for retail? Before you knock on the door of Wal-Mart, you need to ask yourself, “Am I ready yet to sell to retail, especially a large multi-billion dollar retailer?” Many clients that we work with are not ready yet to contact a retail buyer. From determining payment terms to how the product will ship to the retailer’s warehouses, many companies don’t have all the basic questions that a retail buyer will asked them figured out. Planning ahead and doing your homework on what questions a retail buyer may ask will put you ahead of the other companies vying for that spot on the retailer’s shelf.
- Determine the correct cost/pricing strategy. Before you approach Best Buy, you need to make sure you have factored all the costs (i.e. manufacturing, packaging, marketing, distribution, sales commissions, etc…) of the product. We seen companies trying to sell Best Buy and come to realize that they are not making any money. Why be in business if you can’t make a profit? The larger the retailer, expect less profit to make off them. However, because of the potential sales volume from Best Buy, it’s a wash. With smaller retailers, you can charge a higher cost to off-set your smaller profits from large retailers like Best Buy.
- Making contact with the retail buyer. As a former retail buyer, I would get hundreds of phone calls or emails from prospective suppliers. Many of them did a very bad job in trying to land a sales appointment with me. If you want to get a retail buyer at Home Depot interested in your product and offer you an appointment to meet with him or her, here are some tips:
- Exhibit at industry trade shows. If you were selling Apple iPad accessories, as a retail buyer, I would expect to see you exhibit at the Consumer Electronics Show in Las Vegas in early January. While these shows cost money, you have a great chance in setting up appointments with retail buyers.
- Get mentioned in trade publications. Retail buyers subscribe to various magazines in his/her trade. Try to get featured in one of those trade publications. A favorable article on your company’s product may catch the retail buyer’s eye.
- If you are “one-item” vendor, you may have better luck selling into Home Depot by selling to a distributor. A distributor sells many different vendors’ products into a retailer such as Home Depot. By using a distributor, Home Depot has fewer vendors to manage on a day to day basis
- Hire a manufacturer rep. If your sales skills are not sharp enough to go against some of the toughest buyers in the world, you may be better off in hiring a manufacturer rep. A manufacturer rep works on commission and may already have a relationship with the retail buyer at Home Depot. However, they are not employees of your company and you cannot tell what to do.
- If you can’t hire a manufacturer rep, try to get a recommendation or referral from a supplier already doing business with Home Depot. Cold calling retail buyers can be stressful. However, when you call the retail buyer and mention that another supplier that you both mutually know told you to call the retail buyer, you probably will get a few more minutes to get the retail buyer’s attention.
- AFT “Always Follow-Thru”. You can’t believe how many vendor meetings I have sat through where action items that the vendor promised to follow-through on but never did. Do you know what happened? I didn’t buy from those particular companies. If they can’t deliver on their promises, how do I know they will be by my side when I really need them? Always follow-through on your promises made to the retail buyer
If you’re looking to sell to Wal-Mart, Best Buy, Home Depot or any other retailer, remember to take your time and do your homework. Rushing to sell a large retailer will cost you time, effort, and of course money down the road!
To learn more how to sell to large and small retailers, visit https://retailbound.com.