Tag Archives: Big-Box Stores

For Inventors, News

6 Outlets to Sell Your Product

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When you’ve succeed in manufacturing your invention and doing all the necessary research to make sure your product will be a hit, it’s time to find some distribution channels. Your goal is to find as many distribution channels as possible that fit your brand to let your customer interface with, learn more about, and (hopefully) buy your product. The idea is to constantly find new and prosperous channels to sell your product while avoiding channel conflicts that can undercut sales in existing channels. The most common roadmap inventors take is selling direct to consumers, moving up to small retail outlets before distributing through major retailers. This means you should prepare for your distribution channels to change over time as your product sees more success.

There are six common distribution outlets you might find works for your invention.

1. Direct Sales Methods

Direct sales is a way to get the product directly in front of the consumer through outlets such as mail ordering, Internet and telephone sales. Selling direct can even mean setting up your own brick-and-mortar location. Selling direct can seem more profitable because you’re cutting out the middleman but it can be a costly and time-consuming way to reach customers. There are only so many hours per day and, with direct sales methods, the amount of customers you can reach is finite. When selling direct, you have to be a constantly active participant in your company’s sales to get anywhere. However, selling direct is a great way to familiarize yourself with the marketplace your looking to reach with your product to discover the tactics that do and don’t work in your particular case. Direct sales can help you develop market traction and assess initial market response.

Part of your direct sales strategy can be direct mailing. Direct mail campaigns are a long-standing method of marketing that can encompass traditional postcards and newer digital methods such as emails. It can be expensive, paying for the paper and stamps, but can be very effective. But, it’s important to remember some people view direct mailers as “spam” and quickly toss them in the trash (real and digital), ignoring the product.

2. Big-Box Stores

Breaking into a big-box store can be difficult if you’re not prepared, but there’s no disputing the allure of getting your products onto the shelves of a mass retailer like Walmart, Staples, PetSmart and more. Landing distribution with a major retailer with stores across America (and possibly across the world) can put you on the map instantly.

But, it can be difficult to get there. You have to show your product is good and will generate sales. They’ll also be looking to see if you have the ability to satisfy their purchasing requirements. To get your foot in the door, it takes some research on each stores’ preferred method of contact. Some have a section on their site for prospective vendors to apply. Others invite all would-be sellers to email them with a proposal. And others have vendor events where they allow new vendors to come and apply in person.

Before submitting a proposal to a big-box store, make sure you have:

  • A Universal Product Code (UPC)
  • Product liability insurance
  • Names of other clients you’ve supplied orders to

3. Trade Shows

There’s a trade show for almost every industry. If you can think of it, there’s probably a trade show for it. If you have an industry-specific invention, you’re going to want to attend at least one trade show for it. They can be expensive, but they can also help generate leads and interest. There is the option to attend the show as an exhibitor or as a buyer. Some pros to attending a trade show as a buyer is the decreased cost and the ability to be more mobile instead of being locked into the booth space. You can meet new contacts and show off samples of your product. However, some trade shows don’t allow this practice as it can be unfair to exhibitors who have paid thousands, if not tens of thousands, of dollars for their booth spaces. It’s also a generally unwritten rule that buyers shouldn’t be soliciting manufacturers during a busy show. When it slows down, most are okay with the solicitation and will welcome the dialogue.

If your product is novel or you can showcase your product in a dramatic or eye-catching way, it may be beneficial to to exhibit at a booth. However, if your booth involves a bunch of pamphlets and reading materials, it may be best to go as a buyer.

4. Local Shops

Lately, there’s been a huge push to shop local and people are specifically asking for local recommendations. Small Business Saturday is even a day dedicated to shopping at local small businesses. When you’re pitching your product to local shops, it’s a different ball game than specialty retailers and big-box stores. Local shops with a location or two can’t compete with the chains on price. Their competitive advantage is quality and selection. Their goal is to sell what’s hard to find and more stylish than what you can find at Walmart or PetSmart.

You’ll also want to bring a sell sheet with you when you pitch your product. A sell sheet is a one-page brochure that you leave with the retailer that gives them a run-down of need-to-know information for when they stock your product. Your sell sheet should have:

  • Product images
  • What your product will look like on display
  • Ordering information
  • Customer testimonials
  • Partner testimonials
  • Your contact information

5. Web-based Markets

The Internet is a great place to sell– but it can be difficult to break into. Think of online stores like Etsy or Amazon. When you search for something simple like “wallet”, you’re likely to get hundreds of thousands of results. Customers can narrow down their selection further by colors, keywords, materials, shipping costs and times, price and more. But, what are the chances your product will make the cut?

Another option is to launch your own site and sell from there. Of course, there’s countless sites selling something similar to you and you’ll still have to compete with giants like Amazon and Etsy that are easy to find and navigate. Launching your own website and trying to get it to rise to the top if the search engines can be a time-consuming and costly task. It also presents a catch-22. It your product contains frequently used search terms, a lot of your competitors will also show up. And, if their sites rank higher than yours, they may take prospective customers. If your product is truly novel with different, out-of-the-box keywords, you’ll land higher on the listings so long as your customers know what search terms to use.

Paid Internet ads, like Google AdWords, can be helpful to break into the Internet market for a relatively inexpensive fee. But, if you’re not careful, these Internet ads can get expensive.

6. TV Shopping Channels

QVC and HSN are arguably the largest home shopping channels on TV and they’re great ways to boost product sales for inventions that don’t have the financial means to be displayed on mainstream television. In fact, airtime on QVC, the largest shopping channel, is free. Even with the lower costs, there are some risks to consider when placing your product on home shopping channels. Prior to airtime, you have to be able to deliver a large amount of product to their warehouse for quick order fulfillment. You also must be willing and able to transport all the unsold inventory back after your spot is over.

It’s also important to think of what demographic your product will appeal to. QVC’s main demographic is middle-aged women with an average age of 54. Most are very loyal, affluent and repeat customers. If your invention is something this group would love and find value in, QVC might be a great place to try selling. And, with airtime that goes on 24/7, they’re always looking for products to fill time.

Of course, home shopping channels won’t just take any product, they evaluate prospective products like any other retail store might. These channels are looking for quality and value. If you’re wanting to approach channels like QVC or HSN, ask yourself these questions first:

  • Is your product priced appropriately for channels like QVC or HSN?– These channels prefer items priced $15 and up. If your product is below that, it mostly likely won’t be considered a good fit.
  • Will your invention appeal to their viewers?– The demographics that watch home shopping channels are women with an average age of 54. As stereotyped as it sounds, products like jewelry, cosmetics and products that will solve household problems tend to do the best. QVC also does not accept feminine/personal hygiene products, firearms, fuel additives, products related to gambling, real fur, sexual aids and tobacco-related products.
  • Does your business have the funds to fulfill a purchase order even if you don’t sell out immediately?– You have to order enough product at the home shopping channel’s warehouse to fulfill quick orders while your product is on air.

Finding the right outlet is important. The goal is never to oversaturate the market… You want to build reliable retail partnerships to further your invention’s branding.

At Alotech, we partner with you to find creative ways to help you navigate the manufacturing world. Because we work with inventors with a range of products and needs, we have the resources and knowledge to help you be successful. Contact us today by calling 919-842-3599, or visit our contact page and fill out the form.

 

For Inventors, News

5 Tips for Selling to a Buyer

When you’re breaking into big box stores, you’re worried about getting your foot into the door and getting a meeting with a buyer. But what happens once you’ve written your proposal, generated some press about your product, caught the attention of a buyer and set up a meeting? What are the next steps?

New vendors are a major risk for buyers, so you’ll be fighting an inherent (though, not intentional) bias. A buyer’s career banks on how profitable their vendors make the store; so, they naturally worry about whether or not you can deliver the goods and deliver them on time. Sometimes, it’s easier for a buyer to keep buying from a vendor they have bought from the past. If they do choose your product, it’s because they believe that your product will sell better than what they’re already purchasing.

To convince a buyer that your product is the better option, there’s five things you should consider.

Don’t Forget They See A Lot of Products

In order to see everything they need to see in a day, the buyer may come off as brusque or like they’re rushing you. That’s fine, just remember they’re seeing a lot of products from a lot of people in one day. Continue your pitch as confidently as possible, don’t let it rattle you.

Some buyers may give you a time limit to present, so make sure you practice for a time limit. Organize your thoughts and prioritize your points. The most important points should come first, in case you go over your time limit. Focus on what makes your product unique, what you’ve learned in your market research and the reasons why the retailer should go with your product.

Offer More Than One Product (if Possible)

When a buyer takes on a new vendor, they have quite a bit of work to do. They have to fill out a whole bunch of paperwork and, some retailers, have very strict rules about dealing with single-product vendors. Even if you have a great product that the buyer thinks would sell, they may be less likely to say yes just because you’re only able to provide them with one option. Suppliers who can offer a whole line of great products are more likely to hear “yes”.

Prove Your Ship Time

While it can be a while before you get your first purchase order, retailers want you to be able to provide a fast turnaround time. It may take them a year to submit their first purchase order, but they’ll expect you to finish and ship their order in a matter of days or weeks.

Prove you have a history of shipping on time with a tight turnaround to really get the buyer to listen.

Show How Your Product Fits in the Current Line

Most retailers have a niche that they fill and want to purchase products that will also fill that niche. In your pitch, prove how your product fits within their line. This is a great time to use your market research.

Find the Right Price

Retailers want to make, on average between a 40 to 65 percent profit margin while still keeping the price at something that will keep their customer base happy. If possible, find what profit margin your prospective retailer aims for and make sure you can supply your product at the price they need to be profitable while being profitable yourself.

Big-box stores might not be right for you, so consider other outlets to sell your product.

At Alotech, we partner with you to find creative ways to help you navigate the manufacturing world. Because we work with inventors with a range of products and needs, we have the resources and knowledge to help you be successful. Contact us today by calling 919-842-3599, or visit our contact page and fill out the form.

For Inventors, News

Breaking into Big-Box Stores

breaking into big box stores alotech inc

For an inventor, getting your product on the shelves of a Walmart, Target, Best Buy and other mass merchants is an attractive idea. While selling in a big-box store isn’t necessarily the right route for everyone and every business, getting your product on their shelves can put you on a fast-track to commercialization and becoming a household name. For a small business or single inventor, breaking into the big-box stores and landing a large purchase order can catapult your brand into success.

It’s a lofty idea that few small businesses are able to do, but, once you do, you have to deal with a completely different set of issues.

Getting Your Foot in the Door

To start, before even approaching the mass retailers, you need to have a developed a solid base of smaller clients you are supplying your product to. Having a steady and consistent supply going to other clients can show that you have the ability to satisfy purchasing requirements.

For some retailers, getting a meeting with them is as simple as filling out their online vendor application. Both Walmart and Sam’s Club have a portal for current vendors and potential vendors that allow you to get a better idea of what they’re looking for, their minimum requirements a vendor must reach, standards for suppliers and the application. For other retailers, such as Home Depot or Target, they ask potential vendors to send them an email with your proposal. They may even have a vendor day where all the potential vendors can come show the functionality of their product and discuss their proposal in person.

Writing the Proposal

The proposal is an important part of landing a purchase order with any large retailer. The resources put out by Walmart can be used to help guide you in writing your proposal. When writing your proposal, you will need to include:

  • Universal Product Code (UPC) – The UPC is a barcode that contains a unique identifying number for your product; the UPC is to products as a social security number is to people. They were originally created to speed up the checkout process and control inventory. Now, virtually every product has a UPC code. The codes are issued by a private agency, the Uniform Code Council (UCC), and in order to obtain this code you will need to become a member and pay an annual fee. In addition to applying for a membership, you will need to provide your company’s current revenue, the number of products being identified with the UPC and the number of locations you will serve.
  • Product liability insurance – In the event a customer is injured using your product, you will need product liability insurance. Most major retailers require this to be in place before putting a product on their shelves to protect themselves once they assume the liability of carrying your product.
  • Other accounts – Supplying the name of other accounts you fulfill orders for can help establish your credibility. Big-box stores don’t want to invest time and money into your product and have your business go under. With the names of other accounts, they can see a proven track record and history of supplying your product on time. They also want to know that no more than a third of your total business will be coming from them. If you’re asked to supply the names of other major retailers you’ve supplied your product to, don’t lie if they would be your first. Instead, directly address their concerns about your ability to deliver your product on time by providing references and showing your track record with smaller retailers.

Increasing Your Chances

Big-box stores are a little skittish about taking chances on new products, single inventors and small businesses. Buyers at major retail locations see a new vendor as a risk because buyers are the one held accountable when a vendor can’t deliver. To increase your chances of being selected as a new vendor, there’s a few things you can do.

First, you can generate some discussion around your product. Generating PR through newspaper articles, TV appearances and online in blogs or chatrooms can help a buyer take notice of your product. Even advertising, as your budget allows, can help a buyer take notice.

Other ways to show buyers you are a lower risk is to expand your product line. This can be done through launching new products yourself or teaming up with other inventors to pitch all your products under one vendor application. Processing new vendors is a lot of work for major retailers, so it can be helpful to them when multiple products can come from one vendor rather than spread out across several.

Choose a major retailer that already has products that fit the niche you’re looking to sell to as buyers are looking for products that fit within their current line. You also will want to make sure you price your product right, buyers will want your pricing to be within their current range and not act as an outlier. Make sure you can supply them with the products at the price point they’re looking for while still allowing yourself to be profitable.

If big-box stores are not right for you, there are other outlets you may consider.

At Alotech, we partner with you to find creative ways to help you navigate the manufacturing world. Because we work with inventors with a range of products and needs, we have the resources and knowledge to help you be successful. Contact us today by calling 919-842-3599, or visit our contact page and fill out the form.