small business bc-retail distribution-oct2010
DESCRIPTION
Seminar to help importers and suppliers move their product line to retail market.TRANSCRIPT
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Retail Distribution
move your product line to market
Small Business BCGerry Spitzner
Contact info at: www.retailsos.telWebsite: www.retailsos.ca
retailSOS.ca 1Gerry Spitzner
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Roadmap
• Thoughtstarters• Purchasing methods• Distribution• Product• Preparation• Insights
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Objectives
• How to approach retailers• Why and how they buy• Retail distribution channels• What buyers look for in a
supplier• What buyers look for in a
product• Your sales & marketing plan
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Acronyms
• POS= point of sale• POP= point of purchase•WMS= warehouse mgmt system• SKU= stock keeping unit• MOM= minimum order multiple retailSOS.ca 4Gerry Spitzner
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Acronyms
• CPG= consumer package good• IND= independent retailer• UPC= universal product code• PO= purchase order• GMROI= gross margin return on investment
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Thought starters
• Product, price, place & position;• Consider promotion and productivity• “Profit-unities” — how is this product going to generate incremental profit for me?
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Thought starters
•What’s the difference between your customers and your consumers?
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Thought starters
• How to sell or why retailers buy; which do you prefer to learn?
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Thought starters
• Ever had buyers remorse?
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Important insight #1
• Show me the value; or I’ll show you the door.
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How to approach retailers
• Make your presentation in terms of the customer.
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How to approach retailers
• How they benefit, how they profit, and how they produce will provide value.
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How to approach retailers
• Decide first if you want to approach IND’s or chain retailers.
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Things that annoy retailers
• Unsolicited faxes and emails• Damaged product & mis-picks• Invoice doesn’t match quoted price on purchase order• Poor paperwork
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Things that annoy retailers
• Cold calls•Weak approaches• Suppliers that disappear after the sale
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Why they buy
• Profit; to make money
•Want to find something (new) that turns over at a price that will make them money retailSOS.ca 16Gerry Spitzner
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Why they buy
• How can I keep customers in the store longer?
• Look at products through the eyes of consumers
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What keeps retailers up at night
• Top line sales and cash flow• Customer traffic• Customer profitability• Staff productivity• Return on investment; ROI
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What keeps retailers up at night
• Do we really need that?
• Inventory management is the main focus
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What keeps retailers up at night
• Inventory is the retail gamble
• “Stack it high and watch it fly” has turned to “stack it low, so its sure to go” retailSOS.ca 20Gerry Spitzner
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Retail distribution channels
•Wholesalers
• DSD; Direct Store Delivery
• Chain; Self Distributors
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Retail distribution channels
• Department stores• Mass & Big Box• Specialty and Discount• Catalogue and Internet
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Retail distribution channels
• Grocery and drug stores• Chain and banner stores• Convenience stores• Independent stores
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In the distribution channel
• Is the product WMS friendly?• Case and product upc• Dealing with concealed damages• Case pack retailSOS.ca 24Gerry Spitzner
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What buyers look for in suppliers
•What your biz background is• Financial means• Number of years in business• Geographical limitationsretailSOS.ca 25Gerry Spitzner
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What buyers look for in suppliers
• Trend watching; help me with what’s hot.
• Tell me about something new or up and coming before telling anyone else.
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What buyers look for in suppliers
•Where else are you selling this product?
• I need to know why your product will be wanted by my customers.
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What buyers look for in suppliers
• You need to know my customers.
• I do.
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What buyers look for in suppliers
• I need to know how you are going to educate the customer about your product and get them to try it in my store.
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What buyers look for in suppliers
• Can you replenish quickly; do you have a solid supply chain?
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Retail reps
• Consider using a professional agent, broker or wholesaler
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What sellers ought to do
• Shop the store ahead of time• Understand the strategic positioning of the store• Edit your assortments
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What sellers ought to do
• Objections & roadblocks• Understand customers situation• Help me make money!
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What buyers look for in a product
• Is there a need or a market?
• Or both?
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What buyers look for in a product
• Push or pull product?• Is your product future proof?•What is the life cycle of product?
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What buyers look for in a product
• Taste, health, ingredients, appearance, sustainability, preparation, packaging and customer value
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What buyers look for in a product
• Look for items that are different; not the same; uniqueness
• Must be easily understood by store staff and consumers
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What buyers look for in a product
• Add interest and excitement to their stores with new products
•What retail price can I get for this product?
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What buyers look for in a product
• Some look at product first; then see if they can carry the price
• Others look at cost first; so they are judging the selling price and then a product to fit or match
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Pricing for retail
• Do not compromise on your price• Know your competition • Know your taxes•Wholesaler upcharges • Brokers fees
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Pricing for retail
• Retail margins and retail pricing• Mark up and “mark on”• Gross margin percent; GP%• Gross margin dollars; GM$retailSOS.ca 41Gerry Spitzner
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How to deal with merchandising
• Tamper proof packaging• UPC code that stays on package• Display racks and trays• Display packages with a window retailSOS.ca 42Gerry Spitzner
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How to deal with merchandising
• Plan-o-grams & compliance• Must fit on a shelf in the section or category it is merchandised in• Package size/dimensions• Photos
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Be Prepared to:
• Endure long receivable cycle• Provide dating• Provide cash discount• Payment by credit card• Even risk not being paid
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Be Prepared to:
• Provide a listing allowance• Prepaid freight; delivery to the retailers door• Clear up damages and returns• Have a plan for recall• Sign a vendor agreementretailSOS.ca 45Gerry Spitzner
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Market research
• Seek Out Hidden Opportunities• Look Under Your Own Feet• Continually Scan the Radar of Opportunity• Find Something You Like and Believe InretailSOS.ca 46Gerry Spitzner
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Market research
• Research what’s working• Go to where retailers are• The timing of your sale
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Consider
• Use a wholesaler that specializes in your type of product• Referrals are the way to go• Value in a short term incentive retailSOS.ca 48Gerry Spitzner
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Consider
• Becoming the retailer & go online• Subscribe to newsletters• The use of business social media• Emerging cell phone apps for retail called “mobile retailing”
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Stumbling blocks
• Almost all national chain retailers have their own import department
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Stumbling blocks
• At the moment all retailers are focused on SKU rationalization and inventory management
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Stepping Stones
• Large retailers look for unique products; they like to act like small retailers• IND retailers look for unique products to differentiate and can act quicker than chain
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Stepping Stones
• Hunters and gatherers; find the hunters
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Stepping Stones
• How can you?...• Help them make money• Save them time• Make them feel safe• Make them feel special
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Important insight #2
• Confidence is the #1 factor in determining what and where retailers buy...• quality is #2, service is #3• selection is #4 • and price is #5
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The Opportunity
• Retailers look for products to differentiate their mix, add ‘excitement’ to their stores and make money.• They don’t have time to find them; this is your opportunity!
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What Now?
• Start a sales & marketing plan
• Understand your target market and it’s buying motivators. Who, where and why?
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What Now?
• Determine your target and method of distribution. How much will it cost you?• Define your unique value proposition & keep it current.•What’s in it for me? (WIIFM)
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Thanks!• Your evaluation is appreciated• On LinkedIn? Me too... connect with me• On Twitter? Me too... Follow meGerry Spitzner retailSOS.ca 59
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Thanks!•Want a copy of this presentation with my speakers notes?
• E-mail me; [email protected]• Contact info; www.retailsos.tel
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Resource Links• For bar code info; www.gs1ca.org• For mfr agents info:
http://www.cylex.ca/vancouver/manufacturers%20agents%20representatives.html
• For mfr agents; Google key words; manufacturers agents Vancouver bc, or food brokers Vancouver bc
• For wholesalers; Google key words; wholesale (your product category ie clothing) Vancouver bc
• Retail association: www.shelfspace.ca
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Learning Links• Sales questions: www.gitomer.com• Sales and personal development: www.briantracy.com• Retail expertise: go to You Tube; search for - Paco
Underhill• Retail, sales & marketing and small business:
www.donaldcooper.com• Retail, sales & marketing and small business:
www.retailwire.com• Sales & Marketing: www.raintoday.com• Trends: www.trendhunter.com• Trends: www.springwise.com• Trends and personal development: www.ted.com• Pricing and margin definition:
http://en.wikipedia.org/wiki/Gross_marginGerry Spitzner retailSOS.ca 62
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Books• Little Red Book of Selling; by Jeffrey
Gitomer• The Sales Bible; by Jeffrey Gitomer• Why We Buy; by Paco Underhill• Unmarketing: by Scott Stratten• www.unmarketing.com• Crush It!: by Gary Vaynerchuk• www.garyvaynerchuk.com
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