small business bc-retail distribution-09oct2012

Small Business BC Gerry Spitzner | retailSOS.ca

Find me: www.retailSOS.tel

October 9, 2012

Thoughtstarters

Purchasing methods

Distribution

Product

Preparation

retailSOS.ca | Gerry Spitzner 2

Insights for creating, engaging and

keeping your customer

Your sales & marketing plan

Your questions

How can I be of service to you…

right now?

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

AR = Accounts Receivable

POS = point of sale

POP = point of purchase

WMS = warehouse mgmt system

SKU = stock keeping unit

MOM = minimum order multiple

CPG = consumer package good

IND = independent retailer

UPC = universal product code

QR = quick response code

PO = purchase order

GMROI = Gross Margin Return On Investment

CRM = Customer Relationship Management

DSD = Direct Store Distribution

EDI = Electronic Data Interchange

EDLP = Everyday Low Pricing

OTB = Open-to-Buy

POG = Plan-o-gram

RDA = Retail Display Allowance

This packet of thought starters is

just that; a starting point. Let your

mind wander and consider what you

can do to help retailers minimize

risks and maximize profitability.

The 4 P’s of marketing ◦ Product, price, place & position

7 P formula for marketing success ◦ Promotion, productivity and “Profit-unities”

How will this product generate incremental sales?

What’s the difference between

your customers and your

consumers ?

How to sell or why retailers buy;

which do you prefer to learn?

Who are people more likely to

believe; themselves or you?

Ever had buyers remorse?

Show me the value; or I’ll show

you the door.

◦ Definition of Value: is a function of the bundle of

perceived benefits offered at a given price.

Do you sometimes wish you could

just read your buyer’s mind?

Top line sales and cash flow

Customer traffic

Customer profitability

Staff productivity

Return on investment; ROI

Do we really need that?

Inventory is the retail gamble

Help me move it; and promote it.

Make yourself irresistible to

crazy-busy customers

Complexity brings them to a

screeching halt

They subscribe to the “ If it ain’t

broke, don’t fix it “ philosophy

They think making risky decisions is

career inhibiting

Most of their options seem like near

clones of one another

Not tolerant of stupidity or

incompetence in other people.

Keep things simple

Demonstrate strong biz case

Minimize the risk

Prepare, prepare, prepare

Make your presentation in terms of the customer.

How they benefit, how they profit,

and how they produce will

provide value.

Taking a look at the initial

purchasing process from the buyer’s

perspective offers invaluable

insight to consider in your own

selling process.

Profit; make money or save time

Want to find something (new)

that turns over at a price that will

make them money

How can I keep my customers in the store longer?

Increases the average sale per customer

Look at products through the eyes of consumers to meet leading trends

Increased impulse sales = increase average sale/customer

What your biz background is

Your Financial means

Number of years in business

Geographical limitations ◦ What area can you physically cover and ship to?

Always remember while you are qualifying

them; they are qualifying you.

Trend watching; help me with

what’s hot.

Tell me about something new or

up and coming.

You need to know my customers.

Ask me.

I need to know your Advertising

and promotions plan.

How you are going to educate my

customers about your product

and get them to try it in my store?

Can you replenish quickly; do you

have a solid supply chain?

◦ Speed to market just as important (if not MORE

important) than the shelf price or cost of an item.

Shop the store ahead of time

Understand the strategic

positioning of the store

Keep things simple; make your

presentation short and snappy

Objections and roadblocks

Understand customers situation

Help me move product and make

money; frame your sale this way.

The answer is no...

If they feel pressure from you,

If they feel like you're trying too hard to be liked,

If they don't think you understand their business,

If they get overwhelmed by what you're saying.

Retail distribution channels consist of some combination of producers or manufacturers, agents or brokers, wholesalers or distributors, transportation, importers, and retailers.

3 Main supply chain channels... ◦ What is your cost to ship to your customer?

Wholesalers

DSD; ( Direct Store Delivery )

Chain; Self Distributors

Department stores

Mass & Big Box

Specialty & Discount

Catalogue & Internet

Grocery & Drug Stores

Convenience stores

Within each category; 3 types

Banner stores

Independent stores

Is the product WMS friendly?

Case and product UPC

Dealing with concealed damages

Case pack; smaller MOM’s?

Consider using a professional

agent, broker or wholesaler

◦ When you don’t have your own sales team or sales

is not your strong point

◦ There is a cost; however they have connections

and already established relationships

What you say and how you deliver

your “pitch” will make all the

difference...

Where else are you selling this

product? ◦ What makes it sell?

I need to know why your product

will be wanted by my customers. ◦ Is there a “market match”?

Is there a need or a market?

Or both?

A need alone does not = a market; desire does

Push or pull product?

Is your product future proof?

What is the life cycle of product?

Taste, health, ingredients,

appearance, sustainability,

preparation, packaging,

customer value...etc etc.

◦ all buyers do things for their own reasons, figure out

what the buyer wants and then provide it for them

Look for items that are different;

not the same; uniqueness

Must be easily understood by

store staff and consumers

Add interest and excitement to

their stores with new products

What retail price can I get for this

product?

Some look at product first;

◦ then see if they can ‘carry’ the price

Others look at cost first;

◦ they are judging the selling price and

then a product to fit or match

Setting the right price for your products and services requires balancing merchandising, pricing, placement, packaging, and promotion.

Do not compromise on your price

Know your competition

Know your taxes

Wholesaler upcharges

Brokers fees

Include all your costs

Mark up and margin

Gross profit percent; GP%

Gross profit dollars; GP$

Gross margin percent; GM%

Gross margin dollars; GM$

Tamper proof packaging

UPC code that stays on package

Display racks and trays

Display packages with a window

Off shelf areas for new mix

Plan-o-grams & compliance

Package size/dimensions

Photos

Must fit on a shelf in the section

or category it is merchandised in

A successful marketing plan doesn't

have to be complex or lengthy, but

should contain enough information

to help you establish, direct and

coordinate your marketing efforts.

Endure long receivable cycle

Provide dating

Provide prompt pay discount

Payment by credit card

Even risk not being paid

Provide a listing allowance

Prepay freight; delivery to door

Clear up damages and returns

Have a plan for recall

Sign a vendor agreement

Use a wholesaler or broker that

specializes in your product

Referrals are the way to go

Value in a short term incentive

Becoming the retailer & go online

The use of online business media

Carefully consider consignment

National chain retailers have

their own import department

Why do they need you?

Now what or what now? …

Your outlook is a matter of your

positive attitude and willingness

to help.

Retailers need new mix to create,

engage and keep customers.

Increase impulse sales and profit

Chain retailers like to act like

small retailers

IND retailers look for unique

products not in chains

How can you?...

Help them make money

Save them time

Make them feel safe

Make them feel special

Confidence is the #1 factor ◦ in determining what, from who and where retailers buy...

quality is #2, service is #3

selection is #4

and price is #5

Retailers are looking for new

products to differentiate their

stores...

They don’t have time to find them;

this is your opportunity!

Decide first if you want to

approach IND’s or chain retailers.

Then determine your exact ideal

retail customer and method of

distribution.

Start a sales & marketing plan.

Understand your target market

and it’s buying motivators. ◦ Retailer (your customer) and end consumers

Who, what, where, how and why?

Define your unique value

proposition and keep it current.

Focus on benefits not just features.

◦Value is the bundle of perceived

benefits offered at a given price

Your evaluation is appreciated

Want a copy of this presentation

with my speakers notes?

E-mail me; gerry@retailsos.ca

Follow Twitter: @passion4retail

Connect LinkedIn: Gerry Spitzner

Web: retailSOS.ca

Blog: gerryspitzner.com

Email: gerry@retailsos.ca

Online Biz Card: gerryspitzner.tel

Online Biz Card: retailSOS.tel

retailSOS.ca is a Vancouver-based retail consultancy guiding

small business owners to create, engage and retain great

customers by doing the right thing extraordinarily well.

Gerry Spitzner works as a management consultant supporting

retail and small business owners to achieve results by aligning

their vision and implementing marketing strategy with

operational execution.

Drawing on 35+ years experience in multi-site retail operations,

independent store ownership and wholesale supply-chain;

Gerry brings the leadership, knowledge and market awareness

of ownership and business development to retail and small

business owners to achieve growth objectives.

For mfr agents info: http://www.cylex.ca/vancouver/manufacturers%20agents%20representatives.html

For list of mfr agents; Google key words; *manufacturers agents vancouver bc*; or *{food brokers} vancouver bc*

For wholesalers; use Google key words; *wholesale (your product category i.e. clothing) vancouver bc*

WalMart Vendor agreement:

http://www.walmartstores.com/Suppliers/248.aspx

Canadian Tire vendor agreement:

http://corp.canadiantire.ca/EN/JoinOurTeam/Suppliers/Pages/Suppli

erRequirements.aspx

Target vendor agreement:

http://img1.targetimg1.com/wcsstore/marketing/ca/company/image

s/canada/pdf/Vendor_Online_Agreement.pdf

Home Depot vendor agreement:

https://homedepotlink.homedepot.com/en-

us/Related%20Documents/Canada%20Supplier%20Terms%20and%2

0Conditions02-04.pdf

For QR codes: www.qrstuff.com

For bar code info; www.gs1ca.org

Retail associations:

Shelfspace: www.shelfspace.ca

Retail Council of Canada:

www.retailcouncil.org

Sales questions: www.gitomer.com

Sales and personal development: www.briantracy.com

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: www.trendwatching.com

Pricing and margin definition:

http://en.wikipedia.org/wiki/Gross_margin

Little Red Book of Selling; by Jeffrey Gitomer

The Sales Bible; by Jeffrey Gitomer

www.gitomer.com

Be Different or Be Dead; by Roy Osing

www.bedifferentorbedead.com

Unmarketing: by Scott Stratten

www.unmarketing.com

Enchantment: by Guy Kawasaki

www.guykawasaki.com/enchantment

small business bc-retail distribution-09oct2012

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