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 ?


 Howto 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.

 I do.
 Ask me.


Ineed to know your Advertising
and promotions plan.

 Howyou 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

 Chain
 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?

Ineed 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/manufacture
rs%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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