Archive for the ‘Walmart’ Category

Do You Need The Lowest Price To Sell A Major Retailer?

Thursday, November 25th, 2010

You have probably heard you need the lowest price to sell your product to a major retailer.

Major retailers don’t like to take risks and they want to buy a product that is already a proven seller. If you can prove your product sells well for other retailers, that removes much of this risk.

Then, as long as they believe they will make more profit from your product than whatever it replaces, and if you can convince them that you will be a reliable supplier, they’ll give you a test.

For all of my product lines, I always started with Target because I found them to be more receptive to new ideas. Once I had good sell-through numbers from Target, getting into Wal-Mart was a lot easier.

MY “SECRET FORMULA”

Here’s how I was able to have a 95% success rate with my new products…

I found a product category that was already selling well and then improved on it to make it sell better! This is a lot less risky than a completely new invention no one has ever seen before.

When I introduced my new school supply line, I was selling a category already known to sell well and I was the first company to make school supplies with a holographic “look”.

This allowed me to sell a 2 pocket folder to retail at $1.99 when my competition was retailing at $0.69! Because these products sold so well, I got a “Best New Vendor” award from Target’s stationery & school supply department.

Don’t let anybody tell you it’s necessary to have the lowest price.

It isn’t.

If you have a higher priced product that can sell the same unit volume as the lower priced products, the retailer will make much more money with your product and you can get away from concerns about price. Be prepared to prove it though. . .

Can You Sell From a Prototype?

Friday, November 19th, 2010

Another frequent question we get is whether you can approach Wal-Mart or another major chain with only a prototype with the plan of getting an order to fund production.

We also get asked if Wal-Mart or other retailers will either buy your idea or product and finance the production for you.

The answer is no & no.

Wal-Mart, Target and other major chains are as concerned about prompt delivery as they are about your product’s saleability.

If all you have is a prototype and need financial help to get into production, that tells them you do not have the financial strength to do business with them.

But don’t despair. All hope is not lost. You can still use your prototype to:

1. Make a licensing or joint venture deal with a company already supplying the chain you want to get in. You will want to find a company already in your target account’s stores who is already selling into the department your product belongs in and who does not have any directly competitive products to yours.

2. Make a joint venture deal with another company to finance production. One good prospect for a JV is whoever will be making your product for you because they have a vested interest in it’s success.

3. Make a deal with a smaller retailer explaining your situation and offering them a head start over any of their competitors.

3 Myths About Selling to Wal-Mart

Thursday, September 23rd, 2010

In talking with people who would like to sell their products to Wal-Mart, I have seen 3 misunderstandings people have about doing business with Wal-Mart that keep them from even trying.

Myth # 1:

You Have To Be a Big Company To Sell To Wal-Mart

Wal-Mart has 61,000 United States suppliers and thousands more international suppliers, so they can’t all be large companies. Small companies still need to meet their vendor requirements, but if you are applying under their “store of the community” program, you can start by supplying only a few stores and don’t have to meet the same financial requirements as a national vendor.

Myth # 2:

Wal-Mart Will Beat You Down On Price So Much You Will Not Be Able To Make Any Money

It’s true that some suppliers don’t make any money, but those are the suppliers who are selling a commodity and whose products are identical to their competitors so it all comes down to price. In that situation, the lowest cost producer may be the only one to make money. None of my products were commodities and because they were all unique and different so I was able to make good profits dealing with Wal-Mart.

Myth # 3:

Wal-Mart Doesn’t Pay On Time And Will Make You Wait 6 Months To Get Paid

As long as you follow their procedures, you’ll get paid on time. The last time I dealt with them, I offered them an extra discount if they paid in 10 days and they took the discount and always paid on time. When you get set up as a vendor, your pricing and payment terms will be part of your agreement and they will honor those terms. My opinion is that they are one of the most ethical retailers I have ever done business with.

Do You Need The Lowest Price To Sell A Major Retailer?

Wednesday, September 22nd, 2010

You have probably heard you need the lowest price to sell your product to a major retailer.

Major retailers don’t like to take risks and they want to buy a product that is already a proven seller. If you can prove your product sells well for other retailers, that removes much of this risk.

Then, as long as they believe they will make more profit from your product than whatever it replaces, and if you can convince them that you will be a reliable supplier, they’ll give you a test.

For all of my product lines, I always started with Target because I found them to be more receptive to new ideas. Once I had good sell-through numbers from Target, getting into Wal-Mart was a lot easier.

MY “SECRET FORMULA”

Here’s how I was able to have a 95% success rate with my new products…

I found a product category that was already selling well and then improved on it to make it sell better! This is a lot less risky than a completely new invention no one has ever seen before.

When I introduced my new school supply line, I was selling a category already known to sell well and I was the first company to make school supplies with a holographic “look”.

This allowed me to sell a 2 pocket folder to retail at $1.99 when my competition was retailing at $0.69! Because these products sold so well, I got a “Best New Vendor” award from Target’s stationery & school supply department.

Don’t let anybody tell you it’s necessary to have the lowest price.

It isn’t.

If you have a higher priced product that can sell the same unit volume as the lower priced products, the retailer will make much more money with your product and you can get away from concerns about price. Be prepared to prove it though. . .