How to Pitch Your Product to a Store
When Felix Design, a four-employee startup that makes cases and stands for smartphones and tablets, launched two years ago, founder Chris Michaud knew it was important not only to sell products online, but also to sell them through traditional retailers. "The reality is, if you don't have SKUs in the stores, you're not going to have a healthy business," he told Inc.
So far, Felix has gotten its products onto shelves at Staples and the Apple Store, and is en route to $1.5 million in annual sales. How did the company do it? While designing for end users was of obvious importance, the products also needed to appeal to brick-and-mortar retailers. After all, persuading the stores to stock Felix's items was a key step to reaching those end users.
Which is why Felix's products have a demonstrably playful vibe. It's a vibe that practically screams, "Buy me! I'd make a great gift, especially if your child loves using these devices." For example, the MonkeyDo is an iPad stand that truly resembles a monkey. Likewise, the TwoHands, also a stand for tablets, has two small "hands" that actually hold up the device.
You can summarize the lesson like this: Retailers are your customers, too. You need to deliver what delights them (high margins, stop-and-stare visuals) and avoid what aggravates them (onerous ordering procedures, space-consuming displays).
All this is especially true if you're trying to crack a successful boutique like Massachusetts-based Isabel Harvey, which sells jewelry, clothes, accessories, and other items from its locations in Wellesley and Nantucket. Co-founders and co-owners Kimberly Kissam and Alexis Kissam--also sisters--opened the stores in 2005. In the last three years, Isabel Harvey has increased sales by an average of 35 percent annually--no small feat in this (or any other) retail climate.
If you're hoping to sell your wares at a boutique like Isabel Harvey--whose customers view it as a curator of stylish jewelry, handbags, and scarves--here are seven things you should be sure to do:
1. Master the margins. "The standard markup for this business is 2.2, 2.5, right around there," says Kimberly Kissam. In other words, Isabel Harvey (and most boutiques) typically sell products at more than double (but less than triple) of their overall cost.
So if you're trying to persuade a retailer to carry your products, you need to consider their margins as much as yours. In other words, your pricing strategy has to demonstrate an understanding of theirs.
As obvious as it sounds, you need to err on the side of a larger margin. For instance, most brick-and-mortar retailers (including Isabel Harvey) do a lot of business online, too. In those cases, their cost is not only what they pay for the product itself, but also what they'd have to pay to ship the product to a customer. As a supplier, you have to factor such added costs into your pricing equations.
2. Visit the store in person to make your pitch. "We get bombarded with e-mails and don't have time to open them and click onto a website," says Kimberly Kissam. "But if a designer comes here and we're available even for one split second, we'll get our eyes on their product and take a meeting in the future--or even right now."
The other benefit to visiting in-person is that it gives the retailer a chance to conduct what amounts to a job interview. They can look you in the eyes, ask you questions, gauge your own sense of style and manners, and come away with a hunch about your potential as a reliable partner.
3. Bring samples of actual products, or at the very least, photographs. You can't expect a retailer to make a decision without viewing, touching, carrying, and even smelling the product. It's not just a simple matter of assessing quality. They also need to see how the product fits in with the rest of their inventory, in terms of pricing, selection, shelving, and store aesthetics.
4. Grasp the retailer's competitive advantages in the marketplace. Generally speaking, a boutique with one or two locations cannot and does not compete on price with chains. It competes on quality and selection. They aim to sell what's hard to find--and what's more stylish--than what you'd find at chain stores.
This doesn't mean they're expecting exclusives from their suppliers. But they'd prefer not to see your product at a chain--or at the store next door either. "We always ask our designers to be fair and reasonable," says Alexis Kissam.
She points out that saturating your product at several regional stores isn't ideal for the supplier in the long run, either. Remember, the aim isn't to sell to multiple retailers, once; it's to form retail partnerships that provide strong branding, high visibility, and long-term footholds in the marketplace.
5. Have a sell sheet. What is a sell sheet, you ask? Exactly what it sounds like. It's a one-page brochure that you can leave with the retailer, telling her everything she'll need to make a decision about stocking your product. For a thorough sell-sheet checklist, you should check out the one posted by serial entrepreneur Michelle Spelman on the site of the International Toy and Game Innovation Conference.
At the very least, your sell sheet should include:
- Product images, including what it looks like in a store display
- Pricing information, indicating your grasp of the retailer's pricing pressures
- Ordering information
- Customer and partner testimonials
- Your contact information
All the usual reminders matter here too. Ask someone you trust to proofread and provide feedback about how you can edit and clarify your sell sheet.
As routine as having a sell sheet may sound, many designers neglect to bring one when they visit Isabel Harvey, notes Alexis Kissam. And sometimes, even if they bring one, it doesn't include the relevant pricing information.
"Designers are designers," she says. "What I find is dollars and cents can trip everyone up. The sell sheet should show a clear understanding of what it costs them to make the product and how much the retailer will sell it for. You have to be confident and clear about that."
6. Prioritize your packaging. Retailers want stocking and shelving to be fast and smooth. They also want to avoid long lines at the register. If the product comes prepackaged in a small, gorgeous, bar-coded gift box, everyone's life is easier.
By contrast, if the product is unwieldy and requires detailed attention at checkout, it can become onerous to the retailer. (All of which is another reason why it pays to bring samples when you visit the store.)
Yes, your product and pricing are important. But the retailer is also assessing if your packaging can help streamline the customer experience.
7. Show your marketing might. Convince the retailer that you'll work hard to promote your products and lure people to the store. How important is this? If you do it well enough, there's a small chance you'll get a pass on some of the above.
"We sell a perfume called Kai," explains Kimberly Kissam, by way of example. "The markup is terrible. The only reason we carry it is because they have unbelievable marketing. And [Isabel Harvey] is on everything they send out. People come to the store, looking for us.
"And they have a huge audience," she adds. "Plus their packaging really looks good in our store. It's clean white with green lettering on it." All told, the Kissams believe that the publicity they garner through Kai's marketing is far more cost effective than conventional advertising.
Of course, it also helps that customers like the product. And what retailers want, in the plainest terms, is to please their customers. If they're convinced your product will help them in that quest, you'll be well on your way to a fruitful partnership.
How to Pitch Your Product to a Store
Source: https://www.inc.com/ilan-mochari/cracking-boutique-retailers.html