How To Sell To Grocery Store Chains

July 17, 2017

It was a trend some time back that grocery store chains normally did not accept products from small manufacturers. It was done for two main reasons. First, they wanted to keep all of their stores stocked with the same, if not similar products, so that there is a continuity between shops, and second, small manufacturers may not be able to supply to meet demand should the products become successful. Branching out immediately and supplying large volumes might just not be possible. The trends, as they do have turned in favor of small businesses now. The main reason is that mainstream products tend to lose their sheen. New products come from fresh minds and can be really appealing.

 

Here are a few pointers that will help you sell to chain stores

 

There are many ways to sell to grocery store chains and one of the way that is likely to push big volume for you as a maker is to sell white label. Selling white label to a chain is done by giving your product to the chain store to sell under their own brand. You might have seen grocery store chains that have their own ‘in-house brand’, all of these products are sold to them by smaller manufacturers who might not be able to create their own brand and bear the costs of marketing. According to Forbes, it is a solution for those who are, at the moment unable to market by themselves. By trying to do everything at once, you might be setting yourself up for failure. In the beginning, especially if you are a small firm with limited resources in terms of money as well as human capital, you are better off concentrating on one thing at a time.

 

If you are able to create a product that is really worth the price it demands in the market, then you are sure to strike it big. By using the help of a chain store to sell, you are maximizing on profits as your marketing will be close to nil and the power of the brand is brought to the table by the seller. There are other solid reasons as to why white labeling is the best way forward.

 

  • You might not have the expertise required to push a product into the market, more so, if there are already established names in stores.
  • If your competency is not marketing, then you will need to learn on the fly and this can go both ways. You might be left with too much on your plate and your products lying in the warehouse. If you use a store’s name to sell it, it can be in the hands of end users, where it belongs.
  • End up spending more money than necessary in tools to get you started. You might as well put into the product and make sure you are focusing on the best your products can be. Marketing, if not handled by an expert, can be a distraction.

A white label product is one that is made by one company but sold by another. That means you are the one who has all responsibility for the product. You make, deliver, support, and service the item. Only the selling is done by the store in this example. Products sold this way are normally packaged without a brand name and put into plain featureless packaging. The store you are tied up with can then customize it to their liking and sell it with their logo on the pack. You will be surprised to see the actual quantity of goods you can push through white labeling. There are, however, downsides as well. For one, you will need to make do with a small margin for profits and you might be contractually obliged to keep your product within the one brand name for a fixed period of time.

 

In many cases, products that have the ability to make it big are quickly taken up by large retailers to sell under their own name and soon, you can be shipping massive loads to their warehouses. The downside here is that the product’s price is usually determined by the seller. You will have to go with it, at least when you start off, just to get your product moving. After you establish yourself, you can make moves to increase or decrease the price.

 

Another option that you have is to sell directly to grocery store chains without any distribution help. By doing this, you have a chance to present your brand to the customers without the help of any marketing or such tactics. You will be selling based on nothing but the power of your own product. You need to understand though that there may be other brands on sale, including the in-house brand. So you need to either enter the market as a premium brand or a low cost one. Both are viable options with their own risks. One way to solve this conundrum is to go with a price that is close to or matching your closest competition. That way, you can command a fair market price and the product will come off as being worth the time and money of the people who buy it. Make sure that you make a decent profit at the sale price. The markup, as well as the cost, will typically go to the seller, so be aware to not sell at a high price point, this will make it difficult to push in the market.

 

Make sure that the product you seek to sell works in the locality, the kind of store you approach and the general demographics of the population in it. If you go to grocery store chains that do not really have anything to do with what you sell, there is no point in being even the best in the business.