The Supply Side: Learning more about the inside of a retail buyer’s mind
Submitted by The City Wire Staff on Tue, 10/27/2015 - 6:14pm
story by Kim Souza
ksouza@thecitywire.com
ksouza@thecitywire.com
Editor’s note: The Supply Side section of The City Wire focuses on the companies, organizations, issues and individuals engaged in providing products and services to retailers. The Supply Side is managed by The City Wire and sponsored by Propak Logistics.
Buyers from large retailers like Wal-Mart and Target sift through as many as 55 to 75 emails a week from folks wanting to get a meeting to pitch their products, said Vanessa Ting, a former Target buyer and now a retail consultant in Los Angeles for her company, Retail Path.
Ting, who recently spoke at the Selling to the Masses CPG School held in Bentonville, shared insight from a buyer’s mind with prospective suppliers hoping to get their products into mass retailers.
“Buyers see tons of great products that meet consumers needs but they are always hungry for more unique items the won’t just cannibalize the sales of other products in the category,” Ting said.
Prospective suppliers often make a critical mistake in their introductory emails to merchandisers, with Ting estimating that just 10% of the emails contain information needed for buyers to make a decision. The last thing a buyer wants to hear is a supplier touting product. She said if first pitching though email, it’s critical that prospective suppliers cut through the chase and get to the point.
MENTAL CHECKLIST
Ting said retail buyer’s have a mental checklist that is applied to each product pitch and prospective suppliers need to address the list early in the conversation. The first list item is that the product matters and Ting said buyers are primarily interested in differentiated product, not just a “me too” item on the shelf. She said suppliers also have to do a good job communicating the benefits of their product. For instance, they need to make sure it addresses an unmet consumer need or offers a better solution than a product already on the shelf.
She said the product packaging also is important and can’t be an afterthought. One item with packaging is that retail buyer’s know that consumers want easy-to-read labels, Ting added. The final item in on the retail buyer’s list is the price. She said retailers will want to make sure new items are correctly priced. But given that everyone has to make money, Ting also warned that prospective suppliers must protect their margins.
Ting said suppliers are smart to do their homework around the retailer’s merchandising objectives such as “Made in the USA”, “Better for You” health and wellness or Millennials, and then try to align their product to those merchandising goals. If a retailer is experimenting with a new format, that is also an open opportunity for suppliers to line up with solutions for things like less shelf space in smaller formats.
PITCH TO WIN
Ting also revealed her “Pitch to Win” model at the recent event. She said suppliers have to share sales potential with the buyer early in the conversation.
“Suppliers have to build a financial case around their product. Buyers objectives are to drive top line sales and profits,” Ting said.
Even for new products, Ting said suppliers have to show sales potential to get a buyer’s attention. She said the last thing a retailer wants is a risky product.
“If you have sales from another retailer present it to them as data to show your sales over a period of time. Are they growing? Look for positive upward trends in the sales data to present to the buyer. Retail buyers want to catch products when they are on an upward trend,” Ting said.
She said Internet sales of the product also need to be shown to the buyer. If the product has not yet been in brick and mortar stores, Ting said it’s possible to build a sales potential case from syndicated point-of-sales data from a like product if it can married with a case that all of the demand is not being met.
“Position yourself as top line sales driver. While it’s true that 85% of a buyer’s assortment stays put each year, there are opportunities for new suppliers to jump into the mix if they can garner the attention of the category merchant,” Ting said.
She said buyers also want to know how the supplier will help market their product because it’s both parties responsibility. Without a marketing plan of some sort, Ting said new suppliers are facing an uphill battle. Even if the marketing is handing out samples with store demonstrations or social media fan impressions, Ting said it’s relevant to a buyer.
STELLAR EXECUTION
Ting said reliability, supply chain management, inventory management and on-time logistics are part of a strong vendor relationship which is crucial if a supplier gets on a retailer’s shelves. She said small suppliers should look for business partnerships to help with execution because it’s difficult to do it all well when you have a company to run. She said brokers or consultants who already have credibility with the retailer can help suppliers get new products onboard.
“Retail buyers are wary of vendors who haven’t been in the market for very long. Brokers and business partners can often clear this hurdle for a first-time supplier,” she added.
Ting said suppliers typically have six months to prove themselves at retail. She said monitoring the sales of new products is important because if a product is not selling, the supplier will need a plan to boost sales to keep their spot on the shelf.
“Incremental sales matter to buyers, but they don’t necessarily want to be trading sales on the shelf which is why it’s equally important for new suppliers to state their case for marketing support,” Ting said.
She said some products lend themselves to being cross-merchandised or sold in multiples which is a way for the buyer to add incremental sales to their top line revenues growth. New product innovations like the Swifter mop also drive incremental sales and buyers love to see new products that raise the bar. Ting said suppliers also need to look for ways to add new bells and whistles to improve existing products and allow them to be sold at a higher price, which also can lift a buyer’s overall sales.
As a consultant, Ting said she recently got a new product into Wal-Mart Stores for a client in one 20-minute meeting. She said the key to that success was telling the retailer what they wanted to hear. It didn’t hurt that the product helped the retailer fill a white space; in other words it was a created to fill an unmet need. There was no sales history, so they built a case around sales potential based on documented consumer demand and a lack of product.
“On the flip side, I have seen folks pitch for two years before they got a yes from a retailer. You want to give the buyer something to chew on. Be scrappy and resourceful,” Ting said.
Ting, who recently spoke at the Selling to the Masses CPG School held in Bentonville, shared insight from a buyer’s mind with prospective suppliers hoping to get their products into mass retailers.
“Buyers see tons of great products that meet consumers needs but they are always hungry for more unique items the won’t just cannibalize the sales of other products in the category,” Ting said.
Prospective suppliers often make a critical mistake in their introductory emails to merchandisers, with Ting estimating that just 10% of the emails contain information needed for buyers to make a decision. The last thing a buyer wants to hear is a supplier touting product. She said if first pitching though email, it’s critical that prospective suppliers cut through the chase and get to the point.
MENTAL CHECKLIST
Ting said retail buyer’s have a mental checklist that is applied to each product pitch and prospective suppliers need to address the list early in the conversation. The first list item is that the product matters and Ting said buyers are primarily interested in differentiated product, not just a “me too” item on the shelf. She said suppliers also have to do a good job communicating the benefits of their product. For instance, they need to make sure it addresses an unmet consumer need or offers a better solution than a product already on the shelf.
She said the product packaging also is important and can’t be an afterthought. One item with packaging is that retail buyer’s know that consumers want easy-to-read labels, Ting added. The final item in on the retail buyer’s list is the price. She said retailers will want to make sure new items are correctly priced. But given that everyone has to make money, Ting also warned that prospective suppliers must protect their margins.
Ting said suppliers are smart to do their homework around the retailer’s merchandising objectives such as “Made in the USA”, “Better for You” health and wellness or Millennials, and then try to align their product to those merchandising goals. If a retailer is experimenting with a new format, that is also an open opportunity for suppliers to line up with solutions for things like less shelf space in smaller formats.
PITCH TO WIN
Ting also revealed her “Pitch to Win” model at the recent event. She said suppliers have to share sales potential with the buyer early in the conversation.
“Suppliers have to build a financial case around their product. Buyers objectives are to drive top line sales and profits,” Ting said.
Even for new products, Ting said suppliers have to show sales potential to get a buyer’s attention. She said the last thing a retailer wants is a risky product.
“If you have sales from another retailer present it to them as data to show your sales over a period of time. Are they growing? Look for positive upward trends in the sales data to present to the buyer. Retail buyers want to catch products when they are on an upward trend,” Ting said.
She said Internet sales of the product also need to be shown to the buyer. If the product has not yet been in brick and mortar stores, Ting said it’s possible to build a sales potential case from syndicated point-of-sales data from a like product if it can married with a case that all of the demand is not being met.
“Position yourself as top line sales driver. While it’s true that 85% of a buyer’s assortment stays put each year, there are opportunities for new suppliers to jump into the mix if they can garner the attention of the category merchant,” Ting said.
She said buyers also want to know how the supplier will help market their product because it’s both parties responsibility. Without a marketing plan of some sort, Ting said new suppliers are facing an uphill battle. Even if the marketing is handing out samples with store demonstrations or social media fan impressions, Ting said it’s relevant to a buyer.
STELLAR EXECUTION
Ting said reliability, supply chain management, inventory management and on-time logistics are part of a strong vendor relationship which is crucial if a supplier gets on a retailer’s shelves. She said small suppliers should look for business partnerships to help with execution because it’s difficult to do it all well when you have a company to run. She said brokers or consultants who already have credibility with the retailer can help suppliers get new products onboard.
“Retail buyers are wary of vendors who haven’t been in the market for very long. Brokers and business partners can often clear this hurdle for a first-time supplier,” she added.
Ting said suppliers typically have six months to prove themselves at retail. She said monitoring the sales of new products is important because if a product is not selling, the supplier will need a plan to boost sales to keep their spot on the shelf.
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She said some products lend themselves to being cross-merchandised or sold in multiples which is a way for the buyer to add incremental sales to their top line revenues growth. New product innovations like the Swifter mop also drive incremental sales and buyers love to see new products that raise the bar. Ting said suppliers also need to look for ways to add new bells and whistles to improve existing products and allow them to be sold at a higher price, which also can lift a buyer’s overall sales.
As a consultant, Ting said she recently got a new product into Wal-Mart Stores for a client in one 20-minute meeting. She said the key to that success was telling the retailer what they wanted to hear. It didn’t hurt that the product helped the retailer fill a white space; in other words it was a created to fill an unmet need. There was no sales history, so they built a case around sales potential based on documented consumer demand and a lack of product.
“On the flip side, I have seen folks pitch for two years before they got a yes from a retailer. You want to give the buyer something to chew on. Be scrappy and resourceful,” Ting said.
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