Never underestimate independent retail

Whole Foods Market stores account for nearly one-third of the population of natural food retailers. These stores represent 3 percent of total store count and roughly 30 percent of approximately 900 stores that account for over 80 percent of natural product sales volume. Additionally, Whole Foods Market accounts for 35 percent of UNFI’s total company sales.

Many companies judge the health of their business by their distribution at Whole Foods Market, but as numbers indicate, there are lots of opportunities outside this national chain. The largest sales segment within UNFI (the leading natural product distributor nationally) is the Independent Natural Food Store category, at over 36 percent.

So, how should you go about tackling this segment of stores?

1. Prioritize. Focus on the top-tiered accounts in each region. Work with your broker to identify and prioritize the accounts with the best potential for your products.

2. Present trade promotions that are flexible and simple to understand, present and evaluate.

3. Work closely with your broker (or sales people) to implement the program. Get input from your brokers on “what works” in their region and with the majority of their independents. Get involved, especially at the early stages of program presentations, so you get first-hand knowledge of any unforeseen problems on the implementation end of your plan. Many promotions have failed in the implementation phase.

4. Evaluate the overall promotional effectiveness. Often overlooked, it’s very important to learn what worked and didn’t work so that your promotional effectiveness continually improves. Don’t simply look at product sales through a distributor (many factors such as a promotion with a national chain could be the reason for spiked sales). Speak with individual broker representatives and retailers themselves to get their input.

5. Consider an EDLP (everyday low price) or EDV (everyday value) program to build strong relationships.

This article is an excerpt from the Natural Products Field Manual, Sixth Edition, a guidebook and resource compendium for entrepreneurs in the natural products and specialty foods markets. Authors Bob Burke and Rick McKelvey describe it as “the book we wish we had when we were starting out.” The Field Manual is a no-brainer for anyone bringing natural, organic or specialty products to market. For more information, click here.