David Austin, store manager at Westridge Market, is a local products incubator of sorts, offering guidance to hopeful fledgling manufacturers, many of which didn't fly far from the nest to reach him in Ojai, Calif. Read on for his make-or-break must do's for any brand trying to land retailer real estate.
1. Call, come in to meet buyers
From his oft-approached retail perspective, Austin hears from many an excited entrepreneur. His first suggestion: get your face in front of retailers.
"We're in the email generation where there's very few face-to-face, personal communications, and I think that a lot gets lost—you don’t get to meet that person and see their face light up when they talk about their product and see that passion they have," he said, adding that a personal connection is important to breaking in, with such enthusiasm definitely influential on a buyer.
To establish that connection, a quick call for introduction and meeting request is the most effective approach, according to Austin. Once in, he recommends a to-the-point presentation that gives a buyer as much relevant information as possible before leaving them with some samples.
When retailers have a little more time to give, smart product pioneers come prepared with a lot of questions, Austin said. Based on the most common pitfalls he's observed in this natural product-to-market process, some of the best inquiries should surround the following…
2. Determine category and consumption rate
To which category are you gearing your product lines? This self-facing question goes unasked by many whose product, for instance, starts with a family recipe receiving rave reviews at a party—a story Austin hears often. Also consider the product type's consumption rate, "meaning, how quickly [a consumer] would go through an item."
As an example, peanut butter takes, say, an average of one month to go through. But a 16-oz. single-serve lemonade or 5-oz. bag of organic potato chips is gone in a single setting. "So your consumer is going to purchase maybe 10 to 15 lemonades in a month, but they can only really purchase one peanut butter."
3. Sort out packaging/labeling requirements
In Austin's estimation, a lot of local companies come "from the farmers market, where they're just packaging and selling [their product] in a mason jar with a mailing label and some ingredients on the top." packaging and labeling requirements are a couple aspects on which to be up to speed. "To get into retail, there's a lot of stores requiring a UPC or a barcode; a lot of the major stores require product-liability insurance."
4. Iron out pricing and production cost
Structuring product pricing is another key factor, and Austin encourages making volume discounts available. "If you want to sell a case at a time at a set price, that's okay, but in order to get some sales generated, providing some volume incentive for the buyers—if you buy 50 cases, then we'll throw in this many free or we'll drop the unit cost down to this—that's important because most local product companies just set one price and don't really understand the value of having a pricing structure that is an incentive to buy in bulk."
Taking a step back from pricing, production cost holds major implications for a product's success. "The ability to produce the product as cheaply as possible is really what allows you to take that next step beyond distributing yourself in your local area," said Austin, naming inexpensive labels and packaging as part of the equation. Lowering production and product cost enough to create margin room for distributors are necessary steps to brand growth beyond local, he continued.
While consumers continue to show their love for local, ultimately, price is still a factor. "A jar of pesto sauce made locally is great, but if it retails for $9.99, it's going to be a slow mover. If it retails for $4.99, it may be a dollar more than the national brand on the shelf next to it, but the consumers are usually willing to pay a little bit more for a local brand," he explained. "They just have to get that price point in the ballpark."
5. Sample for success
Above all else, Austin wishes that all new brands trying to land a spot on his shelves knew this: "the value of sampling." Circling back to the power of face-to-face interactions, "You can't sample enough; you can't get out there and do enough demos," he said.
From a vendor standpoint, branding yourself as part of the line and putting a face behind a product is all part of creating an identity consumers can connect with. He sees sampling as a definitive point in a product's success, where sharing stories of creation and ways for consumers to relate and associate with your product are all ingredients in brand loyalty.
However valuable, sampling is also labor intensive, and may elicit some negative feedback, Austin cautioned. Even so, "don't outsource your demo, get out there and do it yourself. Nobody's going to be as passionate about your product as you are." For best results, sample consistently a few weeks in a row—people will remember you, and may be tempted to try/buy your product on a future pass.
"We're such creatures of habit as it comes to our shopping; we come in, get what we're used to, we get what we know. But when somebody's there, and they're pushing a sample on you, you might turn it down the first time, but the second time, the third time, if they're consistent with it, I think that can be a big influence."