Selling Through Distributors - a free komida guide



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Tip #7 - Consider Whole Foods Market

If you are selling to specialty food retailers and independent grocers it is important to consider their primary value proposition to their customers:

a unique retail experience

If you can help your customers achieve this goal, they will value it.  

Consider Whole Foods, 
who has made achieving a unique retail experience systematic:
  • Small Producers - Small producers have limited reach and market presence.  Chances are, Whole Foods will be one of the only retailers carrying their products.
  • Exclusive Products - If you have a good relationship with Whole Foods, expect them to ask you to develop an exclusive product for them. 
  • Unique Combination - Organic, Natural, International, etc. there selection is broad and diverse.  Not to mention their prepared foods, juice stands, and other services.
  • Private Label - Private label products (365) are only available in the stores that branded them.
  • Local Products - There are many companies that have not or cannot distribute their products outside of a certain geographic range.  Whole Foods is willing to work with them even if they only stock a single store.
  • Local Producer Loan Program - If Whole Foods likes your products and wants you in more of their stores, you are a good candidate for a Local Producer Loan.  When you use it to grow, Whole Foods will become your biggest buyer.  
  • Select Distributors - A distributor will usually sell to the store next door as well.  Whole Foods realizes this and seeks products and distribution paths that are unavailable, difficult, or unexplored by other retailers.
  • People - Whether they are Whole Foods employees or others giving tastings, Whole Foods knows the value of a personal approach. 
  • Ancillary Investments - By supporting local and worldwide communities, you feel differently about buying products at Whole Foods.
Most products by themselves are relatively unique, but there are many ways to increase uniqueness.  Take Whole Foods' lessons and consider distribution, promotion, service, and more.  

The most straightforward way to increase uniqueness is exclusivity, and remember, exclusivity does not need to be absolute.  For example, you can offer local (within a 30 miles radius or zipcode) or temporal (6 months) exclusivity of your product .  Exclusivity is a double-edged sword, but don't worry, if you have another buyer interested, you can leverage that demand to help you improve your relationship (better pricing, promotions, etc.).  

Whole Foods understands its value proposition and so should you.  There are many ways to help "create a unique retail experience", so make sure to emphasize the value of your uniqueness when you have the chance.  Good luck!

If you have any insights to include, please contact me through www.komida.com.  Thanks!

Tip #6 - Don't put all your eggs in one basket

Whether it is a distributor or a large retailer, be wary of letting any single relationship represent too much of your business.  There are countless horror stories of businesses that failed when they lost a single account that represented the majority of their profits.

Ryan Montague from Gourmet Business Solutions, a forward thinking consultancy with fresh ideas on the specialty food industry, wrote the below article that includes Costco's position on being a supplier's biggest customer.  

He makes the situation very clear in his post:
For example, I learned that Costco typically doesn’t like to sell to a business whose sales with Costco represent more than 20% of their overall business. The reason: Costco doesn’t want to be the “bad guy” if they drop a Costco-dependant line that could sink without their business from Costco. Just goes to show that all the corporate giants aren’t so cut-throat after-all (which is common when dealing with the larger food retailers and distributors).
http://blog.gourmetbusinesssolutions.com/2009/01/02/selling-food-to-club-stores-costco-sams-club-bjs/

Tip #5 - Sell through specialized online retailers

How would you describe your company and products?  
What would you consider your strengths?

Chances are you can find an online store that sells products that fit your same description.  

If you answered small, local/regional, artisanal, gourmet, or handmade, there are some new sites out there worth looking at.

New Online Food Marketplaces:
  • Foodzie - www.Foodzie.com
  • Foodoro - www.Foodoro.com
  • Regional Best - www.RegionalBest.com
Use these sites to get your product in front of others, they sometimes have a lot more visitors than your website, so they can really help people find you.

Each of these companies has a slightly different emphasis, so browse their offerings and see which is most right for you.  

I am happy to say that each of these companies shares a vision with komida: they are determined to help your business succeed.

If you would like to see your food marketplace added to the list, please contact me through www.komida.com.

Tip #4 - Take the NASFT course

There are few resources for understanding the specialty food industry, but one stands out, the NASFT course offered at every Fancy Food Show: The Basics - The Business of Specialty Foods. 

http://www.specialtyfood.com/do/fancyFoodShow/EducationalPrograms

The NASFT is the resource for independent food manufacturers hoping to plug-in to the broker, distributor, and retailer networks.  You might not plan on selling with brokers, through distributors, or at big-box markets, but this course is invaluable in helping you understand the industry and the marketplace, so you can be better prepared to guide your business to success.

Tip #3 - Co-brand promotional materials

One of the greatest fears of creating promotional materials is that the materials are only available or on display for a short time, and their costly expense will not prove warranted.

One creative solution we have found some of our clients using is to co-brand materials.  By offering a portion of the area for promotional material to your wholesale partners, you give them reasons to keep your materials up and consider them their own. Try half a poster, the back of a brochure, or even their logo on a display case, there are opportunities for co-branding on every piece of promotional material you make.

Here are some of the benefits:
  1. Fewer replacements.  The additional expense of customizing promotional materials will be offset by having to replace the materials less frequently.
  2. Sense of shared ownership.  Since you are including your partner's branding on your materials, they will start treating them as though they own them as well.
  3. Relationship building.  Co-branding is a great way to help make your relationship more personal and show your commitment to its success.
Tom with Key West Smoked Fish Company took this idea one step further, and instead of including custom content for each buyer, he was able to find a message that made sense to many.  A beautiful photo, a game, trivia, etc. are all possibilities.

Don't be afraid to be creative, and use things like stickers to make co-branding easy and cost effective.

Tip #2 - Use your customer lists to get wholesale accounts

By keeping track of where your customers reside, you offer potential wholesale buyers another reason to carry your products: automatic customers.

In addition to giving a wholesale buyer the assurance that a product will "work" in their area, offer your customers something special as well. Promise your wholesale buyers that you will send an announcement (and maybe a coupon) to each customer that lives in their area announcing a product's availability at their store. This co-advertising is really valuable, and a potential buyer will see how you are willing to leverage your customer lists to help guarantee the success of the relationship.

Tip #1 - Sell your products everywhere

Some of komida's clients have stopped thinking of food markets as their only clients, and have been able to significantly increase their sales, even within a small geographic area!  When you start thinking about your potential wholesale partners as all places that could sell your products, and not just traditional markets, you will be at an advantage!

Finding alternative channels such as wine shops, cigar bars, salons, clothing boutiques, car dealerships, and more can do wonders for your sales!  

Here are some of the benefits:
  1. Limit your competition.  If you are the only food product in the store, you are the only option a buyer has.
  2. Great promotion.  By being one of the few products available, it is much easier to be in the spotlight.
  3. Leverage brand associations.  If you are available at a luxury car dealership, it is easy to see how you will be considered a luxury brand.
  4. Be there for your customers.  Where do your target customers shop?  This could be a perfect place to offer your product to them.
  5. Diversify.  With more channels, you will be able to adapt better to changes in the marketplace.  A customer that shops less at one store may end up visiting another more frequently.
You can be surprised at how well some alternative channels move your products.  Nurture these relationships, and they could end up bringing in the majority of your sales!

Business is personal

This blog started as a personal blog:
"A medium for sharing experience with food and eating among friends"
and you can see some of our archived posts below.  

Thank you Monica, Mom, Bea, Amy, Simon, and Shota for your truly rewarding posts.  I hope they are found by many.

Since 2007, komida has also been the name of my business, and I am excited that business is just as personal.  As komida grows, the most rewarding part is the people I am fortunate to meet.  The tagline, "Food is Personal", is meant to capture the critical truth, that in business as in life, the most important parts are the people and the relationships between them.

I am looking forward to all the relationships komida will bring, and look forward to sharing a new experience with these new friends.


komida is the name of my company

For all the love of food, I figured out a way to make the world a better place.  

Check out my company komida.