Small Business Guides
Selling products to retailers is getting easier
4 min read
Wholesaling to chain stores used to be impossible. They wanted big brands and lots of product. But selling products to retailers is getting easier for small businesses. Laura Curtis of Malvi Marshmallow Confection has done it, and she says not to be afraid of the big guys.
Chain stores have mellowed
Laura’s small batch Malvi Marshmallow Confections are sold in big retail outlets like Anthropologie, Dean & DeLuca and Wholefoods. They approached her – and she says small businesses will be surprised how easy big retailers can be to work with.
Retail futurist, Howard Saunders of 22nd and 5th says the retail world changed a lot after the global financial crisis and now is a good time for small producers.
Common concerns when selling products to retailers and chain stores
Wholesaling your product to a chain store might seem scary. You’re probably worried that you’ll have to:
- give up all your information and ideas
- deal with a team of lawyers
- watch for hidden costs, or tricky fine print
- give big discounts and never make any money
In reality, chain stores understand the benefits of partnering with small batch producers like you – and those benefits are not all about price and profits.
Why big retailers suddenly care about brands like yours
Howard says small brands hold real appeal for modern consumers. Today’s customers are interested in authenticity – they want products “with values, not just value”.
As a result, chain stores are looking for artisan and craft products from local producers. It gives them kudos and brings shoppers into their stores.
The real value is your story
Big retailers don’t really need your product. They have plenty on their shelves already. And Howard says they’re not going to make much money selling your goods, either. Your real value to them is your brand.
If you plan on selling products to retailers, make sure you leverage your backstory. It doesn’t matter how small you might be – if you’re unique and interesting, you make their store more inviting.
“Small batch producers think they have to look big and sophisticated and already out there, already corporate – actually that’s not what the retailers want at all,” Howard explains.
Don’t waste your time trying to look polished. Focus on developing a compelling brand story:
- Be local
Do you use local materials or ingredients? Are your goods made using regional techniques?
- Find your artisan angle
Is there something unusual about what goes into your product or how you make it?
- Stay real
Try to make your packaging look and feel hand-crafted – you want to differentiate yourself from glossy mega-brands
How to approach a chain store?
Before launching Malvi Marshmallow Confections, Laura had worked as a buyer for retailers. As someone who’s been on both sides, she gave us some tips on how to get started.
- Find the right person
Check out a company’s website and use resources like LinkedIn to identify the right person to target within that organisation.
- Go to them
If you can, try visiting the chain store’s head office with samples. But make sure you email ahead to make an appointment.
- Get your product out there
Try to build some buzz around your product by selling at local markets, seeking endorsements from your customers, and staying active on social media.
Laura got a deal with Whole Foods when one of the company’s marketing chiefs spotted her product at a hole-in-the-wall restaurant. You never know where your break will come from so the simple message is get out there.
Tips for negotiating with chain stores
If a big retailer is interested in your product, you’ll need to negotiate a supply contract. Don’t be nervous. Many chain stores are ready to give you a solid deal. Treat it as you would any negotiation – be flexible, open and mindful of what you need out of the contract.
Laura and Howard shared some tips:
- Don’t lose sight of profit
Chain stores give your brand great exposure and credibility. You may be tempted to discount your product to get on their shelves. That’s ok – it’s a negotiation, after all – but make sure you stay profitable.
- Be wary of process changes
Retailers may ask for small changes to how you pack or label your product. That can seem like a simple thing to do in exchange for a deal, but Laura says it can really slow your business down. She turns down chain stores that ask for it.
- Tell your story
Recognise the value you bring to the chain store. Your brand is helping broaden their appeal, so take time and effort over how it’s presented in store.
Retailers are your partners – everyone should win
If you’re a small business, don’t overlook chain stores as a wholesaling option. Selling products to retailers of that size may have been tough in the past, but all that’s changing. It’s a great opportunity to gain visibility for your product and grow your business.
You’re never too small to think about big retailers.