GETTING YOUR PRODUCTS INTO DISTRIBUTION
Selecting and Getting Into Distributors
In most cases, choosing which distributor to work with usually happens as a result of getting acce?pted to a store. Once the store buyer accepts products, they inform the sellers which distributor they use, or give them a list of approved distributors that they work with.
Presenting to Distributors
It is possible to directly present to a distributor for inclusion in their catalog. Successfully presenting products directly to distributors without presence in national food chains is very challenging, as distributors do not want to assume the inventory risk for unproven products.
Once your product(s) is in stores, a best practice is to approach the distributors with a “me too” strategy. For example, “We are working with <large buyer name> and it would be beneficial for you to carry our products.”
Note: sometimes, this results in working with two different distributors who supply the same store; who the buyer orders from depends on how good the distributor relationship is with the store. You always want to work with a distributor who has the best reputation.
How Brokers Can Help
Brokers are independent people whose connections and industry knowledge help bring deals together between buyers, sellers and distributors.
Although distributors carry your product(s), introductions to buyers/customers are not necessarily guaranteed. Brokers (and broker-like services, such as Buyer’s Best Friend) fill this void and have a reputation for presenting winning products. They function as an introduction for smaller brands to distributors with whom they already have long-standing relationships. Their expertise and opinion factor heavily in distributors’ ordering decisions.
WHEN TO CONSIDER CHANGING YOUR DISTRIBUTION
Small distributors are successful in bringing fledgling brands into small stores and independent retailers. As they grow, it is not uncommon for brands to graduate and transition from regional distributors and go to larger, national distributors to better serve their needs. For example, a larger distributor may have a wider delivery area.
Differences between large and small distributors
Be aware of the differences between working with big and small distributors. For example, regional distributors may only ask you to do promotions four times per year whereas large distributors may ask for more and also run up a lot of chargebacks. The big distributors often require running ads in their catalog and buy tables at their internal trade shows.
The trick to working with large distributors is to make up for it in volume. As order sizes increase and distributors make more money, you have more power to renegotiate your contract.
Next Article: Working with Distributors