In the previous three posts we have given just a few examples of the importance of Channel Distribution Management in product design. Here we will examine two of the most important factors in product distribution through conventional channels:
14. Stack it! It is great to get your product on the retail shelf, but getting it stacked on the floor is infinitely more valuable. When your product or brand is new, there is no better way to announce its arrival than a colorful floor display. Floor displays are at the option of the retailer, but retailers are more likely to grant you the coveted floor space if they believe they can move your product quickly. This may require special pricing, local promotion, merchandising assistance, special signage, and months of preparation and scheduling. Retailers want to floor display products that have a demonstrated record of brisk sales, a real Catch 22 for new producers with no track record. However, a strategic plan that starts small and demonstrates brisk sales with adjacent retailers will give you and your product credibility.
15. Reorders are more important than orders! Without the reorder, all your work to get your product to the retailer is lost. This is why eternal vigilance at the retail level is essential. There are many reasons why retailers don’t reorder besides the obvious, “The price was too high,” or “The quality was too low.” Here are some examples:
- Your product sold out and the retailer forgot to reorder because he was not used to reordering it.
- The retailer’s distributer that supplies your product did not deliver.
- The distributer delivered the wrong product.
- The distributer’s sales person loaded the retailer up last month with products that have yet to sell and now the retailer doesn’t want to order anything from that sales person, including your product.
- Your product is still in the back room and never made it to the shelf.
- The invoice was wrong and the price was wrong.
- Your distributer’s sales person simply did not ask for a reorder.
- Your products UPC number was incorrectly entered at the back door and was refused.
- Your product UPC number was incorrectly entered on the scanner at the check out.
- Your product’s shelf reorder ticket was lost or removed.
- None of your Point of Sale signage was up.
If you don’t have your own representative in that city, visiting that store on a regular basis, your product could be easily discontinued for any of the reasons above, and more. And everyone will tell you, “It just didn’t sell”.
There are many more distribution factors to consider before launching any product. The most successful products treat distribution as more important than the product itself.
In most chain stores, you get only one chance…forever! The good news is that your product can’t be discontinued if it isn’t there yet. Do your research. Start small and slow.
There are warehouses full of great products that never made it to the shelf. There are shelves full of many products that are less than great … but they have great distribution. Customers buy what’s there, and they can’t buy what isn’t.
Your product is only new once. So take the time to build the distribution requirements into your product and your budget. Hit a home run at your first and only time at bat!
Who We Are
Michael Houlihan and Bonnie Harvey co-authored the New York Times bestselling business book, The Barefoot Spirit: How Hardship, Hustle, and Heart Built America’s #1 Wine Brand. The book has been selected as recommended reading in the CEO Library for CEO Forum, the C-Suite Book Club, and numerous university classes on business and entrepreneurship. It chronicles their humble beginnings from the laundry room of a rented Sonoma County farmhouse to the board room of E&J Gallo, who ultimately acquired their brand and engaged them as brand consultants. Barefoot is now the world’s largest wine brand.
Beginning with virtually no money and no wine industry experience, they employed innovative ideas to overcome obstacles, create new markets and forge strategic alliances. They pioneered Worthy Cause Marketing and performance-based compensation. They built an internationally bestselling brand and received their industry’s “Hot Brand” award for several consecutive years.
They offer their Guiding Principles for Success (GPS) to help entrepreneurs become successful. Their book, The Entrepreneurial Culture: 23 Ways To Engage and Empower Your People, helps corporations maximize the value of their human resources.
Currently they travel the world leading workshops, trainings, & keynoting at business schools, corporations, conferences. They are regular media guests and contributors to international publications and professional journals. They are C-Suite Network Advisors & Contributing Editors. Visit their popular brand building site at www.consumerbrandbuilders.com.
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