Michael Adams Green Mountain Mustard and Gredio

Michael Adams, Owner
Green Mountain Mustard & Gredio

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10 Questions Retail Buyers Will Ask You

10 Questions Retail Buyers Will Ask You (and How to Answer Them)

Retail stores are one of the best ways to expand your distribution channel and grow your business. They provide for the right location at the right time for your customers to purchase your product. Plus, I’ve found a lot of people want to buy my products in-store – not online – because it’s local to them (and they don’t have to buy 6 jars of it to get free shipping).

The downside to having retail as part of your distribution strategy is, it’s complex.

There’s lots of numbers to deal with, people to call (get over your fear of the telephone), and well, your work isn’t done when you fill the purchase order. You’ve got to make your product sell so retailers re-order.

Today, I’ll tackle one aspect of the retail environment: answering the buyer’s questions.

I’m working on getting more retailers in the Boston-area right now – and that means lots of phone call follow-up. Sometimes I get their voicemail (which is another post in it’s own right), but other times I actually do get the buyer. And then they ask me interesting questions.

10 Questions Retail Buyers Will Ask You

1. What’s your story?

Story is everything in food. And you’ve got to have a compelling one. Did you lose your job and start selling granola? Do you have a family dumpling business? Or maybe you’re a young college graduate who’s dream is to own an ice cream company. Whatever it is, make your story shine.

How to answer: Keep it short. It’s not the most important part of the discussion. Write out five sentences in chronological order. Include a beginning, middle, and end – just like you did in third grade. Simple is better than complex. This is useful when customers ask, too.

2. What makes your product different from everything else on the shelf?

You can’t just make another BBQ sauce. There’s already 12-16 feet of them in the grocery store.  What makes yours different? Put another way: Why should I pull another brand off the shelf to put you there. To make shelf-space for your products, buyers often have to pull another brand off the shelf. Keep this in mind when you formulate an answer.

How to answer: Many products get differentiated by their health claims: sugar free, gluten free, non-gmo, etc. This may be enough for you to get shelf space, but it also might have to do with your company being local, your amazing food packaging, or unique flavor combinations. Think about this one. It may be the most important on the list.

3. What’s your goal?

I just got this one from a buyer. And while thinking on my feet paid off, he was pretty much asking “why would a small Vermont mustard company randomly send a retailer in Boston samples?” When you expand into other states, you’ll likely get this question to. But, it tells me retailers want to know why. The buyer said “Do you want to build a brand? Do you want to just sell more mustard?” I answered with this: ” I’m on a mission to show New England mustard doesn’t have to be bright yellow and it can in fact, be very flavorful. Plus, we do a lot of events in Boston and my customers always ask where they can buy it. I’d like to provide them with an answer.” Result: he liked it.

How to answer: Of course you want to say “SELL MORE! SELL MORE!” but that’s just not believable. Why did you start your business? And what problem would sending samples solve? Describe the situation, state the problem, and provide a solution. Here’s how my answer breaks down:

  • Situation: We sell at a lot of events in Boston, so we’re building a following
  • Problem: My loyal Boston fans have no where to buy our mustard
  • Solution: Your retail store is a great solution.

That’s my why. That’s my goal. And why I’m sending you samples. What’s your goal?

4. How do you distribute your product?

Buyers ask this to learn how they’ll get your product. If it’s not easy to order, they won’t. It’s as simple as that. But, if you’re available through four distributors and they use one of them, you’re a shoe-in. With that being said, maybe you don’t have a distributor. That’s fine. Many retailers still buy direct from hundreds of suppliers – and they’re happy to add one more.

How to answer: This one is pretty straight-forward. State all your delivery options (direct, distributor, private delivery service, producer coop, etc.). The buyer will likely show interest in one and want to compare prices – direct vs. distributor. More on that in question 10. If you have a minimum order amount, let them know that, too.

5. Do you do store demos?

You’ve got sell product. It simply can’t sit there on the shelf or you’re going to get swapped out for another brand the buyer believes will move off the shelf better. It’s happened to me before, and it’s not fun to find out about. Removing a store from our store locations list is like ripping a band aid off. It hurts. Because buyers are there to help you, they’ll often require store demos as a condition to taking your product.

How to answer: YES, YES, YES. You do store demos. Yes, you have time. Yes, you can find someone to do it if you’re busy. Demos are crucial to your product’s success. Even though I look at them as a necessary evil, you have to do them. Let the buyer know you’ll do one a quarter, one a month – whatever. They like to see that you (or your sales team) is involved in helping the retailer sell your product.

6. Where else do you sell your product?

Buyers want to know they won’t have a lot of competition – especially for specialty products that may not sell as fast as say, chips or beverages. They also want to know you’re committed to making a footprint in the area, which is nice if you already have a couple of retailers in the area. They may say “well, if Joe’s Market has your product, I want it to”.

How to answer: List area stores out, but state why you came into this store (remember question #3). If you’re not in a store near them, pitch the buyer the opportunity they have to be an exclusive (for the time being) retailer in their area. That’ll get them excited.

7. Do you have a sell sheet?

Sell sheets are just like magazine advertisements. They’re shiny. They have beautiful pictures. And they can get pretty expensive to print. But, they show professionalism. They provide all the info a buyer needs about your product, too.

How to answer: Yes, of course you do. Even if it’s made in Microsoft Word, sell sheets are important for buyers because business cards often get lost in the shuffle. (Have you seen a buyer’s desk – whoa.) If you need some help developing your sell sheet, here’s an article I wrote on what to include on your sell sheet.

8. What’s your promotional schedule?

What? I have to have promos? Well, they aren’t required, but they’re definitely encouraged. Retailers like Whole Foods Markets, requires a demo and promotional schedule (at least two times a year). But, think about what a promotion does: No, it doesn’t cheapen your product – don’t think about it that way. It simply encourages more purchases. And more purchases means you have the opportunity to create more raving fans. And that’s never a bad thing.

How to answer: Plan to put your product on promo (with larger retailers) a couple times a year. One of the best times is when you know you’ll sell a lot of product. For many condiment company’s it’s the summer. So if you normally move 10 cases a month, maybe you could move 30 if you run a promotion. Before you state your promotions, calculate if you’re still going to make money. When you’re small, you can’t afford to lose money on a promotion.

9. Do you do guaranteed sale?

Back when I owned a small energy bar company, I got this question with every single retailer (and it’s one of the reasons I got out of the short-shelf life business). Guaranteed sale (or buy-back) means the buyer has no skin in the game. If your product doesn’t sell after a certain time period, you buy it back. Here’s an example: you sell 24 muffins at $2.00 – $48 total. You come back next week and find you only sold 3 muffins. That means you buy-back 21 muffins at $2.00 a piece (likely out-of-date or moldy, too). A total of $42.00 – and you can’t sell the product to anyone else. You’ve made $6.00 – which quickly gets eaten up by transportation costs. Guaranteed sale is a nightmare.

How to answer: Well, if you’re new to the bakery scene or anything refrigerated, it’s smart to do in the beginning when you need to pick up traction with a couple retailers. Ultimately, you never want to do guaranteed sale. It’s just not a profitable way to grow your food business.

10. How much does your food product cost?

It almost always come down to price, it seems. That’s because price determines a lot of things: if the retail buyer will buy and if the customer will buy, too. Sometimes, $12 for jam is just too much. But, you’ve got to know your pricing. Get it memorized. Know if there is flexibility for bulk orders, too. If you nee help calculating your food product’s cost, I have tools to help calculate food product cost.

How to answer: Well, the truth is a good start. Be confident in your pricing. Let them know their unit cost through different distributors and direct. Plus, mentioned the MSRP (manufacturer’s suggested retail price). Again, it’s suggested. Retailers can mark it up to whatever they want – above or below the MSRP.

Retail is a great way to expand distribution of your food products, but you have to be prepared. Take some time to answer these questions and write them down. If you have a sales team, have a meeting to discuss these. It’s important to have everyone on the same page.

What questions have you gotten from retailers? Would you answer the questions differently? Add your comments below. And if you liked this post, feel free to subscribe to get new posts below. I send out an email every other Thursday at 7:45pm EST. No spammy-spam.

 

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18 Comments on this post

  1. AUTHORVeronica Molloy

    on March 5, 2014 at 8:13 pm - Reply

    Your 10 pointers were very informative and clear cut, a good package to have prepared.

    • AUTHORmichael

      on March 7, 2014 at 5:54 pm - Reply

      Thanks, Veronica! Glad you found the post helpful!

  2. AUTHORSusan

    on March 15, 2014 at 8:59 pm - Reply

    Thanks for all the valuable information. I was able to benefit from your post.

    • AUTHORmichael

      on March 20, 2014 at 12:19 am - Reply

      You’re welcome, Susan – glad it was helpful!

  3. AUTHORHelene

    on April 1, 2014 at 9:26 am - Reply

    I just start working on a new project and sincerely thank you so much for the precious information. It is really helpful and it encouraged me to try harder.

  4. AUTHORNancy

    on September 23, 2014 at 6:56 pm - Reply

    Thank you for your article! I am interested in getting my products into Home Goods and TJ Max. I am a fairly new business (and new at the marketing end) and am looking for a good format to present my product to the store’s buyers. I want to see my business take off! Any tips would be immensely appreciated!

    Nancy

    • AUTHORmichael

      on September 23, 2014 at 10:20 pm - Reply

      Hey Nancy — no problem! It’s applicable to really any industry! I’ve dealt with brokers who have HomeGoods and TJ Max as clients and they really push you on price — after all, they are a discount retailer, so be prepared for that. If it’s how you want to distribute your products, go for it.

      If you have an in with the buyers, ask them what they are looking for – what margins do they want? Do you have to pay for space? Is it guaranteed sale? How many units would the initial PO be?

      Hope this helps!

      Michael

  5. AUTHORNancy

    on September 23, 2014 at 7:01 pm - Reply

    So sorry, I just realized that this is strictly food related, however I appreciated what I got out of your post.

  6. AUTHORMarian

    on March 21, 2016 at 6:11 pm - Reply

    Hi Michael! I really enjoyed your post because I’ve met 3 shoe retailers for a product that never existed before. I have not signed any deal yet, although I’ve answered every question they asked. The product is authentic, it works, and solves a major problem that female shoe shoppers all have. I’ve always seen the interest, but why does the deal not close. I get the answering machines all the time after the meeting and I feel like the constant phone calling gives me a bad image. How can I spot an issue in my presentation and stop it from happening. I have changed the image of my company because I felt it was lacking that retail look and going back to all the retailers in hope to close one deal soon. I’ll also be filming for dragons den soon, and I’m working endlessly to bring a signed contract in front of the investors. Any feedback would help!

    • AUTHORmichael

      on March 24, 2016 at 9:39 am - Reply

      Hi Marian,

      Thanks for reading the blog. While, I’m no expert in the shoe biz (the blog is mainly focused on small to medium food businesses), the problem may be in the format of your presentation – taking a wild guess here. I would work your presentation into a situation, complication, solution – almost like a story, Then, your solution should be focused on the value you generate for the buyer, forecasting scenarios, etc. It’s hard to win a big retailer and you have to keep trying. I’d maybe ask for feedback at the end of the presentation if it’s an intro meeting, too. Best of luck with your pitches! — Michael

  7. AUTHORBravo M.

    on August 31, 2016 at 9:18 pm - Reply

    Hi Michael.
    Some great tips there. It does seem to me that once you get a sit down with a buyer you are in practically in the cat bird seat. Not a food business here, but a publishing house that has proven itself but is struggling to grow to higher returns. The problem I’m having and have not really seen as being addressed on blogs is the lack of courtesy response from gatekeepers/buyers. I can handle a hard “no” and can work with a soft “no”, but to be left hanging with a black hole response after repeated emails and phone calls fielded by assistants and level 2 gatekeepers is really frustrating. Can you share the story of hardest, longest nut that you really, really wanted and finally got a crack at and succeeded ? What was the tipping point? Thanks.

    • AUTHORmichael

      on September 1, 2016 at 7:54 pm - Reply

      Hi Bravo,

      While it is a different industry, the same still stands. The hardest deal to land for me was Bed, Bath, and Beyond. Ironically, we no longer do business with them. But, it took almost a year to land them. Started with a broker, probably 30 emails, four boxes of samples, an in-person meeting, two price drops, and an investment in EDI software to land them. It was so expensive to sell into them, we decided to pull our stock off the shelves at the end of last year.

      Keep on pushing. You’ll get there eventually!

      Michael

  8. AUTHOREddie Herrerias

    on October 13, 2016 at 4:24 pm - Reply

    Great post Michael!

    Been in sales for about 7 years dealing with retail buyers in two different industries. I was in the food industry for about 6 years and about to finish up a year in the nutraceutical industry in January. Honestly, when it comes to pitching to buyers its the same craft just different products. It can be done.

    Thinking of launching my own brand soon.

    Great job!

    • AUTHORmichael

      on October 14, 2016 at 10:51 pm - Reply

      True, Eddie! It’s the same exact process no matter what. Good luck selling everything.

      Michael

  9. AUTHORApril

    on November 24, 2016 at 5:54 am - Reply

    Hi Michael,

    We recently met with a store that wants to carry our product on a consignment basis. They are asking us for our wholesale price. This is be our first store and we’re not sure what the normal percentage split is with a food product on consignment. Do you have any idea how we should proceed?

    Thanks!

    • AUTHORmichael

      on November 30, 2016 at 11:58 pm - Reply

      Hi April — Usually a consignment store takes 30-40% — maybe even 50% in some cases. You could always negotiate, too!

  10. AUTHORBern C

    on March 1, 2017 at 11:34 pm - Reply

    Hi Michael,
    Thank you for the informative article. My client will be meeting with Bloomingdales in a few weeks and I found this at just the right time.
    Any advice about the “Guaranteed buy back” process for clothing/fashion, and how to address it?

    • AUTHORmichael

      on March 1, 2017 at 11:39 pm - Reply

      Hi Bern,

      Thank you for your comment! While I work in the CPG industry, I think the buy-back comes down to negotiation. How long is the buy-back term? What price is the buy-back at? Do you even need a buy-back (the ultimate win)? Go in expecting more and negotiate down – and don’t accept something that would make your client go belly-up just to land the sale. Hope that helps — good luck!

      — Michael

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