I Contacted 103 Independent Retailers. Here are the Results (Plus What I Learned)
One of the first things I learned after running several small food companies was success, albeit defined many different ways, was dependent on moving a lot of product. This meant I wasn’t going to make money moving a mere 30-40 cases a month at my local farmer’s market. I needed to move more.
That means selling more!
Sounds obvious, doesn’t it? But, it’s a lot harder than it looks. I mean, mustard doesn’t magically move out of my parent’s basement. I have to make it move (quite literally sometimes). I could do more farmer’s markets, find some private label accounts, get into more retailers, do more festivals, buy Facebook ads, etc.
For the past 3 months, I’ve been working on getting into more retail stores. Why? They order relatively frequently and when other revenue streams are dead, I’ve always got retail. Plus, distribution is king in the food industry.
As the son of an engineer, I’m super analytical and data-driven. I started this project with writing my process down (It helped to have experience in phone sales from my days working for a seller of accounting websites.).
My 5-Step Independent Retailer Process:
1. Acquire a list of retailers (lots of manual work here)
2. Research retailers to determine fit
3. Email to see if they’d like samples (more on what worked later)
4. Send samples
5. Create a follow up schedule and land that account (this was a series of phone calls and emails)
There are sub-processes for the 5 steps as well, but I won’t get into those here. With the process down, I started on the first row of my spreadsheet. They didn’t want any samples. (Oh, this was going swell). As I worked down the list, I was getting sample requests left and right – mostly over email. Fast forward to the results of my experiment.
- Retailers contacted: 103 (by phone and email)
- Samples requested: 34 (33.01% of retailers)
- Orders placed: 10 (9.71% of retailers)
It was an interesting experiment. For the countless hours of work I (and ultimately a part-time sales guy) poured into this, I had $928 in sales to show for it — not profit. When I took the costs out, I ended up with about $200 in my pocket. But, it wasn’t so much the profit as it was the process.
I think there’s more there. This number could be improved.
What I Learned:
1. A Strict Follow Up Schedule Has to Be Created (and Stuck to)
I lost track of everyone I was talking to. I had no idea who I had been contacted, who got their samples, did they get a phone call or an email. And then days later, they’d fall right back off my radar. To start, I had a phone call/email back-and-forth going on. It worked when I was dealing with a couple retailers, but as the project expanded, it got out of control. I installed Streak CRM in my gmail which helps with the leads pipeline as well as follow-up reminders. The trouble? I’d literally forget to use it. Now, I have a process written down. All that’s left is forming a follow up habit.
2. The Best Email Strategy Shows Customers Want to Buy Your Product
I was on my last handful of retailers two weeks ago. I send out 15 emails and got 10 sample requests back. What worked so well? I used something like “Hey ____, We’ve heard from a lot of our current customers that _______ would be a great place to carry our _____. Could I send you some samples? Who should I send them to?” I used a couple different variations, but playing the “customer card” worked well, even if it might have been a stretch of the truth. Bottom line: it got my product in the buyer’s mouth. Oh, and you have the buyer’s name – gold mine!
3. I Have to Spend My Time Courting Bigger Accounts
As you may have seen above, I hired a commissioned sales guy to help me sell into all of these independent retailers. I continue to give him leads on a weekly basis. There are hundreds. He calls/emails and works with me to create a process that works with both of us. When I was sending out 8-10 samples a week, I noticed how much I wasn’t doing to build my business. Now, I have a little bit more time to work on large-account sales. Still up to my neck in work (aren’t we all), but trying to get dedicated time to work on my business. Not in it. Wish me luck!
4. It can get expensive
Here’s what I send every person who requests samples: 3 full-size jars (buyers want to see what the product looks like on the shelf), a sell sheet, a price sheet, a postcard promoting our cookbook, and a hand-written note to the buyer (a simple index card and sharpie – authentic right there!). The jars are individually-wrapped and packing peanuts fill space. Thankfully, the box is free (shout-out to the USPS). All said and done, the sample kit costs me $12 to send (on average). To put that in perspective, the 34 samples I sent out above cost me $408 — almost 50% of my generated sales. But, keep in mind, I’ll make my money back on the repeat orders. If you have the sampling budget, it’s worth the investment.
5. Never give up
During this time, I attended the Vermont Grocer’s Association Annual Meeting (always a fun time catching up with fellow food producers). At the meeting, I listened to a panel on trade-shows and the importance of following up with leads. One of the panelists was Kieth, the former owner of Westminster Crackers. He let the crowd know about this follow up technique (which was a folder for every day of the month), but more importantly he stressed the importance of following up until you get a no from the buyer or a “I never want to hear from you again!” And even if you get a “no” it’s still not firm. Buyer’s change, store’s needs change. You never know. I’ve been working on some of the leads from the big list for months now. I’ll get them to order eventually!
Overall, I enjoyed this experiment. I’m going to keep doing it because at the very least it gets my product out there into people’s mouths who haven’t tried it before. Now it’s your turn! What have you done to grow your food business this year? Are you going the independent retailer route? Let me know!
20 Comments on this post
on June 20, 2014 at 4:06 am -
Great post. I’m curious as to how you found a good (would you consider them good?) commissioned sales guy? Did they have industry experience?
on June 20, 2014 at 7:18 pm -
My sales guy is a recent college graduate who is looking for opportunities. He doesn’t work full-time for me, but he works with a lot of our independent accounts as well as does events for us on the weekends. Found him on Craigslist actually.
on June 20, 2014 at 4:33 am -
We recently learned that Tennesee is changing one of their laws. The change will allow liquor & wine stores to carry food products that can be paired with liquor or wine. We sell seasoned pretzels so that is a great fit for us.
I googled “Nashville liquor store” and compiled a list of 15 stores. I emailed each of them asking if they would like a sample of our pretzels. Two responded that they would like samples (13%) so we sent them off. We followed up about 10 days later and both of them loved the pretzels! Each store said they want to order pretzels but need to wait until July 1st to do so as that is when the new law goes into effect. I plan to email them on 7/2 if I haven’t heard from them yet.
on June 20, 2014 at 7:19 pm -
Great work, man! Sounds like you’re onto something. Now to dominate the Nashville liquor market! I have friends who own a spiced pretzel company and they’re doing great! Best of luck to yoU!
on June 24, 2014 at 4:43 am -
Thanks! Are you friends with Distler’s? I just found out about them 3 weeks ago. They have a great story!
on June 24, 2014 at 12:39 pm -
Haha, yep! Great friends and a cool business they’ve got going on!
on June 20, 2014 at 5:39 pm -
I’ve written you before…
My question is: If you’re in the putting-it-all-together stage, or pre launch, how do you find the right ingredient vendors that the quality and the price we’re looking for? Do you call everyone in the book? Do you ask for samples of everything including butter?
Also, I have a product that requires multiple vendors, as some vendors I’m finding don’t carry everything you need.
How do you settle on them?
on June 20, 2014 at 7:21 pm -
Ingredients are pretty wild. I use about 10 different suppliers and I’m constantly searching for new ones. I do request samples of ingredients that are integral to my product. For example, all mustard powder is not made the same. I can’t just “switch over”. I google like mad, call food service distributors, and get ingredient suppliers from other manufacturers.
And as always, if they treat you well, stick with ’em! Does that help?
on June 23, 2014 at 9:53 pm -
What is the best way to get a list of retailers to contact?
on June 24, 2014 at 12:44 pm -
What I ended up doing is manually collecting store lists from other companies whose products I thought were aimed at my target market, near the same price, etc. As I found them, I put the information into a Google Doc and started emailing/calling. PS: I’ll get to your email in a second!
on September 14, 2014 at 12:18 am -
Thanks for sharing what you’ve learned. Very helpful.
When you emailed and called the retailers, which contacts did you go for (if you couldn’t find the buyer’s info)? How did you find those contacts?
on September 14, 2014 at 10:46 am -
Hi Yat – I typically go for the grocery buyer (or assistant buyer to influence the decision maker). If they aren’t available, I’ll ask the employee who answered the phone who the buyer is and then how I can get samples in their hands. Does that help?
on January 21, 2015 at 3:28 am -
I love this post because I’m at that stage of making a list of retailers to approach. My product is a Jamaican coconut candy called Coconut Drops made from fresh coconut, and most people do not know what it is. So it is really difficult to get their attention when they’ve never hear of such a product Thanks for sharing your ideas.
on January 21, 2015 at 3:18 pm -
You’re welcome, Denise. Glad it was helpful. I wrote this post more for my personal reflection and it turned out to be a great resource for a lot of people. I’ll be doing more analysis going forward.
on September 11, 2015 at 3:00 am -
Great article. I am thinking of hiring a commissioned sales person to help me out as well. Do you mind if I ask you what your commission structure is for your person? We would want to base commission on profit, not just gross sales. Wondering if percentage you give, do you pay for mileage, etc.
on September 11, 2015 at 10:20 am -
When I hired a salesperson, I paid him by the hour for his travel time, and then a 20% commission on sales. The commission is high, but I didn’t pay for gas or hourly in general.
In hindsight, if I were to do it again, I’d likely pay a monthly base of $1,000 and then a 5-8% commission on top of that.
Ultimately, it depends on your margins and the money you have to invest in your business.
on January 8, 2016 at 7:16 pm -
Your site is fantastic. Thank you for sharing your insights.
The food industry is so multi-layered and you have shared every aspect. Really grateful!!
I just started Relish the love with our first eggplant Relish. We are selling online and now getting to stores.I am currently making the relish in a commercial kitchen myself and
am currently looking for a co-packer. Most co-packers I spoke to don’t want to use fresh ingredients (eggplant). Any thoughts?
on February 10, 2016 at 12:05 pm -
Thanks so much for reading! As a co-packer myself, using fresh produce isn’t exactly a bad thing. It just means a lot of refrigerated storage and processing. Versus using IQF (frozen) eggplant — much easier, quicker, and cheaper for you. Where are you located? I may be able to help you out with production — email me at firstname.lastname@example.org
on February 18, 2016 at 3:47 am -
Thank you for all that you share. I love how you share your experiences on the good, the bad and the ugly of what it’s been like for you. It’s so nice and even though there is plenty more to do than I have time to do these days it was so relaxing and great stress relief just to know somebody gets it. Food business definitely has it’s ups and downs. I call it my roller coaster ride as it’s what it often reminds me of. Thank you for all that you’re doing to help the rest of us, it’s appreciated!
on February 22, 2016 at 1:58 pm -
Hey Tina — It’s definitely a roller coaster ride – no doubt about that! I’m so glad you got value from the blog posts I’ve written. Best of luck with your food business! — Michael