Creating Enough Retail Opportunities So You Can Choose
I once got confronted by a Phase 2 founder with a great (but perhaps not wildly memorable) product that was chasing a not that interesting outcome in his category. Word-of-mouth was weak because a ‘great-tasting’ X isn’t culturally interesting in some categories.
“James, I take any retail account I can get. I don’t see how anyone can afford to have a strategy. That assumes you can pick and choose. I’ve never had that option.”
Here’s the insight this founder didn’t know that I gleaned years later from more senior CPG sales pros.
You should always be warming up far more retail accounts than you can actually service or even want to service…right now.
Now, you’re not actively asking for shelf space in these conversations. You’re simply introducing yourself, flattering them a bit, and sharing your future interest when the timing is right.
In the old days, you could trail out a litany of holiday gifts in advance as you dated buyers. This is against company policy at most chains now and certainly at publicly traded ones.
So, you’ll have to get more creative in updating them and building an ethical relationship well in advance of your ask.
The point of doing this is to have MORE options than you can fulfill every year at some point. This allows you to be somewhat selective about going where premium buyers shop in great density.
However, EDLP chains or those with heavy rural store bias usually burn through CPG ‘startups’ that rarely have the awareness or SRP pricing to generate substantial velocity, let alone velocity growth. They know this. They’re interested in the flow of onboarding fees from suppliers, OR they simply become used to those fees as their chain continues to fail to sell them well.
The key to having ‘choice’ in retailers is to warm them up well in advance, just like you would with investors. Be like the chill founder in this photo. He’s not stressed about pitching for shelf space right off the bat. The unprepared become desperate, come in pitching wildly, and wind up with a view of the world they have no control over. Ouch.