After developing a line of products and figuring out how to manufacture them, you need to turn your attention to how you are going to sell them.
Too many manufacturers look at the selling of their product as a secondary goal. They put their heart and soul into their product that they deeply believe in and expect it to sell itself. Well-entrenched competitors develop systems to keep out new entrants. Typically, you might have to find a wholesaler who might use a distributor to get the product into retail. Then, to get shelf space, you may have to pay a slotting fee or marketing development funds. You have to shell out the money before any sales are made, and it may take many months to get paid.
Not only does traditional retail reduce your margins and drain your cash flow, but it increases your working capital requirements and distances you from your target customers.
Think about trying out multiple distribution channels for your product, including direct sales online, as you get started. Once you build a reputation and customer base, it will be easier to attract distributors eager to represent your product line. Direct sales are less costly and will help you find your target customer while you test the marketplace.
Set up a Facebook page and Twitter account for your products, if you don’t already have them, and invest time in social media marketing, perhaps using Pinterest and Instagram. You have to put at least an hour a day into it, every single day, creating and scheduling tweets and entries, though there are apps to help you manage this process across multiple platforms, such as Hootsuite and Buffer.
You should also contact bloggers and people who post videos about your types of products and offer to send them free samples in return for reviews. When you are ready to approach retailers and reputable distributors, be careful, as there are hundreds of predators and very few people who actually pay for themselves.
Once you contract with some reps, have them sign licensing agreements that stipulate your expectations and present guidelines about how returns will be handled and how much inventory the salesperson will purchase each quarter. There is no shortage of unscrupulous people who can walk away with your product, sell it, but not return the correct proceeds to you or ruin your reputation by scamming customers.
But there are also good brokers who will work hard to make your products successful. You have the leverage of being able to develop a commission program that encourages the broker to find the right distributors and reap the rewards when your product is sold and revenue is received.
If you would like to discuss how we can support your organisation to expand overseas, please contact us here or speak to Shelley or Stuart on +44 (0)121 214 6204.