Approaching retail stores to stock your products....

I've done this to some degree before. In late 2000, my brother started a blank CD-ROM distribution company, and I was helping out - part of that was approaching small stores to stock the blank CD-ROMs.

It wasn't hard to do - if they feel they could make a profit without too much risk, then of course stores are usually happy to stock your stuff. The "gimmick" of the blank CD-ROMs we were distributing was that they came in many different colors.... My brother knew the people who set up the company to import these.

Anyhow, to make a long story short, the business wasn't a success. The colored CD-ROMs turned out to not be of the best quality for "burning" and seemed to have a lot of errors, even though they looked pretty snazzy. (We didn't have a CD-burner at the time to test them ourselves, and we mistakenly took the word of the importers about their quality.) The other CDs we were distributing were good, but there was really nothing to distinguish those CD-ROMs. Also, distributing CD-ROMs has pretty small margins - the margins are as small as 5% to 10%.

However, I did get some experience in approaching stores to stock a new product. We only approached small stores, though, since another distributor already had the rights to distribute to the large chain stores.

Having said that, does anyone have tips on getting your product in the stores? Our approach was to simply go to these small stores, and talk to the guy at the counter. In most cases, he was also the store owner, and we'd demonstrate the product, give a spiel about it's benefits, and let him stock it on a trial basis (he only paid for what he sold).

Has anyone done this? I'm also especially interested in any experience in approaching chain stores too....

If you have the ability to get products in the stores, there are a lot of little "product developers" around who you might be able to work with, to distribute their products. I think this could be a very lucrative business to get into.

- Dien Rice


Distribution is also another example of using Leverage....

Approaching the store owner directly, like you did, is the way to do it for the types of stores you were targeting.

Some other stores, like certain chain stores, will also take on a product under a similar situation - consignment. And will often deal with "distributors."

If you have a Pet Product, for instance, you can approach the pet shops directly and do what you have done. Or, you can call the supplier of any non-competitive product and ask who the distributor is (the pet industry in Australia only has two major distributors who handle just about all pet products), or ask the pet store owner who the distributor is. Then contact the distributor and ask them to handle your product.

Want a publication in the newsagent stores... same thing - approach each agency directly or contact a distributor (ask the agents - some distributors are small and can be known to be unreliable if your publication doesn't sell in large volume).

Frozen foods... same thing.

Either way, the distributors may want the product to already have proven sales within an area, or at least accompanying marketing materials. It all depends on WHO the distributor is and what the product is. And they will want you to supply them with plenty of stuff to distribute - although, in the beginning, they'll most likely use a sample to generate sales, or leave some behind with the store owner for testing. (One distributor I know will stock your goods in their warehouse and want proven sales and proven marketing materials before even looking at your product. And after that, you pay them for doing the distributing. But they have the established network so it worth whatever they charge to use them leverage your sales.)

If you are thinking along the lines of Department stores... you have to call them on the phone and ask to speak to their buying department of the type of product you want them to stock. Then ask them for their Guidelines. Each department has different guidelines and procedures for submitting products for their consideration.

And they will mostly want exclusivity.

So if you have found a product, try and get an exclusive before approaching a major department store. This protects you if they do research to find who your source is.

Even after following their guidelines, there is no guarantee they will stock your product.

And just because they don't want it at the moment doesn't mean they won't want it in six month's time, or a year later. Fashion, tastes, and what people want change all the time. What is not hot may be hot this time next year. Unless you keep submitting your product the buyer will forget about you.

The buyers are quite friendly and they encourage you to send stuff their way (at least in my experience dealing with them). Makes their job easier, I suppose.

Michael Ross


Learn more about using Leverage

Hi Michael,

Thanks for your reply - gosh, you sure seem to know your stuff regarding this. :)

I'm actually still interested in the physical product distribution biz, though I'm not doing it at the moment.... However, it's certainly something which is good to know the ins and outs of - even if it's just to get your own product distributed.

I personally DO like the idea of finding small "product developers"... They could be making their own little toys, their own soaps, there could be many possibilities. You might find them at craft shows, or a trade shows, in the classifed ads, or at a market somewhere. Do a deal with them to market their product (get an exclusive, as you say, Michael). Then, get their products in the chain stores (or at least do your "darnedest" to get them there!).

This is a formula which I know at least one person has made work BIG time - Harvey Brody. Gordon Alexander wrote about him in a post earlier this year.... Harvey Brody himself learned a lot of it from Joe Cossman, who did it to some extent as well. So I know the "formula" works. :)

Thanks Michael - incredible info. You sure know your stuff. :)

- Dien Rice