Your company is doing great. Your Amazon account is thriving and you’re launching new products to your customer base.
But as a smart business owner, you know the importance of diversifying your sales channels to build a more robust business.
So, what’s next? How do you even begin to think about online retail?
It's easy to feel overwhelmed at the prospect of it but if you're careful and you do your homework, online retail expansion is one of the best ways to take your business to the next level.
Not sure if you’re ready to grow your e-commerce brand globally? Here are 8 signs that you and your brand are retail-ready!
If you want to boost your sales and increase your success as an eCommerce seller, you need to sell to online retailers.
But how do you convince them to carry your product?
Show that you have a proven record of strong sales. This will help instill their confidence in listing your products on their site.
To do this, you need to make it easy for online retailers to find you on different marketplaces. Put yourself in the shoes of the retailer and go to Amazon.
Does your product have thousands of positive reviews? Do you have consistently strong sales for the last few months?
All of these can help demonstrate strong proof that people are willing to buy your products.
Online retailers need to understand what your product brings to the table and why your consumers are more inclined to purchase them compared to your competitors.
Is your product differentiated by price, quality, ingredients, manufacturing? Maybe your product catalog is larger than your competitors.
Whatever your angle maybe, building a story around why your brand/product is different is absolutely necessary for a good pitch.
The marketplace is becoming very saturated with me-too products, by doing this you’ll increase your probability of landing your dream retailers.
Need help coming up with a brand pitch? Contact us here.
Another must to get your products on retail websites is to offer a good sales margin.
Ever heard of Keystone markup?
Keystone markup means the retailer is going to make a 50% margin on every sale. They buy from you for $10 and sell for $20. You buy it for $5 and sell it for $10.
Everyone is doubling their money.
We like to operate tiered pricing for our clients which is based on order volume. This pushes retailers into larger orders and allows you to be more efficient in your shipping/logistics.
This helps build a good story on why they should be doing business with you instead of your competitors.
It’s important to make sure you are profitable when you work on your pricing strategy. You have to account for the different fees on the retailer side as well as your marketing expense in driving traffic to their website.
How many days will it take for you to deliver a PO?
Can you deliver a PO from the date the order is placed, to shipped in 10-14 business days? Or will it take you 30+ days to ship?
This is where having your own warehouse gives you a big leg up compared to working with 3PLS.
Having your own warehouse allows you more control over how you ship out retail orders. Since each retailer has different shipping specifications called routing guides this gives you more flexibility which in turn decreases cost, especially when it comes to creating case packs.
If you’re using 3PLS this can be complicated as they tend to be expensive and inflexible when it comes to pick-and-pack situations.
Pro tip: If you feel that retail is something that you want to invest in, start ordering your products in 12-24 unit case packs. This will decrease your cost if you’re using a 3PL or your own warehouse.
The UPC (Universal Product Codes) is a number assigned to your products that uniquely identify them.
Getting your UPCs early is a smart thing to do for several reasons:
A lot of Amazon sellers start by buying random UPC codes or using the FNSKU directly on the product box.
This works if you want to stay on Amazon but as you move into retail you will need product UPCs, and they should come from GS1 US which is the official UPC registry service. GS1 US is a standards organization that creates globally recognized, unique identifiers for products and other assets.
UPCs are 12-digit identifiers that can be used to track any product. Every product sold in a retail environment will have a UPC assigned to it, and all those UPCs are registered with GS1 US.
Having your own GS1 prefix can be costly but if your brand is gaining momentum you’ll have to deal with packaging changes at a later date, which is also costly and extremely time-consuming.
Looping in graphic designers, approvals, packaging printers, and supply chain. Trying to deplete old packaging and then start with new. Recreating listing images and reuploading. Then managing the project!
Start with UPCs if you can.
Take a step back and consider your capacity to scale.
Does your team have enough bandwidth to manage a new channel? Creating a new online retail channel would need sales, inventory control, orders processing, copywriting, graphic design, and customer service.
On top of that, you need to consider the time it will take to set up and maintain a new channel. If you're offering a variety of products, providing the retailer with product information files, images, and compliance information can be time-consuming. They also expect it to be done in a timely manner.
Taking on too much at once may cause your existing business channels to suffer so if you don’t have enough people on the team, you have to start sourcing people that will help support your growth. Outsourcing overseas has been a blessing for our business and it can work for you too.
Need help finding rockstar VA’s? Talk to us here.
Having a strong social media presence will help online retailers decide if they want to carry your brand.
Put yourself in the shoes of the buyer and go to Google.
Do you see your brand in Google shopping? Do you have a beautiful website? Does your Amazon link pop up and show thousands of positive reviews?
When they look for you on Instagram and Facebook, will they be able to see an active account with regular daily posting, active engagement, and a strong following?
Do you have awesome product imagery?
Some retailers may be hesitant to invest in a brand that doesn't have these qualities because they don't see how you will drive customers to their website.
When you're selling products online, social media is your best friend. It's a free and easy way to reach potential customers, establish your brand voice and build relationships with people who matter.
A strong social media presence can also drive traffic to your website or marketplace listing and boost sales — which brings us to our last point:
It’s easy to think that once you’ve convinced a retailer to bring your product in, the hard work is over and you can sit back and watch the profits roll in. This is simply not the case.
The biggest hurdle to getting more sales is simply making potential buyers aware of your listing on the retailer's website.
You must have different ways to drive traffic to your product whether it's paid ads, email marketing, launching a social media campaign, working with influencers, or soliciting product feedback.
As always rankings and product feedback are kings.
There's a lot of work to do before you can approach retailers with a product offering that makes sense for them. They can have their own distinct language and it can be complicated (for outsiders) processes. You can expect long sales cycles (4-24 months), and once they accept you as a vendor, onboarding may take another 2-6 months before your products are on shelves.
But in that lies your opportunity.
Retail is a long-term diversification strategy that can add substantial revenue if given the time and resources to grow.
We’d love to help you diversify your business into retail. Let’s chat about your opportunities —> Chat here.
