Ten Steps To Wholesale Success
6. Retail Environment
Retail markets are becoming more intertwined as niche markets pop up and retailers are trying to accommodate consumers with multiple demands, as well as trying to maximise their sales per square metre. Knowing how to fit within these markets can be a challenge. “What is relevant to us is having a meaningful position in the marketplace when the world is getting smaller and all of the business segments are becoming more and more blurred,” says Lambert. “Fashion stores are putting in sports brands and sports stores are putting in a bit of surf and a bit of street.”
This can make it harder for any wholesaler and distributor to enter, he says. “So for us, we’ve got to decide what we stand for and ensure we’re damn good at it, then convince customers of it and deliver to it. That’s our biggest challenge.”
For Schwartz, this changing retail environment can also mean more opportunities for some wholesalers, such as those in the gift and homewares industry. “Nurseries used to be the sellers of fresh plants, but now with issues like the drought they’ve had to look at different retail streams. Certainly now the cafes, and gift and homeware stores, are flourishing within nurseries.”
7. Margin Trading
Margins are a big part in wholesaling, and this can be crucial in getting your products into the retailer. Schwartz admits the rising costs of freight and other business expenses means there’s always pressure on finding products which offer both consumer appeal and deliver a good margin.
Glass agrees: “You need to be conscious of what margin your average retailer needs to make
and you need to be offering them a better than average margin if you’re a fringe brand.”
8. Wholesaler Industry Help
While there’s no broad assistance available for wholesalers in general, individual industry associations can be a great help. “You’re mad not to be involved for at least the information they provide,” says Lambert, a member of the Australian Sporting Goods Association (ASGA). “The ASGA provides the only industry stats, and so you’re crazy not to subscribe and get that information.” With ASGA providing publications on various issues relevant to the industry, such as counterfeiting, it is helpful to stay abreast of industry trends.
Schwartz, a member of Gift and Homewares Australia (GHA), agrees, and says GHA offers business partnerships in areas such as freight, insurance and telecommunications, which can help members keep costs down.
And the web is a limitless source of inspiration and guidance, says Lambert, especially in researching what is happening in your industry and in others. “There are just so many different avenues for inspiration that you need to tap into.”
9. Trade Shows
Trade shows can also offer great opportunities for wholesalers, and Lambert says they can vary in relevance depending on the industry. “If you’re a start-up business in an industry where the trade fair model is important, then, absolutely, you must be there,” he says. “If you’re small or a start-up, then it probably makes sense as one of the elements of your marketing mix to be there.”
Schwartz attends three trade shows a year, and says they are instrumental in the growth of his business.
10. Sales Strategy
Covering your market and getting into newer ones requires staying on top of trends in your industry and making sure you have a point of difference. “If you’re a smaller business you certainly need to think about what you bring to the table,” says Lambert. “Be it a new technology or a new look, or a higher margin, or that sort of thing; you need to bring a meaningful commercial argument.”
Using your advertising or promotions in a way that helps increase customer traffic can be a big help in persuading retailers to take your products, he adds, rather than just saying your product will convince current customers to switch brands. “The more you can actually say ‘I’ll bring people to your door through my marketing and investing in the consumer’, then that’s a good case as well.”
This can play a big part in your overall game-plan. “Understand who you are and where you sit in the game,” he says. “Then, with a great sales strategy and approach, you’re away—simple really!”