Small to medium-sized enterprises (SMEs) that make their own products understand the importance of customer reach beyond their own stores. Making your own products can be costly, and factor in the marketing and other operational costs, SMEs need to find ways to get their products onto bigger retailer shelves.
What are Retail Stores?
A retail store is a physical or virtual business that sells products or services directly to consumers for personal use rather than for resale, often in small quantities. These stores function as intermediaries between producers and users, offering goods through various channels like shops, websites, or supermarkets.
Getting your products onto retail shelves is an important aspect of SME growth. These opportunities create access to larger markets, an increase in sales and profits and improved cash flow.
In this article, we look at the advantages of being on retail shelves, how to pitch for these opportunities and the different supplier initiatives available in South Africa.
Advantages of Being on Retail Shelves for SMEs
Securing space on the shelves of large retailers offers critical advantages for SMEs, ranging from increased sales to enhanced brand visibility. Key benefits include:
- Brand Exposure: Being on large retailer shelves provides immediate visibility to thousands of daily shoppers for SMEs, which is often more effective and less costly than traditional and digital advertising for building brand recognition
- Better Credibility and Trust: Retailers act as a “vetting” mechanism; customers often perceive products in major stores as being of higher quality and reliability compared to unknown online-only brands
- Increased Sales: The high foot traffic in large stores drives impulse purchases, which can lead to increased sales for SME products
- Operational Efficiency: Relying on a large retailer’s established distribution network can reduce an SME’s logistics and delivery costs through economies of scale
- Decreased Overhead Costs: If you rent shelf space within a large retailer, it’s significantly more affordable than renting and managing an entire standalone storefront
- Data-driven insights: Partnering with a major retailer often grants SMEs access to sales data and customer feedback which can help refine marketing strategies and product development
- Market Defensive Advantage: Occupying physical shelf space prevents competitors from taking that same “share of shelf,” making it harder for rivals to capture the customer’s attention
Tips on Getting your Products on Retail Shelves
Before you apply or approach retailers for shelf space, your business must be compliant, especially SMEs operating in the food industry. Here are some tips to help you successfully get on retail shelves.
Tip 1: Identify the Retailers
The first step is identifying which retailers or, in some cases, e-commerce platforms are serving your target market. You need to understand their seller programme, product preferences, purchasing cycle, pricing requirements as well as the costs of being part of the platform or shelf.
Examples of seller programmes:
Shoprite seller programme
Takealot seller programme
Other e-commerce seller programmes
Tip 2: Develop your Pitch Deck and Presentation
Once you have identified which platforms or stores you want to place your products on, you need to develop your pitch. In some cases, speaking directly to the management team about your product, its features and why their customers need it is better. In the digital world, most large retailers have seller programmes that you can apply for.
The process of pitching is an exercise in patience and refining. This procedure is not about instant gratification but rather about relationship-building and making sure your product is ready for shelves.
Tip 3: Pitch the Entire Business
When you present your products to the potential buyer, you need to focus on selling your entire brand, not just one product. You need them to understand your business, which customer pain point it solves for customers and make them believe in the longevity of the product.
Also, be ready to answer tough questions and receive feedback positively even if it’s not what you want to hear.
Tip 4: Pitch to the Right Person
Unlike seller programmes which usually have online applications, pitching directly to a retailer means you have to talk to the right person. Find out who “the man” or “the woman” is. This is the person who has the authority to buy – or to decline to buy – the product you wish to sell.
Essential Data Points for Pitching to Retailers
In such a competitive product environment having quantifiable proof will always be more convincing than just asking a retailer to take a risk on your business. Here are four must-have metrics for an effective retail pitch.
1. What is Driving Category Growth in Each Channel?
Retailers want to know that your audience matches their audience. The best way to prove this is by showing what shoppers in your business are after. Analyse the channel where your product is being sold or will sell and identify which products are driving growth. If your product is already showing growth momentum or is resonating strongly with natural and organic shoppers, whether online or in storefronts, let retailers see those figures.
2. How Does your Product Perform?
Build on the strength of your category growth data by adding figures for distribution and velocity. If your product is already on the market, break down where your product is sold online and offline, how many units your product is moving and at what rate. This will not only help retailers understand the importance of your product but also your pricing strategy.
3. How are you Performing Versus Competition Within the Category?
Once you have demonstrated how well your product units are selling and which channels are used for distribution, you need to show your competitive edge. Use the same metrics (velocity and product) for a comprehensive competitor analysis, emphasising how you are outperforming them or gaining ground.
It’s always a good idea to conduct your comparative analysis before the pitch to see who your competition is and prove that you have built your business strategy on marketplace data.
4. How is your Product Aligned with Attributes that have Growth Potential?
This metric is the most important because it ties together all your data and highlights your product’s strengths. Product attributes such as gluten free or vegan or void of artificial colours are a critical part of the consumer’s purchasing process. You need to be able to explain to potential buyers how your product influences the consumer buying process.
Getting your products on retail shelves is a big boost for any business, in any industry. Use the above tips to refine your pitch deck and identify the best aligned opportunities for your business.
Small to medium-sized enterprises (SMEs) that make their own products understand the importance of customer reach beyond their own stores. Making your own products can… Read More
