What makes wholesale with department stores successful?
So the buzz is building about your brand and you've been approached by major retailers interested in stocking your brand - great! The wholesale arena can not only dramatically increase sales but when your brand is picked up by the right stores, it can also be key in making you a household name. Read below for what needs to be in place to ensure long-term success with your largest retailers:
WHOLESALE STRATEGY
Your product may only get one shot to perform well within department stores. It might sound obvious but the first step to a successful wholesale business is a clear wholesale strategy.
It's important to have a plan on topics such as:
What your wholesale product assortment looks like
How your pricing is structured
Wholesale partners and external support to have on your team as you grow
A strong idea on how the brand will be merchandised in stores
How you'll be managing inventory
Who will manage the full sales / market cycle?
The more structure you have in place when you first set out to grow your wholesale channels the easier it will be to scale.
NEGOTIATION SKILLS
When dealing with some of the industry’s biggest players, strong negotiation skills are essential. Difficult conversations are never easy but sometimes necessary in order to get the best representation for you and your brand.
It's important to take into account your brand needs as well as the needs of the retailer. Having all expectations laid out at the start of the relationship is helpful for both parties.
Some key areas to think about include:
What (if any) additional discount will be expected and what does the retailer need to do in order to receive it?
What will happen to slow-selling items and will the brand be responsible for any markdowns that need to be taken?
Will the brand be responsible to contribute to internal marketing?
What sales results are considered successful to the buyer in the first season in store?
Will the retailer require exclusivity in their area, and what does 'exclusive' mean to them?
ONGOING RETAILER RELATIONSHIPS
Once you have secured initial orders, it’s tempting to relax and think the hardest part is done. After a brand enters a major retailer it's incredibly important to develop, nurture and maintain relationships with associates in stores, not just those at the Head Office.
Regular store visits to visually merchandise, train, and speak with Department Managers or Sales Associates are crucial, ideally every six weeks-eight weeks for your biggest store locations. Taking time to ask for feedback, providing any marketing tools, and even sharing any interesting PR are all good tactics to get them excited about your brand - they are essentially your brand ambassadors and you want to be at the top of their minds when they work with customers.
ANALYSIS
Lastly, regular data reporting and analysis is the tool that will give you an edge with any large retail partner. Department store buyers are very busy and often manage more than 50 different brands. The more work you do for them in regards to keeping on top of best sellers, slow-moving merchandise, and store-level results, the faster your brand will grow.
If sales analysis and pinpointing trends are something new to you, it’s definitely worth investing in external help as this is one of the key factors to long-term wholesale success.
Have any questions or are interested in learning how your wholesale strategy ties into your larger strategic plan? I’d love to connect and see how I can help!