by Carolyn Edlund
If your creative business has a presence in the wholesale marketplace, you might be selling to smaller retailers. But larger stores and chains are also possibilities.
Artists can sell handmade work at trade shows
How large retailers buy
Some chains have corporate headquarters where buyers will meet with vendors or their representatives to place orders for distribution nationally, or make purchases for large regions of the country. Other times, regional buyers may be the decision makers who work with vendors. Buyers sometimes specialize in certain categories, such as housewares, jewelry, clothing, etc. and you will need to speak with the correct buyer to present your line.
Other times, chain stores may be franchises, or under individual ownership. Hallmark stores are a good example. The benefit of being a franchisee is automatically having some vendor relationships and pricing through corporate, but these owners may also purchase smaller lines of merchandise that they order from entrepreneurs like you. This can make them good prospects for artists who wholesale.
How to reach them
Trade shows. Buyers for major retailers often attend trade shows to see new products and connect with their regular suppliers. If you exhibit at a show, you may be fortunate to be approached by buyers for large retail chains.You may want to include them on pre-show mailings to attract interest and invite them to your booth.
Online portals. Sites like Faire and IndieMe are “virtual trade shows” that never close. They offer artists and makers a place to show their collection to retailers who are looking for new lines.
Direct contact. Identify chain stores that you feel would mesh well with your brand and your collection, and find out names of buyers you can reach out to. These may be owner/franchisees, who would be easy to contact by calling the individual stores. In the event you are reaching out to regional or national buyers, you may be able to ask a local store manager for the contact number of their buying office.
Persistence is key in soliciting national chains. Buyers can be very difficult to reach; their time and attention is in great demand, and they may not return emails or phone calls. You may get the opportunity to reach a buyers’ assistant, however. Assistants are quite often gatekeepers, who may be able to schedule an appointment for you to make a sales call. If you already have an order from the chain, buyer assistants can be a great asset to you. Get to know them by name and work on developing a good business relationship with them.
Pursue trunk show opportunities. Occasionally, department stores and other chains will invite artists and other entrepreneurs to apply to participate in trunk shows, or “store within a store” opportunities. This allows the artist to introduce their line to the retailer’s customers and make sales. If your line does really well, your chances of being considered as a wholesale vendor are greatly enhanced.
Use sales reps. Reps make it their business to land store accounts. With large retailers, “national account reps” are often the people who pitch lines to the corporate buyers. If your small business has territory reps, they may be able to call on chain buyers in their area on your behalf, or reach out to regional buyers.
Taking the Order
Once you’ve been approached or have presented your work to a chain store buyer, you may end up writing an order. Sometimes this order will be a one-off. For example, if the buyer loves your handmade baskets and they would make an excellent addition to Easter displays the chain is planning, you might get this once chance to make a big sale and nothing further. Or, you could end up with ongoing orders from the chain, depending on sell-through of your line in their stores.
Be honest with the buyer about your production capabilities. Don’t overpromise, and put yourself in the position of scrambling like mad to fill a huge order that just doesn’t make sense for your business. You can always suggest that the order be created for one regional area instead of nationally, or request to stagger shipments to stores in order to allow you to produce the quantity desired.
The Purchase Order
When buyers for national chains place an order with you, they will create a Purchase Order, with details and with a reference number. This P.O. number is crucial – if you don’t have a Purchase Order, you don’t have an order. A buyer who tells you they will get a P.O. number for you must produce this before you should consider starting production.
Use the P.O. number on all correspondence or email with the buyer or anyone from the chain that you need to contact. Have it handy if you are on the phone too, because everything revolves around the number, which is trackable. Write your P.O. number several times on the outside of packages you ship, and put it on the packing list inside. This is used by receiving departments to check in the merchandise, and it will be used to pay your invoice, too.
Most chain store vendors are commercial manufacturers or importers. The more you can learn about the procedures common in dealing with chains, the better your experience will be, since you will be expected to comply with their policies. You may also receive information from the buyer after the order is placed regarding their requirements and procedures.
Terms
Major retailers hold a lot of sway with vendors who want to do business with them, and as the 800 pound gorilla, they often get their way. For creative entrepreneurs with small businesses, it can sometimes be a little scary getting started, but it needn’t be. Selling successfully to chain stores can transform your business and take you to the next level.
Chains don’t always demand discounts on their orders, but often do request price breaks due to volume. Know this going in. If you are willing to negotiate a better price for a large order, be aware of your bottom line and have profit built into your price so that you are making money, and enough of it to undertake production.
You may put a chain store on a Net 30 basis (which they will probably require) but in today’s world it’s not uncommon that these retailers take longer to pay. Be prepared for this.
It is also very common for chains to return items to vendors (this is across the board, it’s not just you!) If an item is damaged or broken in the store, or is returned by a customer, you might end up with a return you have to credit out.
Any questions about terms should be directed toward the buyer, or someone in their department if they are unavailable.
Speak Your Mind