Kelapo is a company that bases their business practices on their personal practices of taking care of the planet and the people around them. The company’s organic, fair trade products are a reflection of the beliefs of those who run it. I had the opportunity to talk to Kelapo’s Erin Meagher about working with wholesalers and got some tips you can use too.
How long have you been selling wholesale and why did you decide to do it?
We started the company in 2009 and it took a while to get the product produced so we didn’t actually start selling until Oct 2010. The plan the entire time was to sell online through our e-store, but to also sell it wholesale so that we can be on grocery shelves everywhere. There was no question since we are selling a food product that we would go the wholesale route.
How do you find stores to sell your products to?
That part is probably the easiest! We sell into natural foods stores, grocery stores, nutrition shops, and more. Our accounts range from family owned businesses to large chain stores. When we go into an area that we don’t personally know it usually just takes a quick Google search to find all the stores. But sometimes it can be harder than that because we’ve found that many health food stores don’t keep their online listings up to date or don’t have a website at all!
What types of stores do you sell your products to?
We sell to any store that carries food products. We also sell into doctor’s office, gyms, and massage clinics.
From your experience, what is the best method to contact stores?
Emails usually don’t get returned especially if you email someone and they don’t know you. It’s best to qualify an account on the phone first to find out what their needs are, their frame of mind for carrying a new product, their ability to authorize a new product and more. That way when you set up a meeting or stop by an account you can really tailor your sales message around them. Also, it’s great if you have some common ground and have met the account previously at a tradeshow or event.
Approximately how many stores are your products in right now?
We are in around 800 stores nationwide and are also carried in Canada and Puerto Rico.
Do you attend trade shows and, if so, which ones?
We attend 4 large tradeshows and one smaller regional tradeshow each year. The biggest is the Natural Products Expo West show in Anaheim, CA each March. We also go to Expo East, this year in Baltimore, in September. Our two new shows are Fancy Food Summer, in DC, and Winter, San Francisco. We have never been to the Fancy Food show before but we are hoping to reach the gourmet food stores that aren’t necessarily present at the Natural Products shows.
Has the economy affected your wholesale business? If so, how?
People are definitely watching what they spend so retailers are careful about price points of the products. Even so though, our coconut oil sells well and it definitely isn’t the lowest price point amongst competitors. We’ve also seen that a few retailers have gone out of business and that is disappointing whenever a store closes because it’s another opportunity lost to reach our consumers in that neighborhood.
From your experience, what are the top three most important things to keep in mind when doing wholesale?
The most important thing is to be respectful to the store and the associates. If they decline to carry a product, don’t take it personally. Or if they only like being called on once a month, don’t call more than that. They are also running a business and very busy, just as you are, so it’s really important to treat them like you would like to be treated.
Also, all businesses are of equal importance. Don’t feel that because a business might be smaller and not sell as much product as a Whole Foods, that you should treat them any less.
Other things to keep in mind, are again, how can you help the store meet its goals? The point of wholesale is not that you sell the product into the store and collect your money but you have to help that product sell as much as possible, what we call pull through. You want the customer to pull your product off the shelf so that the account will re-order from you. What can you do to help that? We take consumer branding and awareness as our top priority and have helped promote our coconut oil by holding in store tasting demonstrations, daily food blogging posts, tv commercials, press coverage and more.
How do you balance doing both wholesale and retail?
Our direct retail sales are only through our e-store. It’s pretty easy to keep up and fill orders as they come in and ship them out through the mail. Wholesale is a challenge because you need to keep detailed notes about each account, stay on top of ordering so they are never out, and keep the account happy. We’re using a new website, komida.com, to help us track our wholesale orders and let us know when an account hasn’t placed their usual order or is starting to place orders more frequently. Komida is great for data tracking and analysis to really keep your business headed in the right direction.
What are some mistakes you have made while doing wholesale?
I wouldn’t say that we’ve made mistakes. It’s hard to say that something we did was flat out wrong. I like to see every challenge as an opportunity to learn and do it better the next time. Really this is true in all aspects of business, not just wholesale businesses.
What do you wish you knew before you started selling your products wholesale?
I wouldn’t say there is a secret to selling wholesale. Make sure you have a great product that you can stand behind and believe in. Create dynamic packaging and make sure you are retail ready with barcodes and all that. Print up sales sheets and price lists to present to your wholesale accounts and then start selling! You’ve got to go into a lot of places and create lots of leads for yourself. Many people won’t buy on the first encounter but we’ve found that 3, 4, 5 months later, they are ready to make a purchase, so don’t forget about them.
Anything else you’d like to share about selling wholesale?
Make sure you’ve reviewed your pricing and margins before quoting sales prices. You can sell direct to wholesale at a higher price than you sell to distributors. So if are giving your wholesalers a fabulous deal and then you sign on with a distributor, you’ll have to give them an even better deal because they take a percentage of the sale. Before you know it, a product that you were making 50% margin on could drop to below 20%. Luckily, when we started, we knew about dealing with brokers, distributors, and wholesalers and built in margins for each group and still kept our margins intact. If you’re still concerned about bringing a product to market, read up on it first. There are a lot of good, easy to read books that help first timers navigate through the selling channels.
Comments on this entry are closed.