Building a consumer brand faces many challenges, especially in the early days. Many inexperienced start- up producers get the idea that if they can just get their product on the retail shelf, then they have succeeded. But nothing could be further from the truth. We found that if a brand has to go through a distributor, wholesaler, or jobber to get to retail, it can disappear as quickly as it appears.
The fact is, until you are on the shelf you cannot be discontinued. Makes sense, right? But when you are a new consumer product, oftentimes as soon as you get on the shelf, you get discontinued. Why? Mostly due to distribution issues and surprisingly seldom due to price or quality issues.
1. No Reorder. It was so new that the retailer or the distributor’s sales rep simply forgot to reorder it. If it was coded wrong at the store, it didn’t get reordered. If the distributor’s rep oversold another brand, your product still suffers and wasn’t reordered.
2. Wrong Price. Even though you sold it to the distributor with the understanding that he would sell it to the retailer at a certain price, either the retail misread the invoice or for some other reason put a price on it that was too high and it didn’t sell.
3. No support. There was no signage at the point of sale introducing your new brand, what it stands for, or who endorses it. It required a few compelling reasons to buy it, which were not there. So the customers didn’t buy it and it was closed out because it didn’t move fast enough to justify the retailer’s overhead to keep it there.
4. Still in the Back Room. It never made it to the shelf, even though it was delivered to the store. Neither the store clerks nor the distributor’s reps placed it on to the shelf or into a display. It just sat in the back room for a month or longer and of course never sold. So it was discontinued.
5. Wrong Delivery. Even though you expected it to be at the store, and might even have reports from your distributor stating as much, the wrong product was delivered. After 30 days of no sales, it was deemed a “slow mover” and discontinued.
This is just the short list of what can happen. How do we know? This all happened to us, and much, much more! What’s the solution? Start small. Make it your business to know about every retailer who carries your product as soon as they put it in. You, or one of your own people, must go visit the retail account in person. This is why it’s so important to start locally in a small, manageable geographic area so you can quickly manage your product on the shelf. Ideally, visit the account within days of the new placement. Put a checklist together with everything you need to look for. Don’t assume anything. When you find a new problem, add it to your list. We had 30 items we checked in every new placement. Some accounts would have two or more missing.
It’s essential to your brand’s reputation that you keep every account you open. When you open in a new territory, you want start with the reputation of being a “hot mover,” albeit in the small area where you started. By policing every new account immediately and with timely follow-ups, you will gain the traction your brand deserves, and not be here today and gone tomorrow!
Who Are We.
Having built and sold a bestselling national brand, we appreciate the value of brands and everything it takes to make them successful. Companies are valued by their brand equity. Achieving and maximizing brand equity requires tremendous respect for all your customers, from your wholesaler to your end user.
Starting in our laundry room with no money and no knowledge of the industry, we built the famous Barefoot Wine brand. We learned a lot they don’t teach in school and much of it the hard way. Although our success was in consumer products, our real world experience will be helpful to anyone looking for information and advice about brands.
We have written the New York Times Bestselling Business Book, The Barefoot Spirit: How Hardship, Hustle and Heart Built America’s #1 Wine Brand, which chronicles the history of the famous brand from its inception through its acquisition. Our book is now required reading in schools of entrepreneurship across the country. We hope this book will provide inspiration and encouragement for all those contemplating starting a brand or wanting to improve their existing brand.
Michael Houlihan and Bonnie Harvey
-Barefoot Wine Founders