Sales: perfecting your pitch for direct sales – farmers markets and online
The pitch is clear and concise messaging to explain to a buyer why they should purchase your product. Your competitive analysis supports the pitch, based on how you’ve described the problem or need that your product fulfills. When you meet with your buyer or customer, share information that is unique about the brand, and, if it makes sense, about you as the founder. In a few words or phrases, be able to describe what attributes make your product unique.
Farmers markets offer a venue to get feedback about your product’s taste, packaging, size, and price while you’re practicing your pitch. You’ll also build a customer following which can help convince retail buyers that your product will sell. Because there is no commission, selling directly to the consumer allows a greater profit margin.
Farmers Market resources include the Massachusetts Department of Agriculture’s Guide to Selling at Farmers Markets, the Massachusetts Department of Public Health’s Food Establishments at Events and Farmers Markets Questions and Answers, and the City of Boston’s What You Sell at a Farmers Market. Other venues include fairs, shows, and your online store.
Online food stores
Online specialty food stores bring artisan ingredients to professional chefs and home cooks around the country. Through web research, you can identify online specialty-food merchants. These stores often have information on their sites about how to pitch your product. For instance, Mouth.com, an online merchant for small-batch specialty foods, provides an email address for suggesting new products. Goldbelly, another specialty food marketplace for artisan makers, features an informational page for sellers. Food websites are growing and there are ecommerce platforms, such as Storenvy, Shopify, and Etsy, all focused on small artisanal businesses.
Sales: perfecting your pitch to retail and foodservice buyers
For a pitch to a retail buyer, information about the ingredients, price, case size, minimum order quantity, and your market research helps the buyer understand your product. You’ll need to know about their store values and customer expectations and where your product fits in within the store, based on your shelf-by-shelf research. Be prepared to explain your production capacity and how the product will be delivered, which will convey your ability to consistently fill orders.
The following topics will help you prepare your pitch:
- A list of retail stores where your product is a good fit
- Your brand’s product positioning
- Your brand’s features/benefits (why customers will be interested and how the product supports the retailer’s values)
- Competition, direct and indirect (competition from brands that have different products but target the same customers)
- How your product compares to brands in the same category and what sets it apart (flavor, ingredients, attributes, such as local, organic, or gluten-free and packaging, size, price, etc.)
- Your target audience characteristics (and how they match the retailer’s customer base)
- Market trends that support your product and customer interest
- Your support for the product (in-store demos, recipes, samples, social media, email program with key messages, etc.)
When you’re ready to make your pitch, prioritize the farm stands, independent and chain stores that would be a good fit for your products.
- Farm stands
- Specialty and natural food stores
- Online specialty food retailers
- Online subscription boxes
- Independent and chain grocery stores
- Cooperative grocers
- Inns and bed and breakfasts
- Kitchen and cookware stores
- Retail shops
- Gift shops
- Gift basket businesses
- Food buying clubs
- Foodservice companies
Create your list by researching these businesses. Membership in a trade association may provide access to buyer contacts. The first steps may include sending promotional material and setting appointments. Consider the geographical distribution of your product. Some locations you can visit in person and others you’ll contact by email and phone.
After you have your list, put together sales materials that include:
- A four-color point-of-sale sheet describing the product
- An order form that lists sizes, prices, minimum and maximum order quantities, shipping and handling costs, and discount or promotional programs
- Product samples
Buyer meeting tips
Find contact information for the retailer online, and when you call the business, ask to speak with a manager. Before meeting the buyer, develop a presentation with key messages to support your pitch. Briefly introduce your company and products and ask about their process to meet new suppliers. When you meet with a potential buyer, be prepared with why you think they should carry your product and why it will sell in their store. Keep your pitch short and to the point. Be ready to counter objections with positive statements about your product. Selling products takes perseverance, a good attitude, and an ability to respond positively to objections.
When you can’t meet a potential account in person, you’ll need to rely on phone calls and emails. Send the buyer information and follow up about a week later. It may take you a few tries before getting in touch with buyers. When you do connect, be ready with information on your product’s success with other accounts or your direct sales success.
Be prepared to close the sale. Salespeople will often have a closing device ready for the buyer who is close to placing an order but needs an incentive. It might be an introductory discount or in-store sampling. You could offer a discount for orders received by a certain date or include a free case with their first order. Structure your promotion so that you can afford to absorb the cost of the discount or giveaway. Also, be sure you can produce enough product if a retailer accepts your offer.
A note about buying schedules
Find out the ideal times to pitch buyers in seasonal markets. For instance, if you want to sell your product to a gift basket buyer who does the bulk of their business during the holidays, pitch in the spring. Some retailers that don’t normally stock specialty products will do so at certain times of the year. Find out when, and schedule your sales promotions, calls, and pitches to coincide with their buying schedules.
While distributors buy your product from you, brokers don’t. Brokers represent your product in return for a commission on sales. They sell directly to retailers and distributors and provide follow up to support your product on the store shelf. In some respects, they act in much the same way as a sales staff—selling, maintaining accounts, and representing your product directly to the buyer.
Look for a broker who has a proven track record, existing buyer relationships, and accounts that match your target markets. Because the broker is acting as a company salesperson, a good match is one who knows your market, likes your product, indicates an ability to generate sales, and has existing accounts.
A broker and its staff represent your company to buyers, so be sure you feel comfortable with their sales and presentation methods. Plan to occasionally join the broker on sales calls. This will help solidify your relationship, bring presentation problems to light, keep you in touch with the market, and confirm you’re getting the representation you need.
Ask for the broker’s track record on collections. Include language in your agreement that allows you to withhold commission until the vendor has paid for the product. You might also consider a policy of requiring prepayment for all new accounts. Let the broker know that you will qualify all new accounts before you deliver the product. You might also have a policy that allows you to deliver C.O.D. to existing accounts with a history of payment problems.
If you’ve been selling on your own for a while and want to contract with a broker or distributor, consider your existing accounts. Would you like to retain them? If yes, work with a lawyer to list those accounts in the agreement as non-commissionable. It is also possible to hold accounts that you are in talks with to save commission.
To find a broker, ask fellow producers, store owners and trade associations. You can visit this resource for additional information.
Are consumers likely to find your goods at farm stands, delis, gift shops, specialty or natural food stores, grocery stores, restaurants, or other establishments? How will your product get there?
Distribution is the means of getting your product into the hands of your customers. Food distributors buy your products and resell them at a profit to their accounts. They may provide storage and transport your products to the end user. You may want to have some joint sales visits.
Distributors offer experience, end user contacts, and market awareness. Most sell to specific market segments. For example, select distributors may focus on shelf-stable, frozen, or refrigerated products and others may specialize in a category, such as seafood or produce. Some food distributors partner to help market and sell products, while others fill orders.
Distributors have existing accounts and work to increase their market share. Distribution typically starts in one geographic area. Your distribution plan might initially lay out introducing your product locally and regionally.
To find distributors, contact other specialty and value-added food producers and trade organizations for recommendations and referrals. Distributors that represent similar or even competitive products can be a good match since they know your product category and target markets.
When you’re considering contracting with a particular distributor, request a list of their suppliers and buyers to determine if you are a good fit. Consider your production capacity, potential customers, the product’s shelf-stability, and delivery/distribution costs. Ask about the distributor’s success rate working with small businesses or producers like yourself.
You’ll both need to evaluate how well you might work together. As you investigate the credentials of the distributor, its team will vet you and your product. Be prepared to make your pitch and to listen to theirs. They will want to know about your production capacity and how you are planning to market your product. The more demand there is for your product, the more retailers will keep placing orders with your distributor.
Once you and a distributor have agreed to work together, hire a lawyer to ensure that you are protected. Considerations for a contract can include a cancelation clause, information on the territory the distributor covers, terms of the contract, pricing and order structures, and promotional allowances or sales support requirements.
Many small producers have limited production capacity, initially selling their product directly to retail or foodservice customers and managing their own distribution. As sales increase, distributors (and brokers) become more interested, knowing there is a proven record that consumers will buy your products.
If you plan to load up your vehicle and make the deliveries, there will be less time for other aspects of building your business. It’s worth checking with local delivery services and doing a cost-benefit review. Other strategies for more efficient distribution include increasing the minimum order, consolidating deliveries for specific days of the week, or partnering with another small food producer to have a larger volume.
Attending a trade show as a visitor is an efficient way to observe industry trends, size up competitors, and refine your strategy. Attending as an exhibitor means you’ll meet buyers, distributors, brokers, press contacts, and other suppliers. You can also advertise in the show guide to build brand awareness. Before you sign up for a trade show, consider several things:
- Will it allow you to reach your target audience?
- What is the cost?
- Could you fulfill the increased number of orders you might get, based on your production capability?
- How does the show fit into your marketing and business plans?
- What impact will the show have on your cash flow and production projections?
One of the best ways to learn about specific shows and gather general information about trade shows, competitors, and the industry is to attend a show as a visitor. Walking the aisles and talking to some of the exhibitors is an efficient way to conduct market research and prepare yourself for exhibiting.
Different kinds of trade shows and exhibition opportunities exist. At retail shows, you sell directly to the consumer. At wholesale trade shows, you sell to buyers that represent supermarkets, specialty food stores, restaurants, or other businesses.
Retail shows give consumers exposure to your products. Selling at retail prices means you’ll make more money. You’ll be able to understand consumer reactions to your product and its pricing.
Wholesale trade shows give you the chance to meet retail buyers and distributors who may purchase your product. These events also help your company meet press contacts and build trade awareness of your product.
Cooperative participation might be an option. Many departments of agriculture or organizations carve out a pavilion within a large trade show. Brokers and distributors may also offer booth space under their umbrella. Being part of a pavilion or shared space can add to your presence at the show and help to save money on the exhibit costs.
Once you’ve decided to participate in a show, you’ll need to address product availability. One of the biggest mistakes a business can make is overcommitting. Avoid selling what you can’t deliver on schedule.
Before you participate in a show, make sure your production system is reliable. Project how much product you might need and how quickly you can deliver orders. Also, consider cash flow implications. How much credit can you extend? Are you able to cover the cost of packaging, labeling, and producing products?
Determining the implications of show participation will provide you with a better understanding of your sales goals for the show.
Designing your booth
Trade show booth design is an industry. While many specialty food producers design their own booths, others work with companies to create their booth spaces. As you attend some of the larger shows, you’ll see the competition and notice which booths garner attention.
If you decide that you don’t want to tackle the booth design yourself, consider hiring a local booth designer. Ask for recommendations from other business owners. As an alternative, think about hiring an interior designer or a theater set designer.
Selecting and working with a designer
Whomever you choose, set a budget when you contract for design. Get all the specifications and regulations from the show management at the start of the design process. Shows often have strict guidelines for exhibitors.
Keep in mind that you’ll have to transport the design materials to the show site. Use sturdy but lightweight materials, and make sure they fit easily into a car or truck. Think about designing a backdrop and signage that you can use in different situations.
Allow plenty of time to get everything produced and hold the designer responsible for delivering the finished work on time.
At the show
This is your chance to meet consumers and buyers face to face, as well as brokers, distributors and press contacts. Plan to capitalize on the opportunity.
Be prepared with your elevator pitch for your product. Sometimes you’ll have a split second to get the notice of buyers. You’ll need to grab their attention with the booth display, get them to sample or look at your product, and find out what product attributes are most meaningful for them.
The more informed you are, the more convincing your sales pitch will be. Share the demographic information you’ve gathered. Talk about your customers and your target markets. Share your success stories, press coverage, awards, and sales figures. Have printed point-of-sale material and contact information available.
Building and using a mailing list
Have a means for collecting buyers’ cards or contact information. You may not be able to talk to everyone that stops by your booth. Be clever about getting their contact information for later use. You could hold a drawing for a prize. Buyers, brokers, media contacts, and attendees can put their business cards in a box to be eligible for the drawing. You can use these same tactics at a retail show to capture names for future promotions and news about new products. Business card and badge scanners may be available from the trade show organizers.
Do your homework
Get in touch with the buyers you want to meet and invite them to visit your booth. If the show promoter shares a media list, invite those one it as well. Trade shows offer opportunities to get your product seen. Enter raffles, donate products for use at show events, and enter contests that might help you get recognition.
Working the show
Don’t underestimate how much energy it takes to pitch your product all day long. Practice beforehand. If you don’t think you have the personality to sell at the show, perhaps a staff member is better suited. You can be on-hand to discuss the product and answer questions.
Selling against your competition means making points about your strengths while refraining from too much criticism. Read badges and make eye contact with good prospects. Project your sense of pride and enthusiasm. Be generous with sampling.
- Walk the show before you exhibit. Talk to past exhibitors for their input about the event.
- Ask about cooperative space. Exhibiting with other vendors as part of a larger booth can save money and provide some backup.
- Establish a budget that includes all costs such as the booth space, furnishings, signage, samples, travel, lodging, meals, and badges. Include labor costs if needed. Note which expenses are built in. Many shows have strict rules about what you must rent from them. Scanners, electrical hookups, tables, chairs, refrigeration, and storage fees can often be added to the basic registration fee.
- Review your contract to note the deposit details and what the cancelation penalties are.
- Make a list of items you’ll need in addition to your booth display: samples, sample cups, napkins, tablecloths, hammer, tape, extra light bulbs, paper and pens, business cards, file folders, a lockbox for cash (if necessary), snacks, and other incidentals.
- Enjoy yourself!