How to Become a Retail Vendor: a Simple Guide | FundThrough
Breaking into the world of retail can be a challenging experience. Planning ahead and building your network will be important factors in driving your success.
Breaking into the world of retail can be a challenging experience. Large retailers might grapple with over-saturation, debt, and intense online competition. Some of these same challenges apply to smaller retail businesses as well. In fact, in research conducted by Square, 72% of business owners concur that small businesses face more challenges today than they did five years ago. In the same way, retail vendors face many of the same obstacles.
Planning ahead and building your network will be important factors in driving your success.
What is a Retail Vendor?
The Most Important Skills Of A Vendor
Just like business owners, vendors need guts and grit to compete and succeed. There is no one type of person for the job, as most skills can be learned. However, most vendors are self-driven people who understand the basic principles of sales.
- Product Knowledge
Product knowledge is first and foremost the most important skill a vendor needs to master. Without it, and you won’t sell a thing. Product knowledge is vital to hone your sales pitch so your customer will buy your product or service from you rather than from your competition.
- Customer service
Many people agree that the days of great customer service are gone forever. This is your chance to prove them wrong. Offering assistance to current and potential customers, fixing problems, answering questions, and giving them the confidence you can deliver are all part of the customer service experience. Building strong relationships will keep your customers coming back.
- Positive attitude.
This seems obvious. But a positive attitude can be the difference between making a sale and walking away empty-handed. Even in stressful situations, an optimistic attitude can mean a positive outcome.
- Sales goals
Confucius once said, “If it’s obvious that the goals can’t be reached, don’t adjust the goals, adjust the action steps.” Sales goals are bound to time but can be just the motivator you need to work harder—for yourself and for the company you represent, as well as for both current suppliers and potential suppliers.
Familiarize Yourself With The Industry
As a potential vendor, one of the most important things you can do is get to know the industry you represent. It’s not only vital that you know the industry, but also the produce, product, or products you’re selling. It’s fundamental that you can explain the industry’s potential for growth, the general state of the industry, and how your business model fits into the landscape.
Industry analysis is part of basic pricing options, market guidelines, and good management. Most of the people who successfully become retail vendors already have relevant business experience, sometimes as employees themselves. Understanding the industry and becoming a successful vendor means looking for a detailed list of features that includes:
- Distribution patterns
- Industry participants
- Competition and buying patterns
- Levels of pricing
The more you know about your industry, the more advantage and you will have.
Determine Your Business Goals
Business goals are the actionable steps you need to take to grow as a retail vendor. Without goals, there is no measure of success. Of course, you can set high-flung goals that you have no way of meeting, or you can set reasonable goals—a step process—that will prove a successful outcome.
- Are your goals specific? Setting a goal to increase revenue is fine. But by how much? Setting a goal to increase revenue by 20% gives you something to work towards.
- Can you measure outcomes? Your goals should be measurable. If a goal can’t be measured as a success or a failure, it doesn’t do you any good.
- Can it be achieved? The whole point of setting business goals is to achieve a specific outcome. Lofty goals can be motivating, but can fall apart quickly. Whereas, realistic goals can stand against the odds. That way if something takes a wrong turn, you can adjust your goals and still have a favorable outcome.
- Are your goals relevant? Every goal you set for yourself should be tailored to your strengths and weaknesses. In the same way, your sales goals should be relevant to sales.
Are your goals bound by time? Business goals should be bound by time. Your goals may be specific, measurable, achievable, and relevant, but if you haven’t set a timeframe for reaching your goals, you may never get there. Ask yourself, do you want to reach your business goals in a month, a year, or in five years?
Make you sure You're Ready to Become a Retail Vendor
Production capacity, quality control, distribution logistics…these are all aspects of the business that you must carefully consider before letting a retailer know you’re ready for their order. If you cannot get the product on the shelves, or a faulty product is returned, you could irreparably damage a once-in-a-lifetime relationship. Your competition is waiting right outside the door.
One of the most common challenges that can cripple and sink a burgeoning company is financial difficulties. If you don’t have enough money to produce your product or even keep the lights on, you’re in trouble.
Avoid financial worries by planning for cash reserves or by having supply chain financing or invoice financing partners that can help you bridge any cash flow gaps you might experience between the time you fill an order and get paid.
Connect with Purchasing Managers
Your relationships can either elevate your product to mass adoption, or add you to the long list of failed products. If you want to be the next iPod and avoid the fate of the Zune, you’d best start schmoozing with those who are most influential.
The purchasing managers of retailers are the ones to woo, and LinkedIn is one of the easiest and most effective ways to do so.
For every retailer that you want to form a relationship with, search LinkedIn and connect with its respective product managers. Prepare a short pitch that will impress them while keeping you and your products on their radar. Even if you’re not ready to make a sale yet, it will be much easier to approach the right people if they already have an idea of who you are. Better yet, walk into the retail establishment and introduce yourself. Taking the time for a face-to-face meeting can imply you mean business.
Learn to use the Vendor Portal
To make sure that you don’t falter when it comes time to fulfill those orders, make sure you are familiar with the retailer’s vendor portal. Vendor Portals help suppliers learn vital product information, pricing strategies, periodic updates, and much more. Each portal is a bit different so it pays to take the time to learn a portal well.
Take Advantage of open Vendor days
Another element for retail vendors to capitalize on is open vendor days. Many retailers hold these events to connect with new vendors, share information, and develop personal relationships. Take the time to prepare small presentations and product demos to show the retailer why they need to take you seriously and how well prepared you are for their business.
Before heading to the event, always prepare. Most major retailers provide an outline of requirements for vendors on their websites. For example, check out Home Depot’s guide:
If you are a new vendor, creating relationships with retailers will be one of your greatest challenges. Keep this is at the forefront of your strategy, but also be aware of where small vendors typically fail. Keep your company growing by seeking new retailer relationships, while soundly managing your finances to ensure your retailer vendor relationship is healthy, as well as lucrative.
Put FundThrough to work for your Business
FundThrough helps small business owners navigate cash flow hurdles. Sign up in just 3 minutes and receive a credit limit approval within a business day. FundThrough has the highest customer service satisfaction in the industry. We offer complete transparency and integrity. If you’ve been waiting up to 90-days to be paid on your invoices, our customer service team is standing ready to fill your gaps in cash flow.
Client question: Worried About How to Ask for Payment? Here’s How Invoice Factoring Companies Should Work with Your Customers
It’s a common question business owners ask: how do I ask for payment? Whether you’re dealing with a customer whose payment is past due or
No doubt the oil and gas business is one like no other, with a vital role in keeping our global economy moving (literally and figuratively!)