Getting to the shelf if you are not in the plan o gram is even more challenging
We have been discussing some of the challenges of distribution. This is time consuming, expensive and can be frustrating.
Distribution is a 3 step process
After you have done the work to get your product produced and packaged, if you are selling in retail, you need to get it to consumers. You have 3 steps to get there:
1. Get the product from your production facility into a distribution network.
2. Get the product to the store
3. Get the product to the shelf.
Step 3- Getting to the shelf
This is the shortest distance but the toughest to get right. Once your product gets in the store it has to get to the shelf. If it does not get to the shelf, all of the hard work and money you have spent will be wasted.
You will be judged by your product sales. You need to ensure the product gets to the shelf.
Products that are not in the plan o gram
This is even more challenging…
The retailer has listed your product, but you are not in all stores, so they do not include you in the plan o gram. Some departments like produce and deli cheese do not have the commitment to plan o grams like the grocery department. SKUS change more and merchandising flair at store level can make a difference.
You will need to find the spot in each store where your product will be. The best place is in or adjacent to the category. Consumers buy most of their items from the regular section. This requires a lot of work and commitment to develop relationships store by store. Once you find out the person at each store who will work with you on shelf placement determine the regular point of contact. It might be the same person or someone else. Keep these people on a list and communicate with them.
When you carve out your space on the shelf, you need to protect your turf!
Keep track of where your product is in each store. You might even have to promote this direct to consumers to tell them where to find your products.
You need to create a process within your business to keep the shelf full. Most stores, especially the larger retailers, will not call you when stock runs low. They will expect you to be in the store regularly to keep the shelf full. If your space holds 12 units and you sell 6 units per store per week you need to be in these stores at least every 2 weeks. Create a schedule for store visits to maintain adequate inventory levels. With remote locations you can set up a system to call your champion at store level. Find those people who like your products and will keep an eye out for you.
Some suppliers do have success with shipping product to stores via courier or transport company. It is more cost effective, but this is a challenge if you do not have retail coverage. If you do have sales reps, they will have to visit stores soon after deliveries to make sure product gets to the shelf. If you do not have sales reps, you risk the product sitting out back and losing your space on the shelf.
The best way to ensure your product stays on the shelf is to keep the shelf full!
When you negotiate your space, you need to ensure you understand the correct process with your customer, the store to keep the shelf full. Some stores will allow you to come in, assess the in-stock position and bring product in to fill it up. Other stores will want to put inventory on the shelf. This can be a unionized store where they are more protective of their hours and their work. Just ask the questions when you get started so you know the rules of the game.
Find your champion at each store!
They can be a huge asset to you if they like your product and are interested in your success. They are there all the time and if there is an issue with out of stock they are more likely to contact you if you have a relationship with them and they know you. If you do invest your time and money in demos make sure to spend some time with the staff.
One big advantage of doing your own distribution is that you know the units going into each store. Assuming you are not having code date issues or other problems you can track these shipments to calculate your units per store per week. You should know how much you are selling in each store. A number you should track and measure. This is how you will be judged. Measure results and plan for growth. Pay close attention when you have any promotions happening to see if you get a lift and if your baseline sales grew.
Our top 3 suggestions for the most challenging step in distribution:
1. When you carve out your space on the shelf, you need to protect your turf!
2. The best way to ensure your product stays on the shelf is to keep the shelf full!
3. Find your champion at each store!
It has been a busy week. It was great to spend the day Monday with food and beverage entrepreneurs in Saskatoon. We did a “Perfect your Pitch” workshop with Sue Oguchie and Learnsphere. Later in the day I had the opportunity to talk about getting on the shelf, pricing and getting off the shelf with Prairie Food Link.
Then it was off to Winnipeg for the FCC Food and Beverage Summit. A great day with so many insights shared by the different speakers on the program. We did a fireside chat about the FCC Inno Centre advisory program with Eric Waterman and Megan Menzel. A great opportunity for food and beverage businesses. Then JP Gervais from FCC and Joanne McArthur shared some great information about economics and success in the industry. After lunch, we had Carman Bezan share their purpose, which motivates them at Carzan Meats. Then, we had Sheena Russell from Made with Local, Shawn Black from Sheepdog Brewing and David Cote from Loop Mission. I got to do a panel with Sheena, Shawn and David where they shared even more. The day finished with a fire side chat with Chris Parker from Tree of Life. Carly Minish Whytinck from Smak Dab did a great job as MC and we have so many Manitoba/prairie businesses there. What a day! Thanks to Sue Exner and the FCC team for including me.
Thursday was a virtual session with Sue Oguchie and Learnsphere for food and beverage businesses in the food service space from Alberta. Then off to Toronto for a day of artisanal ice cream with Kayvan Mahbod and Karen Geng from Demetres.
Next week I will share some insights from my conversation with Chris Parker from Tree of Life. It is a continuation in our theme of distribution.
Peter
SKUFood Recipes for Success Podcast
The response to our SKUFood Recipe for Success podcast has been great. We want to thank everyone who has been with us as a guest. So many interesting conversations about our industry.
With thirty-three years on the retail side, Eric has honed his skills in distribution center operations, health and safety, process improvement, and more. His diverse expertise spans from quality assurance to procurement, bringing a wealth of knowledge to the table.
But Eric's journey doesn't stop there. For seven years, he's lent his talents to the supplier side, excelling in sales and marketing roles. His contributions extend beyond individual companies, as he's actively involved in industry organizations like the CPMA and CFIA advisory board, where he's made a lasting impact.
Currently the Director of Sales and Business Development at Algoma Orchards, Canada's largest independent apple grower, Eric continues to shape the future of the produce industry.
Join us as Eric shares his insights, lessons learned, and the secrets to cultivating success in this ever-evolving field. Whether you're a seasoned professional or just starting out, this episode is sure to leave you with a recipe for success.
Plant was not following proper protocols in Listeria outbreak
In a listeria outbreak last summer where 3 people died, the Canadian Food Inspection Agency (CFIA) is saying the processor was not properly following Health Canada's policy on preventing contamination.
The company was not swabbing finished product samples properly. A reminder you can’t have too much vigilance over your processes to ensure they are being followed.
I do have travel coming up to Calgary, Saskatoon, Winnipeg, Vancouver and Lethbridge so if you want to connect or have an even in any of these locations give me a call or send me an email.
Excited to be participating in this series for N.S. businesses looking to export. Practical information from a variety of perspectives to support the export of N.S. food and beverage products.
Looking forward to the second Agri Food Innovation Expo. Last year there was a lot of great information shared with producers and processors in Red Deer. This year in Lethbridge the even promises to be even bigger.
