Sales per point of distribution
One of the most important numbers in your business
Sales per point of distribution (SPPD) is the number of units you are selling in each location where your product is available. A very important number and one that should guide a lot of decision making in your business.
It is almost always better to drive more SPPD than it is to get new points of distribution. You are already on the shelf and (we assume) you are already investing in consumer marketing in this geography.
You really do have to understand how many units you are selling per store per week or per month. This is how your customers will determine if you stay on the shelf. They have expectations for sales and your products need to meet or exceed them.
Your sales people need to really understand SPPD and try to maximize this number.
It is almost always something people do not focus on…
We understand it is more exciting to get a new listing or a new customer. The thrill of someone saying YES, we want your product in our store is great. The issue is, every new customer adds complexity and costs to your business.
One of the benefits of doing what we do is we get to work with a lot of food and beverage businesses from coast to coast. There are not many examples where we would say the business has maximized SPPD. Usually, the numbers are less than 10 units per store per week. With thousands of consumers shopping in each store every week, there should be opportunities to increase this number.
Consider the work required to get a 30% sales increase. You could pursue a new customer, perhaps pay listing fees and do all of the work to get your product in their stores. Or you could sell 3 units more per store per week.
It starts with measuring your results
You need to know your SPPD. If you are delivering direct to stores (DSD) then you know exactly how many units you are putting in each store each week. If you do the work yourself track the results. If you work with a distributor, make sure you get monthly sales reports and track the results. DSD is more work and more expensive. One of the biggest benefits is you know exactly what is selling where.
Rank your stores ABC with A being the top third, B the middle and C the stores that need to improve or you move on from them. If A stores are 10-12 units per store per week try to understand why. Is the product merchandised differently, the staff are your advocates, you have done more demos because they are close to home or some other reason. Figure out why and then take these tactics to your B stores. Work hard to get them up to an A store level.
If you sell into the warehouse this can be more challenging. You can work with averages (500 units into the warehouse in a month with 50 stores is 10 units per store per month). Sometimes your customer will share some store-by-store sales. This is great if you can get it. If you are in the local program or small supplier program, they will be more willing to share. If you invest in promotions, they might be more willing to share some store-by-store numbers. Another source can be the stores themselves. If you visit a few stores, they might share movement that you can use to create your own tracking.
This is all work but important work for your sales team.
Set targets
Once you have started to measure the results, set targets. People need to be challenged to figure out how to get from 10 units per store per week to 13 units per store per week. In other words, a 30% sales increase. A very good number for just 3 units per store per week. This can require some investments in trade spend. Be careful to invest where you get a return. More units are great but they also need to be units that deliver a profit. As we used to say at Loblaw, ‘any fool can give it away’. Be strategic about investments that deliver units and a return.
Review targets with your sales people regularly. This is not exciting work but it is some of the best work they can do. When you create your sales budgets, you can leverage the SPPD information to help build the budgets. These are the targets you can compare to every quarter.
Talk to your customers about SPPD
Your sales people should talk to your customers about SPPD. Your people should know what the customer expectation is and also how to get that 30% increase you are planning for. Any time your people can walk into a customer with a plan to generate 30% more sales I am sure the retailer will listen. They are working in a world where 5% increase in tonnage is great. There are a few exceptions, but that is their reality in a world where other channels including online and food service are trying to sell people more food and beverage.
It is a balance
You must keep your sales people motivated and accountable. For most motivated is bringing new customers in, accountable is driving SPPD. As we said it is exciting and rewarding to land a new customer. If it is within the current geography where you are doing consumer marketing and your brand is well known that can deliver more immediate benefits. Launching in Vancouver, when you are only known in Alberta is a real challenge and requires a lot more work and money than just getting a listing.
Usually, SPPD will deliver better results for your business. We agree it is not as exciting. The challenge is to make it exciting and rewarding.
Peter
SKUFood Recipes for Success Podcast
In this episode of Recipes for Success, we sit down with Red Seal Chef Sarah Bennetto O’Brien, founder of The Handpie Company, makers of chef-crafted, savory personal handpies that bring quality, local ingredients, and real flavor to Atlantic Canada’s frozen food aisles.
Launched in 2017 with a mission to create grab-and-go meals that don’t compromise on taste or integrity, The Handpie Company uses real butter, Island beef, potatoes, and more. Every pie is chef-made in a CFIA-licensed production facility, ensuring consistent quality in every bite.
Sarah shares how she turned a love of local ingredients into a thriving brand, navigating challenges like scaling artisan quality for the freezer aisle, maintaining local sourcing, and expanding into new retail channels. Today, their products are stocked in over 100 locations throughout the Maritimes, including grocery frozen food aisles, cafés, and taprooms.
We also dive into the early “pie in the sky” idea, the leap from café menus to owning their name and space, and how the team has stayed true to their core values, chef-made, locally sourced, and convenience without compromise.
This conversation is about more than pies, it’s about building a local food brand with community, blending taste and integrity, and pushing the boundaries of what a frozen product can be.
If you like what you heard leave us a comment or a review and subscribe wherever you listen to your podcasts.
Listen and subscribe wherever you get your podcasts.
If you would like to be a guest send us a note. We are always working on the upcoming episodes.
Pricing and Distribution Changes
The Liquor Control Board of Ontario (LCBO) will be the exclusive wholesaler of beverage alcohol in Ontario and with that comes a few changes. The new wholesale pricing model will be introduced January 1, 2026 looking at landed cost + wholesale mark-up + COSD (if applicable) + container deposit +HST.
I talk to suppliers all the time about how important it is to understand how to price your food and beverage products properly in order to be successful. You are in control of the price you are selling into retailers and wholesalers.
FCC launched food and beverage peer groups to bring together individuals who were looking to grow, expand or diversify their business in their ever-changing environment. Groups are also facilitated by highly regarded experts in the industry. The goal is to create a confidential forum that allows members to speak openly about the challenges they face as business owners and share their collective knowledge and expertise with one another, fostering problem-solving strategy implementation to advance their business.
Where is Peter speaking?
With the focus on Canadian food and beverage we wanted to share a program we have developed with Alain Bosse, the Kilted Chef. We partner to share insights about Canadian food and beverage at conferences and events. We talk about where products come from, share insights about some hidden gems and of course Chef Alain has great tips for using the products at home. This is designed to be entertaining and engaging. Not just for food industry audiences, it works for everyone.
I do have travel coming up to Toronto and Fredericton so if you want to connect or have an event in any of these locations give me a call or send me an email.