ESYB2 141 - Selling in Brick and Mortar Stores
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[00:00:00] Many people want to sell their products in brick and mortar stores. So in this video, I'm going to tell you about two case studies of real situations of people trying to sell their physical products in stores. First of all, is actually my book that I wrote. First of all, to get into big stores in United States, it's Barnes and Noble, that's the giant store, you need a literary agent.

For an individual, it's just not possible. So, you can go to small stores, like independent bookstore, but the problem is that they sell almost nothing. And pitching and managing those tours is an absolute nightmare. There's usually very few in your surrounding area because they're dying all the time. So sometimes you can visit one or two in person, but the rest of them, you have to.

Very impersonably just call the email or something like that to ask them if they will take your book. And even if they take your books, they take them on consignment, meaning they don't pay you until they sell it. Meaning you actually have to spend the money to print the books and send it to them. So you have to [00:01:00] invest the money.

They might never even sell it. They might never even put it on their shelves. And even if they do sell it, it's for very little because they can only have enough shelf space for a handful of books. So you're probably looking at like Under 100 every quarter, and that's like very optimistic. Which basically makes it not a way you can realistically earn any kind of money.

Because also keep in mind, if you sell a book for 15, they take a cut, the shipping takes a cut, the printing takes a cut, so it's like, you keep a few bucks at the end. Management nightmare, almost not worth it. That's what I decided for myself, I'm like, I'm not gonna be doing that for my book. So that's the story of books now a client of mine who had a cooking product It was a kind of a decorative decorative salt You need very unique kind of a food product and it is possible to get into really big supermarkets But what they do is first they put you in stores regionally so if you say I got into a gigantic stores while that store might have like a thousand locations and The [00:02:00] country or the world, but like, they only put you in one or two to test you when they test you, they give you a lot of requirements, very expensive packaging so that it doesn't go bad, even if it's on the shelf for like six months and they require you to pay for extra marketing, extra giveaways, sample giveaways.

So essentially you lose money up front and then because it's an unknown product, usually you get a very low offer of what they sell. Like they might sell your product for 5. But you get maybe, maybe get a dollar and in that dollar or two dollars that they offer you, you have to make the product, package the product, pay for your own time and it's nearly impossible to make a profit.

So you either get an extremely low profit or you might even Operate at a loss per sale. My client, they got their product into Whole Foods. If you don't live in, in United States, Whole Foods is like a high scale, big supermarket. And they got their product into Trader Joe's, which is like a [00:03:00] very cheap supermarket.

All have many, many, many stores, but they started out regionally and. Trader Joe's, they usually price the product lower, so they were able to only offer an extremely low price per sale to my client, who had absolutely no way to create the product and package it with any profit. Like, literally, the more she would have sold, the more she would have lost.

And the worst part is that, even if you get going, all of this can stop at any time. If they see, like, that shelf space that they're giving you is not making enough for them, boom, goodbye. They don't have to ask anyone for permission. Especially if you're not a known brand. And all this takes many months, a lot of headaches, sometimes even legal paperwork that you have to pay extra.

Of course, if you become a popular brand, like some kind of new food that now all of a sudden everybody absolutely loves, and like it becomes one of the top foods in that store, then of course you can negotiate your fees. You can negotiate whatever you want. You're going to sell a huge, huge [00:04:00] volume. So of course you're going to be profitable longterm and all that activity will help you get into other stores, but that's rare.

Most of the time, what happens, people break even or lose money and they kind of quit. So most of the products you see in these big supermarkets, they're just by big companies because small companies have like a really hard time breaking in. Even if they get lucky enough to get upset, accepted into the big stores.

So often the strategy might be that first you sell online, turn your business into a brand that then you can leverage to negotiate better rates for yourself and have an easier way to get accepted into stores so that you actually can become more profitable selling in stores. So that's more of a long term strategy for most cases today, the stores.

Short term is the online sales.

