In the U.S. domestic market, major national chains, particularly super stores are dominating the retail scene. Their focus is on "first tier" manufacturers who have developed consumer acceptance. Not only must your product(s) be unique, but you must also create consumer demand to assure your placement and sell-through with these major accounts.

In recent years a strong trend has emerged toward consolidation in retail. Consumer electronics, computers, office products, toys, and hardware are now dominated by a few key retailers. In other words, The Big Guys rule! The good news is if you secure one of these major accounts you have overnight national distribution. The bad news is the process for securing that business is far more complicated and potentially costly. Let’s see how ABC Gizmo Manufacturing approaches these accounts.

So you’ve got this great new gizmo that everyone’s going to need. You want to sell lots of them, fast. Who will give you a large volume of business in a short period of time? How about those big super stores; office super stores, computer super stores or maybe the big chains. Stores like Staples, Office Depot, Best Buy, Circuit City, Walmart and Target.

It sounds like you’re on the right track. Get one or two of those big guys and you’re set! "They really need my new gizmo because (A) its cheaper than the competition’s, (B) looks better, (C) does lots of neat things."

"I’ll just make a few phone calls set up some big guy appointments and since I’m such a good salesman, it’s a done deal!"

Wrong, Mr. Gizmo maker! The big guys are not waiting for you to show up at their door. They don’t know you, they don’t know if your product will sell or how your product will impact existing vendors.

Here are some of the pitfalls to avoid:

Cheaper is generally not interesting to a buyer, unless you have a new process that makes your product significantly cheaper. The buyer may just assume you have removed some quality from the product or worse, he will use your price to extract a better price from existing vendors. The buyer is almost always more interested in rapid turnover of product and profitability, rather than price alone. Generally, a strong brand name will meet those objectives more handily than a lower priced off-brand.

Looking better is subjective. If you have a calculator with a stylish case, it’s still a commodity product that won’t readily replace existing vendors.

Doing lots of "neat things" or multi-functions is difficult to understand in a self-service environment or in a typical 2" or 4" newspaper advertisement. It is more important to focus on that single feature that will motivate the consumer to buy.

Here are a few solutions to the above scenarios:

Realize that an initial order to a new vendor quite often is treated as a guaranteed sale until the buyer is satisfied that your product has sold through successfully.

Make certain your price structure provides the retailer with above average profit margins in order to interest him in your product. You must also allow for sufficient profit margins for you to afford sales commissions, product returns, prepaid freight, payment terms, volume rebates, and finally co-op advertising expense.

We didn’t say selling the Big Guys would be easy, but if you can secure their business on your own terms, it is well worth it.