Retail Vendor Strategy
As we race towards the holiday season, many retailers are focused on doing everything they can to get and keep customers in their stores. With the continued growth of ecommerce across the retail landscape, there are more and more vendors (i.e. those who typically focus on wholesale and supply products to their retail partners) who are becoming “retailers” in the sense that they are selling direct to consumers via their own websites. We hear from clients on both the retailer and vendor side about this inherent “conflict”. However, we know that after reading this article – and in the spirit of giving – building retail vendor relations won’t seem nearly as daunting.
We really appreciate that many vendors are often very sensitive to the business needs of the retailers that sell their products. It is those stores that have, in many cases, made them successful and helped to get their name out there with consumers, and by all means they should respect that.
At the same time, it is their own company and they need to be in control of it and its destiny. While vendors are always trying to find new stores to add to their network, they should also be exploring other channels to sell through in order to keep their brands relevant. If they don’t, they run the risk of having put all of their eggs in one basket and have become TOTALLY dependent on retail partners to drive their business.
So as a retailer, how do you deal with this dynamic? For starters, embrace the fact that vendors may be selling the same product that you are carrying in your store. We live in a multi-channel world and instead of complaining about it, work together as retailer/vendor partners to create more sales for everyone. Recognize that if a customer is in your store, you have a lot on your side in terms of creating a sale such as instant gratification factor, no shipping cost, personalized service, etc..
If you are unable to sell a product because the vendor also sells it on their site, you probably have bigger problems than multi-channel availability. Ask yourself, is the product merchandised strategically? Is it easy to find and accessible and put into context for consumers? Is it priced fairly? Do you have ways to special order products for customers if you run out of a style or color so that you are still able to get the sale? If so, is this overtly messaged to customers so that they don’t automatically leave the store empty-handed when something is out of stock? Be creative with your solutions and keep that customer in your store and give them other reasons to come back to your store in the future.
Retailers shouldn’t be scared of competition from their own vendors but see it as opportunity to help increase sales for everyone. If a brand is selling well, everyone involved wins, no matter what side of the store they are on.