After all the hard work of taking a product from dream to reality, entrepreneurs must face another huge hurdle: how do I get my product on store shelves?
That requires grabbing the attention of a buyer and getting that coveted purchase order. Sales reps are experts in this field, they see thousands of products a year, and only a few stand out. To make the cut with them, and eventually the buyer, your products have to excel at the 4 P’s: Problem, Packaging, Price, and People.
1) The Problem
Does your product solve a problem? This classic question is still number one for a reason: it matters. The world is full of products, and if a new one is going to crack through, it has to have something special going for it.
Sales reps and buyers have two categories of problem-solving.
1) It Solves A Straightforward Problem
This one is simple enough. When you hear what the product does, you realize it solves a problem, whether you were aware you had that problem or not. This problem can be serious, trivial, or somewhere in-between. Solving a straightforward problem is a great way to get customers, especially if they’ve never seen a solution as good as yours before.
2) It Solves A Unique or Innovative Problem
Some problems are more abstract than simply wanting paper you can write on in the shower, and that’s fine, even if the problem isn’t immediately apparent. Sales reps and buyers are also very interested in products that answer more significant, more amorphous questions.
If your product doesn’t solve a straightforward problem, it’s worth thinking about what unique or innovative problem it could solve. If you feel stuck at this stage, stretch your imagination and see if your business could be modified to solve a problem. Even if you’re never asked directly what problem your product solves, people will be thinking about it and judging your product on this metric anyway.
Another way to think about what problem your product is solving is to think about what makes it different than any other product currently available. People will ask you directly what makes your product different, and merely saying, ‘I own this one,’ won’t be an impressive answer.
2) The Packaging
After sales reps and buyers make their judgment about your product, they’ll turn to what everyone will see first: its packaging.
Since you can’t be physically present to talk to every possible customer, your packaging has to speak for you. It tells the consumer what the product is, and gives them dozens of context clues to figure out if they want to make a purchase.
Sales reps and buyers will always ask themselves the same few questions about your packaging:
- Is it clear and simple, and not bogged down in tiny text?
- Does it make a good impression in half a second?
- Does it match other products, but also stand out enough?
To succeed in these questions, your packaging will need to be stylish and communicative. When designing your packaging, ask yourself if it answers the following questions:
1) What’s the product?
The most important question for your product. Make sure that it’s so obvious that all of the following people would know what your product is at a seconds glance.
- A child
- A stressed-out parent dealing with a child
- Someone with impaired vision
- Someone who doesn’t speak the language
2) Who’s The Customer?
Customers will try to figure out if they’re the right person for this product. Does your packaging answer the following questions?
- Is it high-end, mid-range, or affordable?
- Is it eco-friendly?
- Does it have a target customer age or a target stage of life?
3) Does It Look Professional?
This might seem obvious, but it’s worth stating over and over again: professionalism counts. Don’t fall into the entrepreneur hole of thinking that your product will speak for itself so that you can cut corners on packaging.
There are a ton of other design guidelines you’ll want to follow for packaging, but these three questions are a great place to start.
3) The Price
If reps and buyers love your product and its packaging, the next thing they’ll focus on is price. Your price has to be functional: high enough to make a profit, and low enough to sell units.
While both reps and buyers can help you in some areas, and may even require you to change your prices before they do business with you, you should come ready with numbers and data to back up your current prices.
So how do you decide price? The first step is to understand your costs fully. There’s no getting around it, price is all centered around your costs, because of the basic principles of doing business.
Businesses need to make money to survive
- Businesses cost money to run, and they earn money by providing goods and services.
- In the long term, businesses need to make more money than they spend, or they’ll go out of business.
To calculate how much money you need coming in, you have to calculate how much money you have going out.
Start by finding your fixed and variable costs. Fixed costs are expenses that do not depend on the number of goods or services being made by the business.
Examples of fixed costs are:
- Salaries (if people are working whether or not you’re busy)
You’ll also need to find your variable costs. Variable costs are volume related, if you make a lot of product one month your variable costs will be higher.
Examples of variable costs are:
- Raw materials
- Salaries (if people only work when product is being made)
Once you have a comprehensive list of your costs, it’s time to research different pricing strategies and see which ones seem like a good fit for your industry and company.
There are a ton of different pricing strategies, and only a few will be right for your company, but it’s worth exploring:
- Cost Plus Pricing
- Value-Based Pricing
- Market-Oriented Pricing
- Dynamic Pricing
- Price Elasticity
- Discount Pricing
- Loss Leader Pricing
- Psychology Pricing
Once you’ve decided your price and your price strategy, remember that it isn’t set in stone. Feel free to experiment with your price until it’s optimized to get the best sale/ profit combination.
4) The People
After all the logistics and math, there’s still a hugely important factor that buyers and sales reps think about before going into business with a company: the people.
It’s typical for it to take eighteen months from when a product is first accepted to when anyone sees any money from it. With a sales cycle that long, reps and buyers want to make sure they’re dealing with someone they are willing to be around for a year and a half at least.
Most people are just looking for someone who can be professional and responsible. If you’ve provided a great answer to a problem, proper packaging, and have a reasonable price, you’re already most of the way there to proving you’re worth investing in.
However, personality also comes into play. There are going to be many difficult questions to answer and hurdles to overcome. Do you give off the impression that you’ll be a good person to be around when the going gets tough?
Are you flexible, but backboned? Are you polite, but confident? Is your communication prompt and clear? Basically, do you seem like someone it would be pleasant to be in business with?
Getting your product ready to be bought or repped is a ton of work. If you need any help figuring out how where your product is in the process, and how to get it to the finish line of the 4 P’s, consider hiring a sales rep as a consultant. They’ll be able to give you valuable insight and specific directions to go in before you start your retail journey.