If you've just launched your brand, are considering doing so, or would like to switch to supermarkets, you're probably wondering about supermarket listing. And with good reason: it's the best way for a new brand to be considered in record time.
But without any knowledge of the organization and workings of the chains, prospecting can quickly turn sour. What's more, supermarket buyers are well-versed in negotiation techniques, and often enjoy a balance of power in their favor.
The good news? There's Sidely! And today, we're taking a look at the techniques that work to get your products on the shelves of major retailers.
While you may be tempted to believe that e-commerce is the most direct way to reach your customers, or that you want to avoid sharing your margins with retailers (30% on average, no less!), the fact is that the French still shop in supermarkets. In fact, it's estimated that supermarkets account for 70% of all food-related purchases!
And that's not all: the success of mass-market referencing generally translates into three benefits for companies:
Whatever the distribution method you choose, mass retailing enables you to reach a very wide and varied public. This makes a major contribution to building brand awareness and, if successful, maximizing sales.
The large quantities you need to produce to meet demand often enable you to achieve economies of scale in manufacturing, logistics or distribution. As a result, your unit costs fall, making higher margins possible.
Whether you use centralized purchasing or independent suppliers, procurement is simplified by delivery to distributors, who take care of the following stages: warehousing, shelving and, in many cases, promotion.
But, as you'd expect, getting listed with a major retailer isn't that simple. It's important to understand what's at stake. In fact, getting listed in supermarkets requires robustness and a great deal of management work. You need to understand and master all the elements before and at the time of negotiation, know what you can and cannot accept in your contract, and identify the chains that are best suited to your brand and your products.
Here are some useful tips from Sidely to help you do just that.
Supermarkets are proving to be an essential channel for FMCG products that want to maximize their sales opportunities. However, the main objective remains to sell YOUR products.
So let's take a look at the crucial aspects you need to master to achieve this.
First and foremost, it is important to understand the difference between independent and integrated brands:
+ The independents: they have genuine autonomy over the choice of products they stock. These include Intermarché, Grand Frais, Système U and Leclerc. So you'll need to canvass them one by one to gain positions on their respective shelves... If your products perform well, you may later be referenced at regional or national level.
+ The integrated ones: these, on the other hand, refer to their central purchasing offices. If you hope to find your products on the shelves of Auchan, Monoprix or Carrefour, you'll need to canvass the buying groups of these major retailers.
Choosing a distribution channel is also essential to achieving your objectives. Launching brands can be highly sought-after by certain retailers, who, in exchange for your listing, demand exclusivity for your products.
For new brands seeking to maximize their visibility and sales opportunities, it is advisable to target both integrated chains and independents. This bimodal approach covers a broader spectrum of the market and optimizes the chances of success.
However, it is crucial to understand that these two types of chain operate differently, and therefore require different strategies. With integrated chains, negotiation takes place at a central level, which can represent a major challenge, but in return offers potential access to a wider network of outlets. It is essential to prepare your offer well, and to highlight the added value of your products to convince central purchasing agencies.
On the other hand, approaching independents requires a more personalized approach. Dialogue takes place directly with store managers, which can facilitate the establishment of business relationships and provide a better understanding of the specific needs of each outlet.
Although this bimodal strategy may be more complex and require a greater investment of time and resources, it opens up a wider range of opportunities and can make a major contribution to your brand's success in the retail sector. However, it's important to carefully weigh up your efforts and adapt your approach to the specific characteristics of each type of retailer.
It's important to note that being referenced as an independent will help you to be referenced by a head office, since you'll be able to back up your sales pitch with data.
In exchange for the benefits of your supermarket listing, you will often have to contend with a gross margin of 30% applied by distributors (on average). The impact on your profitability needs to be studied, as a sales price is not infinitely extensible. As a result, high sales volumes are generally offset by lower margins.
With pressure on your margins and the competition vying for your shelf space, it's crucial to quickly prove the appeal of your products to consumers. To do this, we recommend that you negotiate - even temporarily - the presence of your products at the head of the aisle right from the start of your distribution contract. This will encourage test consumption of your products. Sales from the back of the shelf will come naturally if consumers like your products and approve of their price level.
Defining your commercial and financial objectives will help you prepare for negotiations with the various brands.
To get your products listed, you'll need to pitch your brand! You'll need to be convincing, and give distributors the impression that they'll be able to make a profit thanks to you.
So let's take a look at some of the areas you'll want to work on!
Novelty generally attracts retailers. This is particularly true of Monoprix, which, to attract new entrants, tends to impose an exclusivity contract in return. Innovation can earn you points! Especially since every time a product enters a department, another one is bound to leave...
If your product doesn't innovate in terms of taste or composition, concentrate on the packaging and any other element that might arouse the interest of the consumer and, consequently, the mass-market buyer.
Another possibility is to work on a more aggressive price offer. It's all about finding the right balance between an attractive price for distributors, which will enable them to anticipate high sales volumes, and a price that ensures your profitability. Don't forget that your distributor wants to sell more: make sure that his margins don't cancel out your low-price strategy. After all, they too want to maximize their profitability per linear metre.
If you already have a certain track record in the direct marketing of your products, try to make the most of the key figures.
Furthermore, your potential resellers will be particularly sensitive to a product driven by a growing market. The same logic applies to a rising trend in your product category or range.
The frequency with which your products are purchased is also an asset that you can emphasize, if necessary, as it contributes to a high turnover on the shelves. If you sell your product via e-commerce, or are already referenced in other chains, use the figures to prove that your product sells.
The grail is, of course, the product that motivates people to visit: if your brand alone brings customers into the store, bingo! If you've managed to get listed in the first few stores, then you've got the ability to prove it. If you can demonstrate that your product is attracting new customers to the store - in other words, gaining market share in its catchment area - you'll have a significant advantage.
If you're not yet listed in any chain or store, you can demonstrate that your product can perform in a superstore, by showing that it can perform in its market. A comparison with competing products can influence the buyer: there's nothing like a clear, concise table presenting key figures or competitive advantages to dismantle your beloved competitors! Show that, with equivalent shelf space, your product will enable your distributor to increase its sales or margin.
Demonstrate your communication and media plans: your marketing efforts will draw people into the store, and the floor manager or head office buyer will be sensitive to this. Suggest merchandising solutions to stores too.
Your performance on social networks will also be considered, as will your collaborations with influencers. After all, your distributors always hope to benefit from their partners' com. It's a bit like the logic of cost transfer: you buy visibility on the web, they win customers in store!
And don't forget to highlight your awards, labels and other certifications. For the buyer, all these validations by third-party and independent organizations are arguments that could convince consumers to let themselves be tempted when they go shopping.
Likewise, adapt your products to current and future consumer trends. In the food industry, the trend is to go natural! To stand out from the crowd and increase your chances of being sourced, work on this notion of respect for the environment in all its forms.
Knowing how to adapt your products to increase your chances of winning over customers is also proof of your sense of strategy! For example, some food brands can play on naturalness, which engaged consumers are particularly fond of. Others may choose to adapt their packaging to a particular region or calendar event. The key word? Sense the market and be bold!
At some point, you have to show your muscle...
Want to prove that your products belong on the buyer's shelf? Show the results you achieve through your own channels:
-> Direct sales in e-commerce and in independent and direct stores ;
-> Performance on online marketplaces ;
-> Crowdfunding in the past.
It's also a way of showing your interlocutor that a target clientele already exists, which will encourage in-store purchases. What's more, your past successes give you the image of a successful management team, which will know how to find the keys to commercial success in the future.
At the heart of the referencing system lies the art of selling!
Work hard on discovery: salespeople's weak point is often their natural propensity to argue... Against this bad habit, the best salespeople are those who master the art of discovery. A buyer may have many reasons for sourcing you, and if you want to hit the bull's-eye, always start by trying to find out what's at stake.
For example, if your product is part of an ageing department, your brand can act as a driving force for the whole area concerned. By identifying the buyer's objectives, your area manager can build an adapted and effective sales pitch.
This means that your sales staff need to know both consumer buying behavior and the challenges facing department managers (or, more often than not, the company's policy!). Don't forget: adapting your sales pitch to the person you're talking to is one of the best-kept secrets in sales!
It's important to know that it can take up to 6 months - and sometimes even longer - to list your products with a major retailer, depending on a number of criteria, such as your listing strategy, the sales force you have available for appointments, and the geographic area you aim to cover.
This means that GMS SEO can become a real marathon. And if you consider this timeframe, as well as the structural differences between independents and integrates, it's clear that many commercial events will disrupt your strategy throughout the SEO cycle.
But, as we saw above, retailers are extremely sensitive to what's going on in their competitors' stores... Conclusion: don't hesitate to play on the heartstrings: if you've succeeded in integrating certain stores, you can use these initial victories to influence your next contacts. Your shelf-reading application can then be used to confront the buyer with the data collected from his neighbors... It stings!
Be careful, however, not to be too aggressive in your approach: establishments have their own distribution policies. The valuable KPIs at your disposal enable you to support your arguments, not condescend to the buyer.
As you can see, using a CRM is essential for prospecting, and the retail sector is no exception!
The point-of-sale database is a major component of your referencing strategy. To optimize your sales force's prospecting efforts, start by providing them with an up-to-date distributor database. Whatever your target's buying structure, fresh data is crucial:
-> If you're targeting the self-employed, the multiplicity of contacts means that your sales force can quickly turn into a call center... With a qualified, up-to-date contact database, your salespeople can be ten times more effective at making appointments;
-> With integrated companies, the purchasing function is centralized in a few key contacts: ask to speak to someone who left the company 6 years ago... You're toast, and your company's image suffers! Bye bye SEO...
For many companies, referencing in supermarkets is a key issue when it comes to increasing sales. But to succeed, you need to be prepared.
What we have just seen together in this article:
1) Understand how integrated and independent supermarkets work;
2) Define your sales objectives ;
3) Identify your strengths and establish a sales strategy ;
4) Train your sales force in the specifics of mass retailing;
5) Equip yourself with the right tools to turn your strategy into results.
And for those who manage to get on the shelves, the hard work begins. Being listed with buyers is all well and good, but it's only the beginning of the adventure: you need to maintain the link with each of your stores, and keep it up to increase and maintain your presence. And for that, you need a sales force in the field and a CRM: you need Sidely.
