4 Essential Steps to Winning with Buyers in a Product Line Review

Do you approach a line review as a chance to throw products at the buyer and see what sticksDo you approach a line review as a chance to throw products at the buyer and see what sticks?

In his recent blog, The Successful Big Box Line Review, Whizard Strategy’s Mark Mitchell tells building product manufacturer’s that instead of fearing a product line review, they should see them “as an opportunity to set yourself apart from your competitors.” Great advice for manufacturers but it’s only half the story.

In a line review, understanding what the merchant needs to win is as critical as to why you think you’re the best solution.

Are you just another product pitch to the buyer?

Are you just another product pitch to the buyer?Sadly, too many buyers tell me that what they want is someone who understands their challenges. Not another product pitch.

Like you, they have goals to grow the business. To do more with less.

And, whatever their decisions, they have to successfully sell them to the leadership team. Which means not only do you have to deliver a compelling product proposition, you have to arm your merchant with the trends, data and research to show how and why what you believe possible, is possible.

Buyers want answers to these four questions in a product line review

Buyers want answers to these four questions in a product line reviewThese four points look easy and sound intuitive but they are tough to do. It takes time and preparation to answer each fully. And although they sound expensive – and can be – they really don’t need a lot of investment to do.

  1. Educate me on the market: who’s winning and who’s losing in the category – and why. Help me learn how to think about the category and my role in it.
  2. How do consumers shop the category? What’s important to them and why. Help me see product trends and show me how I can take advantage of them.
  3. What I need is newness and freshness. My shoppers are looking for me to offer innovative project solutions. They are coming to my store with a to-do list that I need to be able to completely satisfy. That means having innovation as well as basics. (It wouldn’t hurt if I could be exclusive or at least have a head start.)
  4. Help me be successful. Sure I have to increase comps but that may not be my biggest driver. It may be inventory or margin. How I get there is balancing many pieces across the entire department. Like you I don’t have unlimited resources.

Just because you educate your buyer doesn’t mean you are going to win

Buyers want answers to these four questions in a product line reviewLet’s be honest. If you come to me with research, insights and good analytics, you are arming me to be able to defend my decisions. It’s a good chance that you’ll see trends early and have products that reflect them. That helps me but it doesn’t guarantee placement. I often need to prove something works.

Your competitors all want the shelf space. They are telling me how you come up short and highlight where they are strong. Maybe they have a better brand name or maybe they’re willing to be own brand. Your approach isn’t always the best or only approach and selling harder isn’t the answer.

More importantly, I know that too much change is equally dangerous. I’m stuck with old inventory, my shoppers are confused and I don’t see growth. Testing is my way of building a fact-based case. So don’t push me constantly for more stores (or more test, for that matter).

Bottom line? Manufactures need to educate their buyers with facts – not offer phrases like “I think, I hope and I believe” – to demonstrate that they are the category innovator and partner the retailer needs to take sales and profitability to the next level.

Good Selling!


Are You Ready For Your Product Line Review?

Are you ready for your product line review?The line review process is a validation step for the retailer. Remember they are ultimately confirming that they are offering “the right product, sold for the right price, at the right place and time.”

The goal of the Product Line Review process is to ensure that your customers have the most competitive and compelling assortments available at retail.

To properly evaluate this, retailers routinely ask the primary manufacturers in each product category to educate them on the market opportunity, their company, products and go-to-market distribution strategies.

You are the expert in your product categories, not the retailer

As a supplier selected to attend the review, you are being asked to give open and honest feedback on the retailer’s current retail assortment. This feedback should include product, pricing, promotions, packaging, merchandising, logistics, services, and any other attribute that will assist them in growing their sales,  profit and market share while minimizing space and inventory investment.

You are the expert in your product categories, not the retailerA meeting with the retailer should include the following in a Product Line Review:

  • Company history
  • Financials
  • Capabilities and capacities
  • US total category size
  • Company market share within US market
  • Category market share by channel of trade
  • Suggested product assortment mix and pricing
  • Plan-o-gram (POG) set, point-of-purchase (POP) material and merchandising ideas

Once you and your competitors have had the opportunity to present their proposed go-forward business improvement strategy, the retailer’s merchandising team will make the decision as to which supplier(s) will be awarded the business based upon predetermined criteria which often includes components like these:

  • Management attitude and commitment to build a strong long-term relationship
  • Supplier’s ability to service, support and grow the business*
  • Product quality, innovation, design and exclusivity opportunities
  • Supplier market share and their ability and passion to help grow with the retailer
  • Current performance indicators, if applicable
  • Absolute best cost/value relationship

The typical Product Line Review is conducted in three steps

STEP ONE – Pre Line Review

All invited suppliers are sent an electronic file that often includes the following documents:

Confidentiality Agreement – Due to the sensitivity of the information being shared, suppliers are generally required to execute a Confidentiality Agreement. This ensures that your information will not be immediately placed in your competitors hands.

Product File – Before the actual PLR meeting, suppliers usually are asked to complete a standardized spreadsheet related to the existing assortment and add any new or non-comparable products deemed necessary to complete the new recommended assortment along with recommended invoice pricing. The file can also include:

  • Vendor contact & ordering information
  • Market share statistics
  • Advertising programs
  • Current item assortment and pricing (including any assortment adds or deletes)

Lately, retailers have wanted pricing to be quoted as Net/Net. This allows an apples-to-apples comparison between suppliers. Net/Net is defined as the retailer’s net cost, excluding all other added costs such as freight to their stores, distributions centers or cross dock facilities, payment terms, rebates or other back-end funds, marketing or co-op funds, over and above money, promotional funds, slotting fees, defective allowances, etc.

STEP TWO – Product Line Review

Here’s what retailers are looking for in a line review presentationSuppliers that have successfully executed step 1 of the Product Line Review process are invited to the retail headquarters to meet with the merchandising team.

Power Point Presentation – Generally, you will have 60-90 minutes to present your recommendations. The retailer wants to be sure they are offering “the right product, sold for the right price, at the right place and time.”

Here’s what the retailers are looking for in a presentation: 

  • Company Profile – This should include all necessary information to get a complete understanding of who you are, what you do, where your products are manufactured, distribution centers, company financials and management team.
  • US Market Share information – This should include any relevant information that would help us understand the total size of the category being reviewed (in US Dollars). Your company’s share, your competitors’ share, your retailer’s share and their competitors’ share of the retail, wholesale and direct markets and any other market share or industry information that may help them make a more informed decision.
  • Product Information – Educate the retailer on your products and programs, new technologies and innovations, and why you believe they should be stocking your products versus those of your competitors. Explain how your company can help them differentiate their assortments from those of our competitors.
  • Marketing and Promotional Plans – Show the retailer what we can do better and how you can help us drive more customers into their stores.
  • Competition – Provide retail price shops from the retailers that sell the most products in the category under review (these retail competitors should be agreed upon by both the supplier and the merchant). Help them understand what they need to do to be competitive in today’s marketplace. Educate them on marketplace best practices, success stories and any pitfalls to be avoided.

Recommended Product Presentation – All suppliers attending the Product Line Review will also be required to set up a plan-o-gram (POG) of their recommended retail assortment.  A POG is a visual representation of where and how to place products on your shelves in order to maximize sales.

This is a critical part of your Product Line Review story.  A good POG is based on historical sales data which indicate which products are the best sellers and which products work well when placed together – for example in improving impulse sales.

Discussions should surround how the newly recommended assortment is merchandised to help customers make an easier, more informed buying decision. Explain how the good-better-best sell-up strategy works and how the packaging and point-of-purchase materials tie the program together.

Ultimately, you must demonstrate how the new POG will improve the sales and merchandising the category while still meeting all the shoppers’ expectations of selection and price.

Decision Process – After all supplier presentations are completed, the retailer merchandising team will select its go-forward supplier partner(s) for the product category being reviewed.

Once a supplier has won a category line review; they will remain our supplier partner of record for the foreseeable future provided they continue to perform.

STEP THREE – Post Line Review

Often line reviews are completed a full year ahead of when the store transitions will be made. However, you will begin working with the merchant team to review, design, develop and implement the following:

  • Establish the final assortments
  • Finalize all retail pricing
  • Determine store counts
  • Develop or update all needed signage and  POP materials
  • Finalize logistics
  • Execute agreed upon discontinued inventory exit strategy
  • Implement new plan-o-gram(s) into retail stores
  • Train store associates to the benefits of the new program

Can you avoid the Line Review Process altogether?

Can you avoid the Line Review Process altogether?The line review process is a validation step for the retailer. Remember they are answering to their management team that they are meeting the corporate goals, aware of the market dynamics and pricing and ultimately answering that they are offering “the right product, sold for the right price, at the right place and time.”

That said, the Product Line Review process can either intense or a “softer” business review. If you focus on be a top supplier, you may be able to avoid highly competitive line reviews. Being a top supplier means:

  • Keeping the retail partner competitive by providing the best possible products at the best possible price
  • Consistently shipping on-time and maintaining an above average unit fill-rate
  • Establishing mutual annual business plans to effectively drive sales
  • Introducing your retail partner to new products and programs before full market introduction
  • Updating and maintaining plan-o-grams including packaging and POP materials

Bottom-line, by taking complete ownership for the success of your products, programs and overall business, you can win and maintain your business with the biggest and best of the retailers in the marketplace.

Good Selling!

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5 Tips to Succeed with Big Boxes

5-Tips to Succeed with Big Box HomecentersMaybe you already sell either Lowe’s or The Home Depot or both. Maybe you eat channel conflict for breakfast. But it’s been my experience that the continuous competitive clash between orange and blue is something that is tough for many manufacturers’ to figure out.

Selling one or both of the home center big boxes is a great way to drive volume.  Each, however, works hard to differentiate themselves from one another.  That makes it had to sell both of them when you have a commodity category.  But it’s still possible to do this without being a major consumer brand.

To sell a big box chain, you need to think and act like a big consumer brand – not spend like one

You do have to think and act like one of the big brands. That means not being a product expert alone, but a marketer who’s expert at driving the business (see the Channel Instincts post Are You a Marketer or Just a Product Expert?).

5 tips to help you win in a big box product buyer presentation5-tips to sell both Lowe's and Home Depot

  1. Do your homework. Visit the stores in both chains. Know what the competitive products are and how they’re merchandised and priced. Talk to the associates and department manager of your category.  Find out what’s working and why. And ask about what kinds of issues they are seeing. You may be able to uncover a pain point that will resonate with a buyer.
  2. Be the expert in your category. Pitching your product is almost the least important part of your discussions with buyers. Instead, you need to be clear that you know what’s going on in your category and have unique insights that will help the big boxes driver sales. Don’t walk in with secondary research and expect to get taken seriously. You’ll need primary research to really get attention.
  3. Have a marketing plan, not a sales pitch. Be a partner for growth. Share how you are going to create excitement for your category with your product and brand plan. Be able to clearly differentiate your product from everyone else. In other words, answer the question of “why should I switch?” If you can, show how you will bring them innovation or exclusivity (maybe in the form of a head start). By the way, exclusivity always comes with reciprocation.
  4. What’s Wrong with Lowe’s and Home DepotUnderstand the needs of their shopper. Lowe’s and Home Depot are not alike! You must dial in on how you are going to meet the shopper’s needs. For example, the pro makes up around 40% of big box home center sales – how are you reaching the pro? What about the DIY-er and DIFM groups? If you don’t know what these terms mean (“do it yourself” and “do it for me”), you’re not ready for your meeting yet.
  5. Getting on the shelf is only a first step. Now you have to show you can drive sales off the shelf. You need to have more than a lower price. You need a promotion plan that will get you featured in a tab with secondary placement. You also will need a powerful package design that is compelling as a silent salesman. Because finding an associate isn’t easy and they know even less about new brands and products.

Sell Lowe's and Home Depot SuccessfullyRight product + right price + right sales team = Success

I don’t want to oversimplify the competitive nature of selling into a big box account successfully. It takes a unique combination of the right product at the right price. Having the right sales team is critical as well.

But it will all fall apart if you do all those things right and don’t have a strong plan for driving the buyer’s metrics for growing the category.

Good Selling!