Most supermarkets and large chain stores have an instore bakery that offers shoppers similar products to those of the retail bakery. However, while the instore bakery at the supermarket is highly competitive with the retailer, there are those products that it can’t compete with. Also, the retail bakery can produce in a different way than the supermarket bakery due to equipment, kitchen set-up, etc.
Call on supermarkets and make them your customer rather than trying to compete with them on price. Figure out a way to sell to them and make them your ally. Use the supermarket as a tool for not only creating additional revenue, but also to get your product in front of customers who might not shop in your retail location(s).
Stake Out the Stores
Before just blindly trying to pitch supermarket managers on your products, do some reconnaissance in an area that you are willing to serve. Once you find your area, take some time and visit all the potential supermarket customers in that area. The idea here is to see what their bakeries offer and figure out which of your products fits into their scheme.
If you produce an item that sells well in your retail store that an instore bakery does not offer, that’s the perfect opportunity to make a pitch to that store. Be careful not to try and do too many different products for different stores. Getting too complicated, too fast might lead to trouble. When starting out, find one or two supermarkets and try to sell them one or two products.
If you find an independent grocery store that seems like it could benefit from your products find out who you need to speak with and set up an appointment. Try to remain respectful yet persistent. Managers and owners get very busy throughout the year and often need a reminder that you’re interested in speaking. The trick is to continue to follow up without becoming a nuisance. This is something you’ll have to get a feel for and manage on your own.
Once you have a meeting set, prepare accordingly to make the best pitch you can. “Don’t go in cold,” says Mikal E. Belicove, marketing and management consultant, author, and contributor at www.entrepreneur.com. “Show that you have loyal customers and tell the store buyer what you've already achieved in terms of success.” Have solid numbers on the product you think will fit into the supermarket’s bakery. Most importantly, show sales figures and be willing to help with marketing.
While maintaining the integrity of what makes your product a viable candidate in the grocery store, try to show potential customers that you are willing to work with them and be flexible in certain areas. Whether it is packaging, merchandising etc., try to remember that gaining the account is the most important thing. The loyal retail customers at your shop will always come to you for their needs. Do what you can to help the supermarket sell your product(s) in their stores as well.
Going After the Big Dogs
Bigger, national grocery store chains such as Kroger and Whole Foods will not meet with you unless you have a distributor, Belicove says. Distribution deals are critical in the food and beverage industry. One thing to remember, going after the biggest and best distributor first thing will probably not get the results you’re looking for. Instead, find a good distributor that is willing to work with you and get you going in the wholesale business. Once established, you can move on from there.
“Once you have the data, the charts, the proof, the graphs, a profit—that's when you make your move on the industry leader,” Belicove says. To get a deal with the biggest distributors, you must show them tangible proof that it’s a win for them to take you on and get your products into the bigger stores. Once you achieve this level, you’re on your way to increased revenues and limitless growth potential.
Just like with the independent stores, find a product that you produce—or that you can produce easily—that you target distributor doesn’t offer. “Every distribution company already has clients. Offer the one you want to work with something they don't have,” Belicove says. “Find the distributor that doesn't carry anything resembling what you offer, including your value proposition.”
Beyond the Bakery
Something to think about, your retail bakery products have the ability to fit into more than just the retail bakery section of the supermarket. Breads might also do well in the deli for sandwiches or in the foodservice department. Certain desserts might also be sold in the foodservice department. Think innovatively when preparing your pitch to a supermarket buyer, and again, try to remain open and flexible to get the sale.