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Selling your product
Catalogue marketing for your product
Thinking of selling your product or invention through a web catalogue? You know, you go to them with your product and they then sell it for you on website? Here are some key things you should watch out for as you begin to sell.
Giving away the farm
Many sellers will ask for a multitude of discounts and concessions before they even place one order with you. You give them a set price for your product. But they insist on a lower price. They expect you to pay shipping. They want an 'advertising allowance'. They ask for a volume discount, a catalogue allowance and a photography fee. The requests for concessions go on and on. But beware of this game. If a seller truly likes your product, they will usually pick it up without requiring a ton of concessions.
Being stung by mistakes
Review a seller's rules and shipping requirements closely. Mislabelling your master cartons, late delivery or failure to follow any of their vendor requirements could cost you. Penalties are typically enforced through deductions off invoices. A few deductions here, a few there and you can kiss your profit goodbye.
Falling behind with orders
The only thing worse than having a product no one wants to buy is having one that so many people want you can't keep up with the deluge of orders. If you've never had insomnia, this scenario is guaranteed to cause it. When thinking about your production needs, think as optimistically as possible. Make sure you're capable of handling production if the catalogues are successful with your item. And always have back-up suppliers lined up - just in case.
Products that boomerang
Returns from catalogues are an inevitable part of the equation when figuring out your profit. If you have a good, well-built product that delivers on its promises, you have little to worry about. However, high returns are often the first warning sign that there are problems with your product. It breaks easily when posted, customers think it's overpriced or assembly instructions are confusing. Any number of issues can be red-flagged by high returns.
Placing your eggs in one basket
Many sellers ask for an 'exclusive'. This agreement guarantees that their website will be the only one carrying your product for the length of the exclusive. Generally, this is not a good deal for your company. Naturally, an exclusive with one company locks you out of the rest of the market. If you do grant an exclusive, keep it as short as possible. Six months is plenty of time.
Doing business with deadbeats
Let's face it, the main reason you do business with seller is so they will pay you for your product. How frustrating it is then when they don't live up to their end of the deal. And it happens. Like all businesses that are strapped for cash, when an online catalogue is experiencing lean times, they will delay payment to their vendors. So keep a close eye on when an invoice is due, and don't let them slide too far past the deadline. Any invoice more than a month overdue could indicate trouble. Your best recourse is to hold up shipments to that catalogue until you get paid. You can even ask for payment upfront on new orders.
Online sellers can give your business a big lift. Here are just some of the benefits.
Sell to a large market
Online selling is growing the world over - but particularly fast in the UK.
Compete more easily
Online catalogues offer a level playing field for the big corporation and the smallest start-up. With few exceptions, products are judged and sell on their merits, not on the reputation of the manufacturer.
Save on packaging
Unlike point-of-purchase sales, where the package helps sell the product on the store shelf, the package has no bearing on the sales of an item in a catalogue. So you don't need an expensive four-colour box. In fact, the simpler the packaging, the better. A plastic bag is often sufficient.
Keep your risk low
A few sellers now require a nominal 'advertising allowance' to sell your product. However, many still charge nothing to advertise your product.
Get national exposure
Catalogues offer start-ups and small companies exposure to millions of potential customers. When your product appears on a reputable website, your product and your company enjoy instant credibility.
Test the market
Catalogues provide an ideal opportunity to find out how well your product sells. In addition, when you place your product with specific niche sellers, you can test different segments of the marketplace.
Here are 14 criteria to judge whether your product has potential to be a winner. Although it's not necessary to meet all of these criteria, the more it meets, the greater the likelihood it will be successful in mail order.
- It makes sense. Upon seeing your product for the first time, most people would understand the value or usefulness of it.
- It's new. Ideally, the product should be fairly new with limited or no exposure at trade shows or in stores.
- It solves a problem. Your product solves a common everyday problem that's never been addressed before. Or it solves a problem in a unique way or a much less expensive way.
- It's unique. There's absolutely nothing like it on the market.
- It looks good. Your product photographs well. An attractive eye-catching photo works wonders for sales.
- It's simple. Your product has just one main function and solves just one problem. It takes less copy to explain a simple gadget than one with lots of bells and whistles.
- There's a widespread market. Naturally, the larger the catalogue market for your product, the larger the opportunity. Unfortunately, certain consumer markets, although big, are not necessarily big catalogue markets.
- There's a year-round market. The bigger the window of opportunity for your item, the better. It's usually more profitable to get steady sales throughout the year than to be limited to a short, seasonal market.
- It's safe. Ideally, your product should not be dangerous in any way: there's no risk, or at least limited risk, of injury to the customer and there are no small breakable parts for children to swallow.
- It's durable. Your product will easily be posted without breaking.
- It's easy to supply. There's an adequate inventory with a short lead time (less than four weeks) on production. Plus, you have back-up suppliers lined up, in case you need them.
- It's priced between £5 and £100. Ideally, the perceived value is over £5, unless the product can be sold in sets. £100 is an arbitrary figure, but nonetheless, there's a tendency that the higher the ticket price the less likely a product will work online.
- It's easy to post. If it's particularly long or oddly shaped, you can provide the product in a special box. Preferably, the product should also be lightweight. Naturally, the higher the price/weight ratio, the better.
- It's patented. Although it's not absolutely necessary that your product be patented, with a patent you can ward off knock-offs. The catalogues will also feel better about advertising your product if they know you are the rightful owner of the idea.
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