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When choosing a brand, it’s not about just looking pretty on the sales floor; it’s also important to know more about the product and how it can best fit your store needs. You need to know about Policies, Protection, and Potential. This list of questions will open up conversations with your brand reps and help you make the best decisions for your customers and business.
Depending on the size of your market, it may not affect you much to carry the same brands as other stores that are miles away. But if you’re in a small town, it could be detrimental for you to carry the same product as your competitors. Depending on your competitor’s target market or styles, it might still be perfectly cohesive for you to carry the same brands, but overall, you’ll want to carry unique products to the area that a customer can’t get somewhere else.
Most vendors/brands have an archive of retailers they sell to. This would be the very first question to ask when walking into a showroom or inquiring about a new line. Within minutes, they can tell you who is writing, when someone stopped writing, and who is thinking about writing the line. You do not want to waste any of your time looking at a brand that you know you will not carry.
Some brands are able to offer you exclusivity. If you have exclusivity though, make sure that you are able to dedicate a reasonable amount of your budget to this brand. Expecting or demanding exclusivity must be justified and a benefit to all involved; including the brand.
This is your follow-up question for your brand reps; what is your corporate territory policy? Most companies have a set mile radius in which you allowed to be the only store to carry their brand. The companies have requirements that your rep can tell you about that keep you protected; these can include order quantity minimums, dollar minimums or quarterly minimums. Some lines will not offer you territory protection, but it never hurts to ask!
Margins can make or break your profits. A company’s Manufacturer Suggested Retail Price (MSRP) sets this margin. The brand will be selling the product with this MSRP on their website and in other stores. You do not want to be caught with a different retail price. An average mark-up is 55-62%. If a company’s MSRP is on the lower side of this percentage, you will need to carry “margin building” brands to make up for the minimum profit. A “margin builder” is a line that has a very low cost with a large markup; these brands do not control or have a set MSRP.
Open packaging is when you have the choice of sizes and quantities to order for a select item. Bulk packaging is when a company has pre-decided the sizes and quantities when selling an item. The reason this is important is that, depending on your business and the product you sell, different ordering options can be more beneficial for you. If you are a clothing store, you might prefer selling a line that offers open size packaging because if a shirt is running small, you can order more quantities in larger sizes. If you are a floral shop, it is important to find flowers, vases, and accessories that are sold in bulk so you can lower shipping costs and increase your profits.
You have a set amount of time in order to contact a brand rep about product you received damaged, faulty, or is just not selling. Many have a 30-day policy. Within these thirty days of the invoice date, you will need to contact your brand representative with an explanation and proof of the damaged product. It is important to know this policy because you might not want to work with a brand that does not stand behind their own product or offer flexibility. Excessive damages and ill-fitting clothing can be detrimental. Nothing is perfect, but you do need product protection to prevent profit loss as much as possible.
We are all working towards the same goal. With this in mind, many companies offer programs with benefits and incentives. Never be afraid to ask your reps if the brands they carry offer any of these!
Net30 Terms – This means you have 30 days to pay for product once received. This allows you time to sell most of the items before having to pay for them, which can be a huge benefit to your cashflow if monitored and used correctly.
Rebate – This would be considered a rewards program. If you spend a large dollar amount with a company, you may be eligible for a small discount on shipping or product in the future.
Trunk Shows – This is similar to consignment but with different intentions. You will select additional inventory from a brand to be sent to you for a few days in order to show customers. This product can be slightly more adventurous than what you normally buy because you will be sending it back. Many brands send you samples, which means customers will not be walking out the door with the items they purchased in hand. You will put together an order form and let customers know when the items have arrived at your store.
Brands are always putting their logo on promotional products. Ask if they have anything they can send you. These items should be free or very inexpensive, making it perfect for giveaways and swag bags for yearly events. Also, ask for promotional marketing. Some companies will send you professional pictures and printouts to use in your marketing.
Whether you are just starting out in your retail journey or are a veteran seeking new brands, asking these questions will ensure that you are maximizing the brands and selections you bring into your boutique.