How to Find Brands for Your Startup Retail Store and Why It’s So Difficult
Find the right brands for your store when you’re just starting out
It is often said that the first impression is the last impression. This is true for your start-up store too. When you are just starting out, it is important to make sure that you choose the right brands for your retail shop. That is why in this article you will discover opportunities to bring in good brands.
Furthermore, starting a store also requires a considerable investment. In addition to furnishing and rent, inventory is the largest cost item. That is why you would rather not have brands that do not sell well in the first phase of the company. Therefore, in this blogpost you will also find out how to choose the right supplier.
In this article we cover:
- The problem
- How other retailers include brands
- The solution
- 10 criteria of choosing the right suppliers
The Problem with Finding Brands for a Startup Retail Store
Why is it so difficult to find the right brands in the beginning of your retail shop:
According to a study
, startups are more likely to fail than they are to succeed. This is not because of lack of potential; it is because the challenges that come with starting a business are often too much for them.
High investment
The most common reason for startup failure is the lack of funding. Due to this, many businesses cannot afford to invest in advertising their products or services, which means that it becomes difficult for them to find brands willing to work with them.
No experience
This is one of the reasons why, finding the right brands for your store is one of the most important aspects of running a successful retail business. It can be difficult to find these brands if you are just starting out in the industry and have less experience.
No sales history
Last but not least, as a start-up retail store you don’t have much sales history. This is a problem to predict what brands and products will sell good and in which period they will sell. So you have less data for inventory optimization. This results in a greater chance of overstocking.
How do retail stores include their brands?
First, retailers look at the 10 criteria below this post to select good brands. In addition, as a retail start-up store, you have more objectives that you want to achieve with the composition of the range. For example, creating a cohesive theme within the store, which ties all of the products together. In addition, working with different suppliers in order to have a variety of products per price category and target group. Last but not least, focus on brands that are complementary instead of competing against each other.
Nowadays, retail stores should use brands on their website to increase conversion rates and to provide a more personalized experience for the customer. Brands can be included on a retail store’s website in many ways. One way is by creating a page for the brand and including products, images, and information about the brand. This way customers can see all of the products that are offered by that particular brand. Another way brands are used is by showing product images from different brands on one page and adding reviews and explanation to it.
Create a good, achievable plan to find brands for retail store
Probably the best tip we can give starting retailers is
; make a good, achievable plan.
This gives you the opportunity to involve suppliers. After all, it is a long-term partnership. So contact them and ask about the possibilities. If you have a bit of confidence in it, you can always start with a sample purchase. This way you can test it without running a high risk.
Furthermore, make sure that the brand is really represented in the store. Try to include sampling different products and merchandising the brands. Lastly, include in the plan how you expect customers to come back to the store to make another purchase. This convinces suppliers of the success of your retail store start-up.
The Solution to the Brand Finding Dilemma for a Startup Retail Store
There are options available to help with finding brands. One option is networking with other retailers and visiting fairs. Another option is finding brands on social media platforms like Instagram and Pinterest. Industry magazines also provide information about new brands that are available in the market.
We will briefly explain these solutions:
- Use wholesale marketplaces
- Start networking and get word-of-mouth referrals
- Check out Instagram and Pinterest hashtags
- Read industry magazines
- Visit fairs
1. Use wholesale marketplaces
Both B2B and retail businesses use wholesale marketplaces. You can use wholesale marketplaces to find suppliers, compare prices and make purchases for your shop. These platforms are growing in popularity.
Because suppliers also get an extra (online) channel to approach and find retail stores. The system can also make recommendations which brands and products are interesting for your company. In addition, they often offer an interesting payment term.
A few examples of B2B marketplaces
Check out this seperate article with a deep dive into B2B wholesale marketplaces
or check these few examples directly:
- Faire
- Ankorstore
- Helloabound
- Orderchamp
- Bulletin
- Tundra
- Indieme
2. The power of networking for finding brands
When building a new store, it can be difficult to find brands that suit the store’s needs. This is where (old school) networking comes in. Networking is one of the most popular ways to find the right brand that will represent your shop and your products. You can talk with other shops and brands which will help you find new brands for your new shop. That’s the power of word of mouth. The advantage is that you can immediately hear other opinions and experiences.
3. Find brands for retail stores on Social Media
Social media is a great way to find brands for your retail store. You can search on Instagram and Pinterest for hashtags of products you’re looking for. The first step of finding brands on social media is to pick the platform that you prefer. If you want to find brands on Instagram, then all you need to do is make sure that you have the app and then search for hashtags related to the products that you’re looking for. To find brands on Pinterest, all you need to do is make sure that your account is set up. Then search through pins with hashtags related to what you’re looking for or through specific boards such as “Clothing.” The advantage is that in this way you can directly measure popularity and discover new trends.
4. Industry magazines and news websites
Another way to find brands is to go through the latest industry magazines. The magazines are a good source of information because they have all the latest news and trends of industries. They also often provide more background information in terms of content. Furthermore, industry magazines give you an insight on what people are talking about in the industry and what they are interested in. You can also use news websites for this purpose as well, but it is more difficult to find good content on these sites as opposed to industry magazines.
5. Get inspired at a trade show
Last but not least, you can also visit branch exhibitions to find the right brand for your start-up shop. The first thing you should do is to have a list of brands in mind before going to a fair. This will help you know what kind of brands you want to find and what kind of products they offer. The second step would be to walk around and look at all the different booths with your list in hand. You will know when you have found the perfect brand, because they will be on your list and they will also have something that catches your eye. Do not forget to check the Social Media channels beforehand. Ultimately, the consumer decides and pays and this is a good benchmark. Because the brand representative always has a good story.
10 Criteria to choose brands for your retail store
Perhaps you are already very enthusiastic about some brands. You can’t wait to include them in your new retail store. Nevertheless, let’s take a look at what the best brands should offer to include them in store:
- Products that are the right fit for your target group
- Low initial investment
- Term of payment
- Promotion of your store
- Low competition locally
- POS material included
- Interesting profit margin
- Brand experiences
- Warranty and service
- Delivery times
1. Products that are the right fit for your target group
It is important to know what your target group is and what products they would be interested in. As a starting store, you may not have many customers yet. However, if you make a description of the ideal customer. Which brands and which products suit these people?
2. Low initial investment
You can ask suppliers if part of their range can be delivered on a consignment basis. Consignment is a retailing strategy in which a store sells goods on behalf of the brand, who retains ownership of the goods, but has them displayed and offered for sale. The consignor pays the store a commission for selling the goods. The advantage of this is that you have to make a lower investment in the stock. Of course, the profit margin will be slightly lower for these products, because the brand carries more risk. You can often return the products if they have not been sold.
Furthermore, this is a good way if you are just starting out and want to test the waters, before investing a lot in a brand.
3. Term of payment is important when starting out
You get more leeway if a brand uses a long payment term. At some suppliers you can only order again if you pay within two weeks. With others you can still pay months later. Of course every supplier appreciates it if you pay on time. This also strengthens the relationship with the supplier and as a result, he may help you through difficult times.
Nevertheless, a long payment term offers opportunities for your retail shop to sell more. For example, you temporarily have a higher marketing budget. In addition, you can choose to offer your customers a longer payment term. “Buy now and pay later” is a slogan that attracts customers.
4. Promotion of your store by a brand
Is the brand focused on the consumer with marketing and do they want to partner with physical stores? The best is of course if they want to promote their brand through the store. This way you can piggyback on their marketing activities and offer the customer the best offline experience. For example, if they do an online promotion in your area in which they promote that the brand is now available at your start-up.
Marketing is a vital part of any business. It helps to promote the products and services of a company and get them in front of the right audience. So this is where marketing support comes in.
Retail shops can use marketing support to promote their stores by using brand promotion, advertising, and events. Brand promotion includes promotional activities that are done by the company itself or in collaboration with other companies. For example, when Nike collaborates with Adidas to sponsor an event, they are promoting their own brand while also promoting Adidas’s product line. Advertising includes any form of advertising that takes place outside the retail shop such as radio ads, TV ads, print ads and social media ads.
5. Low competition locally
It is not always easy to find the perfect inventory
for your retail start-up. Therefore, you should take into account the competition that is present in that area. One of the best ways to do this is by checking out the number of similar brands nearby. For example, if many shops sell the same products nearby, it might be difficult for you to establish yourself as a new brand.
Furthermore, retail stores are facing a lot of competition from online shopping. The world is changing and people are shopping more and more online. However, there is still a lot of opportunity for retailers to open up shops with products that don’t have high competition.
6. Free POS material included
POS material is a valuable tool for any retail store. It helps the store to promote their brand and attract new customers. But what if you don’t have a budget for POS material? There are many free POS materials that you can get when placing a purchase order. This is a good way to start with your retail store start-up, because it has a low investment.
So in this way brand promotion doesn’t have to be expensive. Free POS materials is an effective tool for retail store owners to increase their customer base and drive sales.
7. Interesting profit margin
The retail industry is a high-margin business. A retail store has higher margins
than other businesses because it does not have the risk of physical inventory. So a retailer can make a lot of money by just selling products with a higher margin. The downside is that they have to carry more inventory and have more risk.
So research what a good margin is in your industry and take this as an average when choosing your brands. After all, you need a good margin to cover the costs and to be able to put products on sale. Keep in mind that there are two kinds of margins: Gross Margin and Net Margin. Gross Margin is the difference between the cost of goods sold and the selling price, or Cost of Goods Sold/Selling Price. Net Margin is the difference between total revenue and total expenses, or Total Revenue-Total Expenses.
8. Importance of brand experiences
The customer experience of your brands determines te success of your retail start-up. A strong reputation can lead to increased customer loyalty, more repeat purchases and higher levels of customer satisfaction. Therefore, look for brands that have been investing in creating a positive experience for their customers. Do they have designers, engineers, and marketers to create an experience that is memorable and valuable?
The importance of a positive customer experience can be seen by the number of reviews they get on social media. The more positive reviews they get the higher the quality of their brand experience. A high quality brand experience leads to more customers coming back for more products and services from the company.
A customer experience is what a user has with a brand. It can be through any medium – talking to customer service, using the product, browsing the website, reading about it on social media. This experience is what matters in the end.
9. Warranty and service
Warranties are one of the most important aspects of any product or service. It is the promise that you get from the manufacturer or supplier that your purchase will be fixed if anything goes wrong with it. The warranty gives you peace of mind, because it will be fixed at no cost to you.
Moreover, it is interesting to see how much help a brand offers. Give them a call and find out if the supplier can answer your questions and help you with your needs.
10. Delivery times
Delivery times are a crucial part of any business. It is important to keep the customers satisfied
and happy with the speed of delivery. Low inventory can cause a lot of problems for a start-up. If there is not enough stock, then customers will have to wait for their order. This will lead to customer dissatisfaction and low customer satisfaction rates.
It is important that businesses have an accurate understanding of their inventory levels and delivery times. They should also be able to predict how many orders they can expect in the future as well as what products they need to order more of. This way, they can avoid stock-outs and ensure that their customers are happy with their service.
Therefore, delivery time of a brand is an important factor for customer satisfaction. It is necessary to have a low inventory and a fast delivery time. This ensures that you minimize risk and that customers are still satisfied.
We look forward to share the best strategies with you.
Thank you!
Bring your shop to the next level
Hi, I'm George and I like retail and technology. Therefore, my passion here at Retailgear.com is to provide you with reliable information to automate and digitize your store. You can find out what we can do for your industry through our menu. Also, feel free to check out this updated list of retail tools.
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