In our Penn State Extension Food for Profit workshops, we routinely discuss the necessity of targeting a niche market, then innovating related to that market segments' wants and needs - actually getting ahead of your customer by creating what they will want next (before it is realized by target customers). This process takes time and research, first identifying a set of similarities that define the group, learning as much as possible about the group (observation, social media, etc.) to create a strategy to reach these customers in ways that count. This process works well for entrepreneurs who will make the product, and make direct sales.
However, if an entrepreneur sets his or her sights on selling to retailers (the ones who actually target, and sell to consumers) the market research can get a little "murky." A new perspective is needed to develop an effective wholesale campaign that hits home for buyers - one that replicates the targeting to actual food customers.
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| Being a link in the supply chain takes connections, work and perseverance! |
The SBA Blog Spot has a great article by Caron Beesley (a small business owner, a writer, and marketing communications consultant) that provides basic insights in how to become a supplier to larger retailers. While it may be a long, uphill stretch to attract the attention of buyers and get products from your small-scale food manufacturing concern placed in a substantial retail chain, Beesley indicates that the potential rewards are substantial. She references a study that showed that after a small supplier lands a contract from a bigger company, the small company's revenues go up 250 percent and they create about 150 percent more jobs in just two or three years.
So, how to enter this lucrative marketplace? Like all marketing activities, the process starts with research. Start with identifying potential buyers, and then define the value your small business can offer if they carry your product(s). One source of information about potential wholesale buyers is the Supplier Connection. This portal allows small suppliers (with less than $50 million in revenues, or less than 500 employees) to market themselves (free of charge!) to a number of large U.S. companies at the same time, so that the "large guys" can expand the variety of items sold, while giving capable small firms the opportunities of the large marketplace.
The Supplier Connection is relatively easy to use, with a downloadable manual to facilitate new businesses' participation. Each participating member creates a profile to display company information, their small business commitment, usage of Supplier Connection within their company, contacts, etc. Accessing the Supplier Connection enables small-scale food business owners to identify businesses that are the best fit for their product lines.
Most times, just being registered is not enough. There are several social media channels that will make a business more apt to be noticed through Supplier Connection. One of these is a Linkedin group for small business members. In addition, Supplier Connection can be visited on Facebook, Twitter, or Google+ for news, updates and information on small business development and they have a blog that hosts a monthly contest and highlights small business success stories. Each of these are a great way to be actively learning and launching a wholesale endeavor.
No route to launching a food business is 100% guaranteed - and there may be many barriers to break through on the way to successful wholesale marketing of a food product. However, taking the time to get to know the "lay of the land" to successfully connect with potential customers will increase the chance of success in becoming a part of a supply chain - and getting a food product on its way to the consumer.
