As a sales channel, e-commerce is all the rage these days, allowing you to meet lofty goals such as expanding your business to exotic new markets and competing on the same platform as global heavy hitters. However, as a small and medium-sized business (SMB), there’s one great option that you shouldn’t dismiss – selling through your local retailers.
If you’ve developed a new product that you want to get into the market, here are five reasons why your local community is the best place to start.
- Opportunity for growth
Before scaling your operations for a successful expansion – such as selling on consignment to a large retail chain – you need to have a clear, indisputable record of success. If you can prove that your product has been a profitable investment for other retailers, big-box stores are far more likely to pick yours up. Distributing your products through small, independent stores will go a long way towards helping you to build credibility for your brand, as well as demonstrate demand for what you’re selling.
- Good product testing site
The patrons of your local retailers cover a wide range of demographics, which makes it the perfect place to find out who your product really appeals to. It also allows you to get quick and honest feedback from the storeowner about the performance of your product, making it far more effective than conducting focus groups or surveys.
- People love supporting local companies
A report from Nielsen earlier this year found that in Southeast Asia, regional and local brands are starting to outperform multinational companies. Among the key factors responsible for this shift in the competitive landscape is the fact that consumers feel a nationalistic pride and sense of loyalty towards home-grown startups. Additionally, they also feel that local players understand their nuanced tastes better, especially when it comes to food and beverages. Although this data is based on the fast-moving consumer goods (FMCG) sector, who’s to say that it can’t be applied to other industries?
Retailers also love working with smaller suppliers who are often more agile and flexible, easier to reach out to and more earnest in growing sales.
- More control over pricing
Selling online or in a different geographic region makes it less straightforward for you to play around with your pricing strategy because you have logistical costs to factor in. Large retailers are also aware of the difference in costs between importing products from another country and sourcing locally, which gives your brand a leg-up on international competitors when it comes to negotiation.
- Increased brand awareness
Having a retail store distribute your products is essentially doubling your brand awareness, as it’s a new outlet that’s vouching for you and stocking your product alongside other reputable brands. It also means that the retailer has an interest in selling your products, so if you have any promotional ideas, you’ll be able to collaborate with them to help market your product.
As SMB owners, cultivating a strong presence in your local community can be the best way to give your fledgling business the boost it needs to succeed on a larger scale.