For thousands of years, craftsmen have created a product by themselves or with the help of a few employees and sold the products out of their homes. But does this strategy still work in a globalized economy? It can, although most inventors start selling locally to launch their product in a bigger way.
Most often, when I hear of an inventor who only sells locally, he or she just kind of fell into it. For instance, let’s say that an inventor came up with a great new yard tool specific to his or her geographical location. The inventor only intended to use the tool him or herself, but when neighbors and relatives saw it, they wanted one too. So the inventor makes more products to sell to his or her neighbors and relatives, then their neighbors and relatives see the new tool and also want one. Soon the inventor has a small business going and if there are enough sales the inventor may be happy with the level of sales and not really look to grow. But selling locally can also be your launch pad into regional, national and possibly international sales. Selling locally can hone your sales pitch, product and prove to potential partners, retailers and distributors that your product has what it takes to make it big.
When using local sales to launch your product in a bigger way, you need to document and prove your product’s ability to succeed. You need to attack your local sales in a big way, with PR, demonstrations, and a number of other things to ensure your product sells well. If your sales are slow or stagnate, potential partners, investors, or sales reps might take that as a sign that your product is not a winner. So you need to put maximum effort into these early sales to show your product’s potential.
Why local sales? Local sales are easier, not just because you are closer in proximity. Local products can create good word-of-mouth and PR, making sales easier. Then you document these early, easier sales to convince sales reps, distributors, and retailers in other geographical areas to carry your product.
Getting Your Product into Local Stores
Getting your product into local stores is not always easy, but there are lots of ways you can make it as low-risk as possible for store owners. There are three main ways to make carrying your product low-risk: discounts, consignment and guaranteed sales.
Discounts
Discounts means that you offer a discounted wholesale price, meaning that they will make more money per sale. This still presents a risk for the retailer, but makes your product more attractive.
Selling on consignment
Selling on consignment means that the retailer doesn’t pay you the wholesale price of your product until the product actually sells.
Guaranteed sales
Guaranteed sales simply means that you refund the retailer for any products that don’t sell after a certain amount of time.
These methods help retailers take a chance on your product. Also if you offer to do the steps listed below to help sales, you will increase your chances of them taking on your product.
Key Steps to Selling Locally
Let’s take a look at what it takes to successfully sell locally.
Media Coverage
Local newspapers don’t always have lots of exciting things to write about, so when a local inventor starts selling his or her product, local media will probably be interested in a story. The key here is that an inventor just selling a product is not a story. But if you talk about how you came up with your idea, your process of product development, your current sales efforts and your future plans, that makes a much more exciting story.
Media coverage helps you by getting the word out about your product. Seeing your product featured in a news story also creates more trust in your product than an advertisement. This trust, and the fact that you have a local product, will make people more likely to buy your product.
Word-of-Mouth Advertising
Selling locally also usually creates word-of-mouth advertising. Word-of-mouth just means people telling their friends, families and co-workers about your product. Local products create local interest and can get people talking.
You can help word-of-mouth advertising by getting the right people talking. In every community, there are influential and listened-to people. If you market to these people, or even give out samples, you can get these influential people talking, and other people will listen.
Also in every community there are people who love to spread news. These people know everyone and always have something to say. Getting these people talking about your product will also quickly spread the news.
In-Store Demonstrations
One of the big benefits of selling locally is that it makes it easy for you to be involved in selling your product, even in a retail setting. One of the most effective ways to be involved is by giving out samples or in-store demonstrations.
Most retail decisions are made in a matter of seconds, so it is easy for potential customers to pass over new products. That is why in-store demonstrations or samples are important for new products. Demonstrations grab potential customers’ attention and allow them to touch and try a new product which helps them overcome any hesitation in buying a new and unknown product.
Special Displays
You aren’t able to do in-store demonstrations all the time and during low-traffic times it is probably not worthwhile for you to be in a retail setting waiting for customers. But when you are not able, or when it is not worthwhile, to do demonstrations, you still want to get customers’ attention. For these times, you want special displays. There are a variety of attention grabbing displays out there and if you go to a mall and visit stores, you can get an idea of what might work with your product. Some of the more common ones are end-of-the-isle displays and floor displays.
Sales
Sales are another way to attract attention to your product and help overcome hesitation in buying a new product. If you offer sales or coupons, you will need to pay back the retailer for all the coupons redeemed or sales made.
One tactic that you can also use is a co-op advertising program. When you receive a sales booklet or flyer from a store, manufactures whose products are listed pay for 50 to 100% of the ad in free goods, hoping to generate enough sales to cover their costs. So you might give the retailer 24 products at no cost products to sell if the retailer includes your product in its next circular or newspaper ad. This tactic is especially effective if your plan is to use local sales as a launching pad for bigger market sales.
Using Your Local Success to Take on Regional and National Sales Reps, Distributors and Retail Stores
From the very beginning of your sales, keep careful records, documenting the success of your product. Then use that information as you talk to sales reps, distributors and retail stores. Also take pictures of your product selling or people trying your product at demonstrations to use in your talks. You can approach sales reps, distributors and retailers by simply saying that you have successfully sold your product in your local area, share your sales figures, and say you are looking to expand your sales. If your sales figures are impressive, they will listen.