Food products into Retail Stores How to sell a food product to retailers

hey guys it's Damien from marketing food

online I've got a interesting video I'm

actually responding to another question

that one of my subscribers had sent to

me it was actually in regards to what's

known as slotting fees and these

slotting fees are actually to bring it

down so you can understand what they

what they are is they are fees that are

paid by companies to have the beginning

of an Isles either four foot six four to

eight foot section okay and a lot of

times slotting fees are paid in advance

of bringing a product into a store so

that it's they could get that prime real

estate as they call it so if you were

actually go down an aisle for instance

the first four feet six feet to eight

feet of an aisle

you'll notice that there's certain

brands that are always stocked on that

on that beginning of the aisle and

depending upon the grocery store this is

actually much of this is a factor based

upon how the grocery store actually

operates or how the retailer operates

and for instance if you went to the

stock aisle and you noticed a lot of

Lay's potato chips and they're like

right on the beginning of the aisle and

they go down for several feet ladies

brand' potato chips will actually pay in

advance of bringing their products in so

they can set up and have their products

displayed on the entrance of an aisle

the majority of purchases made in retail

stores are always made from the

beginnings when do the entrances of

front and the back of the aisles and

that is because most of most of the

shoppers will recognize those products

first so it becomes something that's a

quick grab or easy grab and of course if

they are loyal to a certain brand they

will immediately grab that product when

it's at the entrance of the aisle

okay so slotting fees are actually fees

that are based upon paying a retailer to

have the best location in the store on

the aisles where their products are

displayed now if you were a small-time

food producer I'm going to give you an

example and experience that I of

experience because I can only speak

about what I've experienced when I was

in retail stores with our candy we

actually were given a section of a candy

display it was actually an island

display and most of our candy so we

actually had to restock them we had to

go every weekend restock them set up a

demo table we had to demo all the

candies out and we would actually

replenish based upon what the store sold

we would keep a

inventory give them an invoice and hand

it to the to the actual store manager

and the store manager would sign off for

those specific quantities that we were

bringing on board into the stores and

then from there we would get paid this

was before you actually get accepted

nation nationwide or rolled out

throughout if the if the actual store

has locations throughout the US you

would actually do some stores within a

region first and it normally is about

they give you a test run of about four

to five stores maybe six or seven maybe

out a half a dozen and then from there

they see the response and they see the

sales driving being driven by those

local stores and then they would say hey

look we would like to roll you out

regionally and then that would be like

four or five states and then from there

it goes out to even more states so when

you start off with a new product and

you're going into a retailer just

understand that normally they don't

charge you a slotting fee they won't

even offer you the the slotting fee up

front they want to just test your

product out initially and of course

remember every retailer is different if

you have a product that they want to put

on the aisles they're going to give you

normally two to three rows this is of

course based on my own experience

working in the retail stores I noticed

many products normally would only take

up about two to three rows worth of

product and it would either be stacked

on each other or would be on the Shelf

itself and they would give you a couple

of different levels in the shelving but

normally about two to three row two or

three rows of the product okay and they

traditionally don't charge normally

small food producers because again

they're only going to give you they're

gonna give you a free space on the shelf

and how that normally works is that you

would come in and you would demo the

product you would get a little bit of

space and then from there they would say

hey you know what we love your products

so much we're gonna give you two dozen

or three dozen stores and we would love

for you to be rolled out regionally and

then that gets into a whole totally

different ballgame so keep in mind so

when you're starting off if you can get

yourself into some mom-and-pop stores

that's always a great foot in the retail

realm if you want to go and approach a

national chain like a Walmart a Kroger

of Publix wagons whatever the store may

be that's in your area but it's a

nationally recognized chain they

normally will start you off kind of very


because also the other other factor is

the production your production

capabilities if you are producing

several hundred and you can max out at

several hundred units a week or even

seven hundred units a month no national

chain will sign you up for twelve

hundred stores if you can't fill 1,200

stores so just keep that in mind they

normally again they're not going to

charge you a sliding fee when they get

you into the stores you can check with

the buyer and then they will tell you

more specifically I can't honestly speak

on the different store chains because

they do actually all operate differently

but of course when you're going up

against some of the big chains like if

you have a snack product and it's

frito-lay Lay's chips of course if it's

a handful of other snack vendors even

Pepsi Cola Pepsi Cola Company owns

enormous amounts of brands that are

actually snack products when you're

going up against those big big brands

you probably won't be on the beginning

of the aisles you probably won't want to

have the capacity or the ability to

start buying real estate on the grocery

shelves so just keep that in mind I hope

that explains briefly what a slotting

fee is and how that slotting fee works

and then who it really applies to so if

you're just beginning it really I'll be

honest with you probably doesn't apply

to you and you won't necessarily have to

pay a slotting fee so if my video was

helpful please do give me a thumbs up

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soon as I can thanks