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
small
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
guys I appreciate the support and thank
you again for new subscribers if you are
just subscribing if any my videos can
help someone that you know please do let
them know about my channel I appreciate
you guys spreading the word about my
channel you have any questions again ask
me down below and I'll get to them as
soon as I can thanks