July 2009 – Channel Crossing: Retail

Having a Plan Will Save You Money

By Hal Altman

This year, the retail industry has experienced the closing, bankruptcy or near bankruptcy of some of the largest and most successful retail names of the last 25 years. Others such as Walmart, Costco, Sam’s, Target and Bed Bath and Beyond seem to not only survive, but are also able to show profits in our unstable economy.

What does this mean to the direct response industry? Less outlets to sell product that television, radio or web has worked hard to advertise, establish and create a brand for.

Retail chains have not only breathed life into direct response products, but in most cases, successfully outsold traditional direct response sales exponentially. In tough economic times, retailers search for recognized direct response product and know that with continued television and radio coverage, combined with retail exposure, this can be a win-win situation for all.

RETAIL: A NATURAL FIT
The next question is how do direct marketers prepare and get into the lucrative world of retail? The answer is easy, and doesn’t cost any more to prepare for retail distribution while you introduce your product via traditional direct response channels.

Look into a retail distribution company that can guide you through the process of packaging your merchandise so that it can be easily and inexpensively ready for a rush retail test. You don’t want to ever be caught in a position of not being able to immediately furnish your product for a retail test if the opportunity arises. Prior to manufacturing your merchandise, ask yourself the following questions:

• Can I ship this product to both direct response and retail with a simple cosmetic change of outer cartons or with the addition of a color sleeve?
• Should I apply for a UPC code in anticipation of retail sales?
• Will my merchandise be compliant with retail carton sizes?
• On the carton, did I print the ITF-14 (this number is used to uniquely identify units in the supply chain)? Did I print the weight in pounds? Did I print the country of origin? Did I print units per carton?
• Are my outer cartons marked with vendor SKU, product description (color/style/size) and number of saleable units per master?

The checklist above will not impact your fulfillment house’s handling of your direct response orders. In fact, it will cut down on some of the handling time associated with making the transition from DR to retail. It can save you the major expense in materials and labor if you plan on using the same direct response merchandise for your retail customers. It allows you to work out of one inventory for either type of order, utilizing your inventory in the most efficient way possible.

Major chains are demanding in their specific EDI and merchandise requirements. The guidelines listed will not ensure that additional labeling and/or labor will not be necessary for each individual retailer, but it is the very beginning to saving you money and time when entering the retail market.

Hal Altman is president of Motivational Fulfillment and Logistics Services in Chino, Calif. He can be reached at (909) 517-2200.