Loadin’ Up the Leads Hopper
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When hunting for new business, you want to have a process in place for generating new leads.
There’s no need to get overly nuanced or rigid with your lead categories and definitions. Keep it simple, and don’t get caught up in semantics. We’re not using lead categories to map out the stages of a pipeline and predict the likelihood of closing a deal. We’re not using them to measure our performance or to project revenue. We’re just using them to keep things straight in our heads.
Here are the categories I like to use:
A Lead, in its most basic sense, is any business that has the potential to buy your product, but you haven’t yet determined their level of interest, nor their viability as a customer.
Leads can either be Inbound or Outbound.
An Inbound Lead comes to you through your marketing efforts. The buyer hears about you through some press you got, or through a Facebook ad you placed, or simply by seeing your product in another store. They find you and reach out to you.
An Outbound Lead is a lead that you go out and find the old fashioned way, by pounding the pavement (or in these days, the internet). You find them and reach out to them.
A lead can either become a Prospect or a Dead Lead.
A Prospect is a business that isn’t buying from you yet, but that has demonstrated an interest in your product, and that you believe exhibits the characteristics of a good account. In other words, leads become prospects when they’re interested in you and you’re interested in them.
A Dead (aka Disqualified) Lead is a dead end. For any number of reasons, you’re convinced that they’re no longer worth pursuing. They’re not a good brand fit, they’re not giving you the time of day, you get the sense that they would place one order and then go radio silent, they seem like they won’t pay their bills … you name it.
A Prospect can either go on to become a New Account or just another Dead Lead.
Loadin’ Up the Leads Hopper
The reason you need a steady supply of leads is so that you have something to feed into your sales process:
As far as machines go, our sales process is highly inefficient. For every Solid New Account it yields, it will also yield a ton of chaff: Mediocre New Accounts, One-and-Done Orders, and piles of Dead Leads.
That is why it is critical that you have an abundant supply of new leads to feed into it.
I’ve kept the Sales Process a black box for now. I’ll reveal its inner workings in the next couple of posts. But first, how do we keep the leads hopper full? How do we conjure up this steady supply of new leads?
Inbound Leads
The more buzz you build around your brand, the more leads will come to you. In an Enterprise sales organization, buzz-building and inbound lead generation would fall on the marketing team, but as a rep for a Small Wholesale Producer, you probably don’t have the luxury of a marketing team. We’ll cover marketing tactics for Small Wholesale Producers in a later post.
For now, let’s assume that you have some buzz going, and some leads coming in. These are what we call Inbound Leads. If someone is seeking you out, it’s generally a good indicator that they’re a decent brand fit, and that the buyer is motivated and looking to buy.
It is therefore very important to have an obvious way for them to inquire after your product. The first place they will check is your website, so it should be crystal clear from your landing page how to inquire. See my post Must-Have Website Features for a broader look at what your website should include, but here is the specific info you want to gather from an inquiring retailer:
Responses entered through the form should populate a spreadsheet, which you can easily load into your leads hopper.
If your conversion rate from inbound leads is lower than you’d like, it’s a pretty good indicator that something is off about your wholesale game. These are people who went to the trouble of reaching out to you, and when you responded they vanished. Why? Pick up the phone and call some of those inquirers and ask what it is about your response or your wholesale information that turned them off. Valuable intel about your product, pricing, and policies can be gathered this way.
Outbound Leads
Alas, they’re not all going to come to you, so you’re going to have to go out and find many yourself. It takes time to build buzz around a brand, and until the leads are pouring in, you have to do it the old fashioned way — by pounding the pavement.
This begins with research. The internet isn’t a bad place to start. In addition to your basic Google search for “x type of store in x city,” Yelp is a great place to search for specific types of shops within a specific area.
Check the websites of your competitors to see if they list their retailers. The idea here isn’t necessarily to poach your competitor’s retailers, or be in all the same shops as your competitors. But there is the potential to win over a few, especially if the retailer has been frustrated with your competitor for whatever reason and are looking for an alternative vendor.
More important, by researching where your competitors are selling, you get a feel for the different types of stores where your category of product has potential. For instance, maybe you sell jams, and in researching your competitor you find that their jams are selling in a couple boutique trinket stores and a whiskey distillery in their home town. Perhaps that will jog some ideas for unconventional targets in your own home town, where you can work the local product angle.
In addition to researching your direct competitors, research where companion products are selling. In the jam example from above, what goes with jam? Crackers, cheese, charcuterie, and nutbutters. Now, research all the companies that make said products of a similar caliber to your jams. Wherever they are selling has the potential to be a good fit for your jams.
Trade magazines often publish a list of retailers that carry their magazines. For instance, Culture Magazine, the premier magazine for independent cheesemakers, prints their list once annually, and that list is a goldmine of good targets for any producer of products that go well with cheese, including cheese knife makers and cheese board makers, winemakers, craft brewers, and so on.
As a sales rep, you’re hopefully out and about in the field often, visiting accounts. Keep your eyes and ears peeled for shops that might be a good fit. Be armed and ready with sell sheets, samples, and business cards for spur of the moment sales pitches. This is especially important when you’re traveling outside of your home region, since you won’t be circling back there anytime soon.
And speaking of travelling outside of your home region, keep an eye out for free shopping guides in whatever city you’re visiting. These are often published by the local chamber of commerce, and distributed to coffee shops and the like. Local free papers will often print ads from local retailers, which might jog some leads too.
Referrals
Don’t be afraid to ask your current retailers to recommend you to other shops that they’re not direct competitors of, and that they think your product would be a good fit for. Usually a retailer who is happy with your product’s performance and your customer service will be happy to help spread the word.
This tactic gives you a solid foot in the door with new leads, so it’s always worth your time to study the social connections of your existing customers. Are they friends on Facebook with another store you’d like to target? Ask for an email introduction.
Referrals are such gold that you may even consider having a referral program, in which you offer some incentive to customers who refer you another retailer that goes on to become a customer. 50% off of their next order, for example. Small price to pay for a solid new account.
Trade Shows
The words “trade” and “show”, when uttered in the same breath, can strike terror into the heart of anyone who’s ever attended one. The major trade shows boast tens of thousands of attendees, and thousands of exhibitors, all shouting themselves hoarse and deaf in an enormous convention center for days on end. It’s the endurance contest of a lifetime, and the event itself is merely the apex of the weeks of prep work leading up to it, and weeks of follow-ups afterwards.
And they’re expensive. As of this writing, the fee for the smallest booth at the Fancy Food Show is upwards of $4000. Expo West, the big natural foods trade show, costs more like $6000. Factor in travel to and from, accommodations, your booth build-out, and staffing, and you can easily clear $10k.
Unlike markets, you’re not selling your product to the attendees of trade shows, so you’re not going to recoup your costs that way. Trade shows are attended exclusively by wholesale buyers that are looking for new and exciting products to stock their shelves with, so you have to bring your A-game and land some solid new accounts to make it worth the trip. The pressure is on, but the convenience factor is quite high — you’ll meet a great many national and international buyers from all sorts of different channels, all in one place. Buyers walk around wearing badges on lanyards, and when they show an interest in your product, you simply chat them up and scan their badge, which collects their contact info for easy follow-up after the show.
In short, trade shows can be an excellent way to net some new accounts, both large and small, while expanding your targets list and boosting your brand awareness. But they’re not for every company. If you don’t think you can swing the overhead costs, or if your production isn’t in a place to supply a sudden influx of new retailers, then you should hold off.
Ask some of your existing retailers which trade shows they attend. Consider attending a few if you can figure out a way to sneak in, just to get a feel for which ones are most attended by your target customers. This will also give you a feel for what you can do to best prepare if you do decide to exhibit down the road.
Be Selective
I’ve said it several times before, but it bears repeating: it’s very important that you understand who your target customer is and where they shop, so that you don’t waste your time and sanity pitching to stores where your product won’t sell.
You will bust your ass for no gain if you try to shoehorn your product into markets that it isn’t designed for, because even if you manage to sell into these stores, your product won’t move and the buyers won’t reorder. In our Sales Machine illustration above, those are the “Mediocre New Accounts and One-and-Done Orders.”
Remember too that there is a lot of followup involved with any pitch, so if you are flooding your hopper with any and every lead, your followup workload will quickly become unmanageable.
By pitching only to stores where your target customer shops, your pitch will be strong and authentic, and you will be pitching to buyers who understand your product and appreciate its value, and who are excited to have it on their shelves. These are the kinds of wholesale partners who will do everything in their power to sell your product for you.
To understand who your target customer is, you must search your soul and ask yourself who you’re making your product for. When you discover your soul customer, ask yourself where this person shops, and then search for retailers who cater to them.
You can prescreen stores that seem like potential matches by perusing their websites and social media. Skim their blogs, search for any press they have received. And by all means, visit them if you can. Keep notes on any evidence you find that they could be a good fit, as this will become an important part of your pitch. Maybe they have a similar aesthetic to you, or similar values. Maybe they feature products that you’ve found to be good companion products to yours. Maybe the price range of the products they feature is well-aligned with yours.
When generating your targets list, keep your mind open to channels that are less immediately obvious for your product. Perhaps you make a bar soap that features kelp and sea salt. The obvious channel for your soap would be bath and body shops, but what about aquariums and seaside gift shops as well?
A Note about Declining Inbound Leads
Leads that come to you will not always be a good fit. You can and should be selective. It is tempting to say yes to everything, but not all partnerships are meant to be, and through trial and error you will get a feel for which inquiries have the potential to grow into solid partnerships, and which are dead ends that are not worth your time and energy.
Of course you don’t want to tell them that you think they’re a poor brand fit, or that their business model is bogus. Instead, tell them “no for now.” Tell them how much you appreciate their interest in your product, but that it doesn’t feel like the right fit at this time, and that as a small business with limited production you are only equipped to take on the best fits. You will keep them in mind should anything change. No need to beat around the bush here. Retailers dole out their share of rejections, as you know. They can certainly handle a little rejection of their own.
If you’re in the fortunate position of having a higher demand for your product than you can supply without overextending yourself and your production capacity, then you have a convenient excuse. Politely decline all but the best fits for now, and tell them you’d like to circle back when you’ve achieved a better balance between your demand and your production capacity. Better to grow your business slowly and steadily than quickly and chaotically, at the expense of quality, customer service, and order lead times. Telling someone “no for now” will only make them want your product more when you’re finally ready to launch with them.
