5 Easy ways to improve your follow up after a trade show

Would you be shocked to learn that over 75% of trade show exhibiters will never fully follow up with all the leads they gather at the show.  

Why is this?  Is it because they think buyers lied to them and are not as interested as they let on?  Is it because they took poor notes or misplaced information?  Maybe they are simply lazy or overwhelmed.  

I have wondered and pondered this statistic for years.  There is really one reason and one reason only for attending a trade show, leads.  Yes, of course, branding is part of the over all goal, but leads that turn into sales is the #1 purpose of any trade show, right?  If this is true then why the disconnect?  Why do so many exibitors fall down here?  I believe planning and allocation of time is the real issue.  Having either attended or consulted on 100s of trade shows myself over the years I have seen lack of planning and time allocation result in poor trade show performance time and again.  If you are attending a trade show where you could potentially gather more than 100 leads you need to plan for and clear a certain amount of time following the show to do nothing but follow up.  

Below are 5 suggestions for a stellar follow up routine after any trade show.

1.     Clear your schedule – Prior to the trade show beginning you must clear 2-4 days after the show ends to complete your follow up.  Many sales people either take time off or go back to their daily routines directly after a trade show.  If the trade show is 3 days you should allocate 1-2 days before for preparation and 2-3 days after for follow up.
2.     Don’t follow up during the show – I have known sales people that feel if they follow up each night of the show they will stay on top of their leads.  Although this may be true, their follow is falling of deaf ears as their prospects are still at the show and overloaded with information.  You should always begin your follow up 2-4 days after the show ends depending on how big the show was.
3.      Don’t stop working – Instead of spending time each night following up during the show, use this time to complete the normal work piling up in your inbox.  Doing this will allow you the time you need after the show to focus on follow up.
4.     FOLLOW THROUGH – I cannot yell this loud enough.  If you promise something at the show you must follow through on what you said you would do, when you said you would do it.  I know this sounds like a no brainer, but I have spoken to many buyers who say sales people at a show said they would call or send samples and never did.  Don’t be one of those sales people; follow through!
5.     Everybody counts – Don’t follow up with some and not with others.  There will always be large, small and medium sized opportunities, they all deserve to hear from you after the show.

Quick Tip: When taking business cards always write something identifying on the back of the card that will help you remember the person and what you promised to do for them.

Pricing your Product for Retail: What not to do!

Case Study “Great sales, no money”:

Last year a food company came to me and asked if I could help them with their pricing.  As with all my potential clients I asked them a couple of clarifying questions to get a handle on if I could help or not.  As it turned out this company was already in a large club store and was doing quite well.  There was only one issue, they were not making any money.  Like so many before them they had been blinded by the allure of a Club store only requiring a 14% or less margin on their item.  They had wild visions of how they would spend the extra margin coming their way.  Boats, cars, the sky was the limit, or so they thought.  It wasn’t to long before they received their first check and noted a % had been taken out for returns, which was an area they had not counted on.  Next there was the business of markdowns in the underperforming warehouses, this was money they had not counted on either.  Finally, in an effort to stimulate sales, they were asked to promote their product by placing in on an end cap and were paralyzed by the price tag.  These items are not the retailer sticking it to the little guy, it is simply the cost to do business in mass retail and must be factored in before any pricing is offered.  

Ultimately we were able to find some efficiencies in their logistics and packaging which freed up some short term margin.  We also worked with their manufacturing to create a broader, longer term solution which made sense.  

It's tough enough to gain retail distribution in today's market, the last thing any manufacture wants is to find out they quoted incorrectly. 

Lesson:  Never simply assume your pricing will work.  Know your back end costs and ensure you feel good about your bottom line prior to quoting any pricing to any retailer.

9 Strategies to a successful Trade Show

As I help my clients prepare for this years International Housewares show, coming up in March, I noticed that I have been a bit more insistent regarding preparation than in years past.    It is not that I don’t always yell preparation from the rooftops; it’s just that this year seems a bit different. 

I know what your thinking, if I tell them to wear comfortable shoes and take good notes all will be well.  But the truth is, YOU NEED MORE THAN COMFORTABLE SHOES AND A NOTEPAD TO HAVE A SUCCESSFUL TRADE SHOW.

Over the years I have followed a specific trade show regiment, a regiment that has lead to many successful and lucrative trade shows.  It is this set of simple, perfected guidelines that I have shared with my clients this year, and the very same I am going to share with you now. 

Please understand I am not reinventing the wheel here.  I don’t have the recipe to Coke or a map to buried treasure.  What I do have, what I have used in the past to create trade show success are the following guidelines.

1. Set a goal
2. Do your homework
3. Build your list
4. Set appointments
5. Have an offer, no really, a good offer
6. Capture leads
7. Know your differentiator
8. Learn to Re-adjust
9. Follow up

Setting a Goal:

I am sure, as a professional or entrepreneur, your first thought was “dah”, of course you should set a goal.  However, you may be shocked to find that less than 10% of exhibitors at any given trade show have actually set a tangible goal and keep that goal in front of them daily at the show.   Here are a couple of guidelines to remember when creating and setting your trade show goals.

• Be specific – I want to generate 150 quality leads.  From those leads I want to close $$$ of sales over the next 6 months.
• Write them down – Ensure your goals are written down and with you at all times.
• View your goals – Reviewing your goals each day prior to the show opening will help you stay focused as the long day wears on.

Do your homework:

There is a tremendous amount of opportunity and unseen expense that goes along with every trade show.  In order to be fully prepare in advance for your show you must read, not skim, read through all of your show paperwork.  Not informing yourself can leave you on the sideline for great, free opportunities that can showcase your product and can leave you holding the bag on costs you were not prepared for.  Don’t be afraid to ask for what you want even if the deadline has passed, you will be surprised at how accommodating the promoters can be if you are professional.  Just last week one of my clients submitted their product to be part of the Green products display at the Housewares Show.  Even though the deadline had pasted they were accepted.  Never hurts to ask.  Below are a couple must do’s for every trade show attendee.

• Fill out your online profile completely.  
• Don’t leave any area unfinished unless it simply does not apply. Upload quality images of your product and logo.  No iPhone pics here.
• Apply to every award or special venue that your product qualifies for.
• Keep hard copies of everything you have done and paid for in a file that will go with you to the show.

Build your list – Many first time show attendees believe that if they build a great booth or have a great product, buyers will magically come.  The problem with this strategy is that most major retail buyers have already prescheduled their time and are running a very tight schedule.  These buyers are running from one appointment to another and are not simply browsing down each aisle to see if something catches their eye.  Having a great booth with no list is like having a great website and not doing any SEO.  Building your list begins well before the first day of the show.  I am sure you are asking, “What the heck is My List?”  Your list is the people you have reached out to prior to the show and let them know who you are, where your booth is and why you would like them to come by.  Remember, this is a numbers game, the more people you reach out to and introduce to your company; the more buyers will make time in their schedule to come visit you.

Set Appointments – Once you have reached out to as many current and future customers as possible, you should begin to set appointments.  I recommend creating an appointment sheet for each day of the show.  The appointment sheet should be broken down into 15-minute increments beginning 1 hour after the show opens and ending 1 hour before the show closes.  This will give you time in the morning to prepare and time in the evening to recap.  It is conceivable that certain appointments will take longer than 15 minutes and if this is the case simply mark off 2 or more sections for that particular customer.   Not every buyer will set an appointment with you, however you should do your best to set appointments with the buyers you are most interested in doing business with.  This will ensure you are available when those buyers come to your booth.

Have a really good show special – It is extremely rare for buyers of any large retailer to commit, on the spot, to an order.  With that said, it is possible to write orders for specialty, online and single store owners on the spot if you have a great show special.  Below are some specials that can turn the heads of smaller retailers.

• Extended terms – Privately owned specialty retailers will jump at the chance to purchase goods net 60 or net 90.
• Free launch kits – Offer free POP kits to retailers writing orders at the show.
•  Free Shipping – Offer free shipping on any order written at the show or free shipping on orders over a certain amount written at the show.
• For more ideas contact me at www.tlbconsulting.com

Capture Leads – If you are wondering if it is worth it to spend the money on a lead capturing machine wonder no more.  It is worth it!  Once the show is over these leads can be converted into a CSV file and downloaded directly into Salesforce or whatever CRM you are using.  Quick Tip: When taking business cards always write something identifying on the back of the card that will help you remember the person and what you promised to do for them.

Know your differentiator – Identify the one or two things about your product or service that sets you apart and work it into an opening one-line pitch.  You will only have a few seconds to grab the attention of potential customers, make the most of it with a great one-line opening.   I have a client who sells a compact, electric, composter that can turn kitchen scraps into grade A compost in less than 3 hours, with no smell or mess.  My opening line for this client was “Did you know that composting can now take less than 3 hours?”  Anyone that knows anything about composting knows that it takes weeks for food to decompose into compost, which made the above statement an attention getter. 

For help preparing for your next trade show contact me at www.tlbconsulting.com 

Learn to Re-Adjust – Now that you have your goals, your plan, your appointments, your offer and your pitch line what happens if nothing works?  Last year I was at a trade show for dieticians selling them a program for offering a certain type of cookware to their clients that would help their clients eat healthier.  The program made sense, the offer was great, the product was superb but every single dietician said no the first day.  What was their reason?  “How can I offer cookware to my clients that I myself have not even tried?”  This hit us like a ton of bricks!  Of course they wouldn’t offer a product to their clients they had not tried themselves, their credibility would be on the line.  After a powwow the evening after the first day we decided to create a 1 pan try me offer.  Instead of offering the program, the next day we explained the program, but offered a try me pan at a great price so they could fall in love with the product first.  This was a huge success and we generated over 140 leads in the final 2 days of the show.  Lesson: Don’t keep doing something that is not working.  Listen to your prospects and make adjustments if needed.

Follow up - Would you be shocked to learn that over 60% of trade show exhibiters will never fully follow up with all the leads they gathered at the show.  Why is this?  I have wondered and pondered this statistic for years and what I have come up with is simply a time issue.  If you are attending a trade show where you could potentially gather more than 100 leads you need to clear a certain amount of time following the show to do nothing but follow up.  Below are some suggestions for a stellar follow up routine after any trade show.

• Clear your schedule – Prior to the trade show beginning you must clear 2-4 days after the show ends to complete your follow up.
• Don’t follow up during the show – Some sales people feel that if they follow up each night of the show they will stay on top of their leads.  Although this may be true, your follow up will be falling of deaf ears as your prospects are still at the show and overloaded with information.  Begin your follow up 2-4 days after the show ends depending on how big the show was.
• Don’t stop working – Instead of spending time each night following up during the show, use this time to complete the normal work piling up in your inbox.  Doing this will allow you the time you need after the show to focus on follow up.
• FOLLOW THROUGH – I cannot yell this loud enough.  If you promise something at the show you must follow through on what you said you would do when you said you would do it.  I know this sounds like a no brainer, but I have spoken to many buyers who say sales people at a show said they would call or send samples and never did.  Don’t be one of those sales people; follow through!
• Everybody counts – Don’t follow up with some and not with others.  There will always be large, small and medium sized opportunities, they all deserve to hear from you after the show.

As you can see there are many aspects to a successful and lucrative trade show.  To maximize your opportunities none of the above 9 areas can be left out.  I hope the above information has been helpful and to close this article out I will leave you with one final thought.

If someone took the time to visit your booth, speak to you, take your information and leave theirs they have, at the very least, some interest in what you have to offer.  Don’t ever discard a lead, you may have to inactivate them for a while, but never stop following up.  No doesn’t necessarily mean Never!

I would love to hear some of your strategies for a successful trade show, please leave me a comment below.

How to Price Your Products for Retail

I am often asked as a consultant, “what is the first thing you will do after I hire you, what’s your plan of attack?”.  The answer is simple, pricing.  This might seem strange to most people as I am sure you can think of a plethora of other things you would rather have me working on than pricing, however the simple fact is, if your pricing does not work we are finished before even beginning.  

Product pricing should be an essential first part of your overall go to market product strategy, however again and again I see companies leaving this to the end and in some cases simply guessing.  There seems to be a mystique around pricing a product that often scares companies into a panic and this is where mistakes get made that can cost thousands of dollars down the road.  The mystery of margin, program, net, gross, delivered, FOB etc can leave you feeling overwhelmed and therefor uninterested. 

Well; not to worry.  You can put away your taro cards and cancel your appointment at the physic. We are going to take the mystery out of pricing by showing you:

• How to determine MSRP (Manufactures Suggested Retail Price)
• How to determine your raw cost
• How to determine your raw landed cost
• What is MAP pricing and should you use is?
• What is gross margin and how to determine it?
• What is “Program” and how does it affect your price structure?
• What is net margin?
• What is adjusted net margin and what should this number be to keep your business moving forward?
• How to price your product to best avoid knock offs.
• The difference between pricing your product online and pricing it for a retailer.

Alright, let’s get right to it!

MSRP - Determining your manufactures suggested retail price is critical to the rest of your pricing strategy.  Every retailer, buyer, distributor and etailer will want to know this number as they want to remain competitive with the market.  Before simply applying a 6 or 7 multiple to your cost in order to gain your retail I suggest you do some due diligence on your competition.  What are the other items in this category selling for?  Is your product better, worse or the same as what is on the market.  Does your product have features that separate it from the competition and can bring a premium retail price or is it a value offering from the competition and needs to be priced lower.  To bring a bit of clarity to this subject let’s create a scenario.  Let’s say your company has created a new smart phone case and you need to establish a base MSRP.  Your Raw Landed Cost(you will learn this below) on this item is $7.  If you times your cost by a 7 multiple to gain your retail you end up with a $49.99 MSRP.  On the surface this MRSP seems to work, however after some research you find the competition has this type of product retailing at $39.99.  This is where you will have to decide if your product (an unknown) can bring a $10 premium to known brands already on the market.  If not you will have to bring your retail down to $39.99 and rerun it through our proprietary pricing worksheet to see how this new retail affects your over all profit number.   At the end of the day please remember this one truth, MSRP is created by the customer.  To be more specific your product is really only worth what customers are willing to pay for it and not a penny more which is why pricing is such an important part of the process.

Raw Cost - This is the number your company pays for a fully packaged, production quality product at the manufacture.  Please note that a production product is not a hand made sample or one of a few sample products run from your factory.  A production product is a product pulled directly off the production line ready to go to a retailer.  It is this cost you are after.

Raw landed cost - This is the number your company pays for a fully packaged, production quality product including the cost of bringing the product to the US if it is manufactured overseas or to your warehouse if it is manufactured somewhere different then where you will be warehousing it.  How much should you factor into your product cost to land your product here in the US from overseas?  As a rough estimate only, you can take $4700 / the units of product that fit into a 40ft container.  This will give you a rough idea of how much you should add to your unit cost to have a complete landed raw cost.  Please keep in mind this is for rough estimates only, you should replace $4700 with your actual cost when you are receiving logistics quotes.  Ex.  If your the raw cost of your product at the port in China is $1.47 and you can fit 10,000 units in a 40ft container your cost per unit to flow the product to the US would be $.47.  This would make your Raw Landed Cost on this item $1.94.  If your product is manufactured in Wisconsin and your are bringing them to your warehouse in Texas you would simply substitute the $4700 for the cost of shipping the product from WI to TX.

MAP Pricing - MAP or Minimum Advertised Price is a policy used by some manufactures to create stability in advertised pricing of their product.  It means that no retailer or etailer can list or advertise a MAP’d product under the MAP price set by the manufacture.  Brick and Mortar stores can sell these items or even list these items in store for any price they choose as long as they do not advertise them for less than MAP.  This sound like a pretty good deal and you are probably saying to yourself, “Why wouldn’t I create a MAP policy?”  Here are a couple things to consider when making this decision; 1.  Once you establish a MAP policy and distribute it to your retailers you must treat each retailer the same irrespective of their volume.  This means if you stop supplying a small retailer because they violated your MAP 3 times and this is clearly stated in your policy then you would also have to stop supplying a large big box chain if they did the same or risk a huge law suit, 2.  Some retailers simply don’t want to do business with products that are MAP priced as it creates issues with their marketing plans.

What is gross margin and how to determine it - Gross margin is the difference between your selling price and your raw, landed product cost.  It is generally expressed as both a percentage and a dollar amount.  To determine the dollar amount the formula is SP-Cost.  To gain your gross margin % you would use the following formula formula: (SP-Cost)/SP. SP = sell price.  If your selling price is $79.99 and your raw landed cost is $27.5 the equation for gross margin dollars would look like ($79.99-$27.5).  Your gross margin dollars would be $52.49.  To gain your gross margin percent the equation would look like this ($79.99-$27.50)/$79.99.  Your gross margin for this item is 65.62%. 

What are program costs - Program costs can be considered any additional cost the retailer is going to ask you to be responsible for paying.  These costs should be built into your cost structure prior to quoting.  Not taking the time to understand these costs of build them into your cost structure prior to quoting pricing to a retailer is a recipe for disaster.  Your company must be able to incur these costs and still produce a healthy margin.  Some common program costs are:

• Returns allowance - A retailer might ask for a % off invoice to cover any returns.  This % can range from 2%-10% depending on the product. 
• Freight - At times retailers will ask for a “Delivered Cost”.  Delivered cost means that you will have to pay to deliver the product to the retailer therefor you must factor this cost into your pricing structure.  
• MDF - MDF stands for Marketing Development Fund.  This would be money that your company would accrue for future promotional opportunities or a retailer will require that you contribute to a fund.  
• Mark Downs - This is a fund you would accrue for use in liquidating slow moving inventory from a retailer.  Many times retailers will not mention this, but will come to you later asking for money to help move stagnate product.  It is best to accrue for this on your own so you have money when the time comes.  For example; some club stores do not transfer merchandise from warehouse to warehouse which means you might get an order from warehouse A, while getting a markdown request from warehouse B only 5 miles away.

It is important to note that some retailers will negotiate program costs with you upfront and will deduct the negotiated percentage direct from the invoice when paying you.  Other retailers will not negotiate this upfront, but will still make deductions from your invoice when paying.  

What is Net Margin - I calculate Net Margin is your “Gross Margin” minus all of your program costs. 

What is adjusted net margin and what should this number be to keep your business moving forward - Adjusted net margin is your “Net Margin” minus any rep or broker commissions.  If possible always insist that you pay commissions on net margin.  In some cases the broker or rep will be the one negotiating the program costs and he or she will be more likely to negotiate better on your behalf if their commission is affected.  Achieving the best ANM will depend on several factors including your business structure and volume.  Generally I like to see Club Store ANM above 25%, regular Big Box above 35% and Specialty retail above 45% if possible.

How to guard against knock offs by pricing your product correct the first time - Today’s manufacturing is much different then in years past.  It is very common for companies to have product produced overseas, a world away from where their company resides.  It can be costly to spend the needed time overseas to manage the manufacturing process and as a result companies send their product ideas to overseas factories in an effort to get product produced cheaper and more efficiently.  The most common fear I hear when companies are shopping for a factory to produce their goods is they do not want to get knocked off.  While this is a legitimate concern it cannot keep you from moving forward.  There are two strategies, I believe, will give you the best protection against knock off product if it shows up.

• If at all possible be first to market and establish your product brand as the authority as quickly as possible.  In the bedding market there are plenty of competitors to Tempurpedic, however customers still prefer the Tempurpedic brand over the competition as they were first to really bring memory foam mattresses to market in a big way.

• Price your product to be competitive right from the beginning.  Gouging the customer simply because there is no current competition will not serve you in the long term.  When the knock offs come calling, and they will, the buyers who carry your product will be reluctant to change if the difference in price is not more than 15%.  However, if you went out with high cost and the competition is now knocking at a much lower cost and retail, the buyers will be more likely to seriously consider it.

The difference between pricing your product on your website and pricing it for a retailer. - Many retailers will begin by selling their products on their own retail website, which I encourage with all my clients.  I am always reluctant to work with clients who are not willing to sell their own products directly to the customer.  When selling online the pricing formula is simple.  It costs X to make my product, I sell it for Y and get to keep the difference.  Once you establish this retail online it becomes known and can be difficult to adjust later.  When you begin selling your product to retailers they will want to use your current online retail or lower as their go to market retail.  Now you must take your retail and deduct 40-65% margin that the retailer will want, program costs they will want your company to pay and then finally your cost of goods.  What is left over, at this point, can be to little to run a company and in some cases flat out in the negative.  Because of the above it is important to establish your entire pricing structure right from the beginning.  Below are some categories to consider when creating your pricing structure.

• Big Box retail
• Specialty retail
• Club store retail
• E-tailers
• Department store retail 
• Your website

Getting ready - To recap, below is a list of the items you will need to create the cost structure you will quote to the retailers you are wanting to carry your product.  Have fun and good luck.

MSRP - You must have an idea of what your product will retail for (see MSRP noted earlier in this article).  

Margin - If you don’t yet know what margin your target retailers are looking for you can obtain help with one of our pricing worksheets.

Program costs - If you don’t yet know these numbers check out one of our pricing worksheets.

Raw landed product cost - We can’t help you here.  In order to finish your pricing you will need to have this number.

Rep or broker commissions - If you will be using a rep or broker and have negotiated their commission rate you will need to have this number handy.

Units sold - This section is where you will estimate your units sold to this retailer for a 12 month period.  Creating this number will also help you with your volume projections and production planning.

For additonal help with your pricing please visit my website.  We have several step by step, easy to use pricing templates that will help walk you through the entire process.