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Selling to Hardware Stores – Part 1

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{Don Debelak’s new book, Turning Your Invention into Cash is now available on Amazon for $3.49. Go to Amazon.com and enter inventions Don Debelak to purchase. From the author of Entrepreneur Magazine’s Bringing Your Product to Market.}

Hardware stores can be a great opportunity for inventors. The hardware industry not only is open to inventors, carries a wide range of products and has stores in every part of the country, but also the hardware industry offers inventors a good way to build sales, first selling through independent stores, taking on sales reps, then getting into small chains and then eventually selling through distributors or the big retailers. In this is a three part series on selling to hardware stores, I will cover: how an inventor can develop a business selling to hardware stores (Part 1), how to set up a joint venture or partnership arrangement to help sell to hardware stores (Part 2), and how to license a product to the hardware industry (Part 3).

Selling to Hardware Stores – Part 1

Learning about the Industry

From the moment you have a new idea that you want to pursue, you should start learning about the industry and how products are sold. You can typically do this by leaning about: the major trade associations, trade shows and trade magazines; local independent sales reps; hardware store distributors; and the market approaches other inventors have used.

Industry Trade Activities

In the case of the hardware industry the key trade associations, shows and magazines are:

Regional trade shows include:

  • Ace Hardware Corp. Fall Convention, Oct. 28-31, Orange County Convention Center, Orlando, Fla. Contact Ace Convention Dept., (630) 990-2706.
  • Blish-Mize Fall Market. Sept. 24-25, Overland Park Convention Center, Overland Park, Kan. Contact (913)367-1250.
  • Bostwick-Braun Co. Fall Dealer Market, Sept. 23-25, Seagate Convention Centre, Toledo, Ohio. Contact Damian Nicholson, (419) 259-3600.
  • Do it Best Corp. Fall Market, Oct. 9-11, Indiana Convention Center, Indianapolis. Contact Rosie Wilson, (260) 748-5316.
  • Handy Hardware Wholesale. Fall Market, Aug. 12-14, Henry B. Gonzalez Convention Center, San Antonio, Texas. Contact Mickey Schulte, (713) 644-1495.
  • Home Hardware. Fall Buying Market, Sept. 12-14, Walter J. Hachborn Distribution Centre, St. Jacobs, Ontario. Contact (519) 664-2252.
  • Horizon Distribution, Inc. Annual Dealer Market, Sept. 10-12, Convention Center, Yakima, Wash. Contact Connie Alseth, (509) 453-3181.
  • House-Hasson Hardware. Summer Dealer Market, July 15-17, Cincinnati, Ohio. Contact Mike Woolf, (865) 525-0471, or mwoolf@househasson.com.
  • Orgill Inc. Fall Dealer Market . Aug. 12-14, McCormick Place, Chicago. Contact Judy Smith, (901) 754-8850.
  • Standard Hardware Distributors Inc. Fall Show, Sept. 29, Standard Hardware Distributors Warehouse, Merrimack , N.H. Contact Joan Varney, (603) 424-2141.
  • True Value Fall Market. Sept. 13-15, Las Vegas Convention Center, Las Vegas. Contact Susan Katz, (773) 695-5175.
  • United Hardware Distributing Co. Fall and Christmas Buying Market, June 18-21, Minneapolis Convention Center, Minneapolis. Contact Rick Mattson (763) 557-2714.

You want to start receiving the trade magazines, attend trade association meetings in your area — the national retail hardware association has local meetings — and you should attend at least one trade show to get a feel for how you might want your booth to be designed in the future. Trade shows are also opportunities to meet inventors that have been successful and to meet independent sales representatives and distributors that could carry your line.

Locating Local Independent Sales Reps

Once you start getting trade magazines look for the new product section. As a rule, they will be a large number of new products. You should request literature from any product that would be carried in the same part of the store as yours. Often this literature will come with the name of a local sales rep for the product. Either keep these names on file, or call the rep and ask him to lunch. Tell the rep that you are considering entering the hardware market and that you would be glad to buy them lunch if you could pick their brain for some ideas on introducing your idea. You can also meet reps when you attend association meetings or trade shows. At a trade show, no matter where it is, ask at booths if the company sells through independent reps and then ask which rep covers your area. Try to find as many reps as you can since not all of them will talk to you. You may also want to use a rep that you have a good rapport with to help you introduce your product. You will find it much easier to sell a product with a lead rep that knows the industry. Local reps who like your product can also help you get into five or six local stores where you can prove your product will sell.

Locating Hardware Distributors

Distributors typically are best when you have a well-established product, and inventors are typically better off establishing their product by selling the product themselves or using a local sales rep. You can find distributors for hardware products at these web sites.

Lean How Other Inventors Sell Their Products

You want to meet other inventors selling hardware products to: see how they have launched their product; receive advice on what steps to pursue; possibly consider a joint marketing arrangement; and possibly even tie into the inventor’s network of sales reps. You can find inventors by ordering literature from trade magazines and then looking up information on the web to see if it might be an inventor launched company, or by attending trade shows and talking to people at the booths to see if they might be an inventor company. In the case of the National Hardware Show, they typically have a section for inventor companies where they offer a lower booth rate.

Once you locate inventor run companies ask the inventor to explain how he or she was successful introducing his/her product, what tips he or she has for you to introduce your product, and see if there are any possible joint marketing arrangements you can work out. The best way to meet and talk to inventors is at shows early in the morning or late in the afternoon, when they aren’t busy with customers. You will get the most information if you can get the inventor to go to a meal with you and you have more chance to talk.

Developing a Broad Plan

If you do a good job of market investigation before you have your product ready to sell, you should a fairly good idea of what you need to do to successfully launch your product. You want to create a broad plan on how you will proceed. As you consider your plan, be sure to include in your analysis the money you have available. Your specific plan, which I’ll cover later, should include a budget that matches your resources. These are some of the elements to consider:

  • Are you going to focus on large chains, or smaller hardware stores?
  • Are you going to sell through reps direct to hardware stores, through reps to distributors or are you going sell the product yourself?
  • What type of pricing structure are you going to offer to reps, distributors and retailers?
  • Are you going to do a local marketing program first to demonstrate the product’s sales potential?
  • What type of promotional program are you going to have, including press releases, point of purchase displays and any advertising?
  • How many and which trade shows are you planning on attending?
  • Are you going to have any joint marketing agreements?
  • Are you going to have a master rep, who does the job of setting up the rest of the rep network? How will he / she be compensated?
  • Are you going to start with a list of premier targets that you will try to sell first, or will you go after the entire market?

Creating a Database of Independent Sales Representatives

Most inventors end up using reps at least partially to sell their products. So once you start working on an invention you should start creating a database of reps that you can approach once your product is ready to sell.

There are some industry directories available that are often available in larger libraries. These best one I’ve found is MANA, which is the Manufacture’s Agents National Association, 16 A Journey, Ste. 200 · Aliso Viejo, CA 92656-3317, Phone 949·859·4040, Toll Free 877·626·2776, Fax 949·855·2973.

But I’ve found it more effective when I can find rep pages for manufactures that list the names of the representatives. For example, http://www.detex.com/salesreps.aspx?id=2004 lists the independent sales representatives for Detex.com.

Once you start getting trade magazines, look up the Internet companies that sell to your target market. Often somewhere between 5 and 20% of the companies will list their sales agents. When you find a list, add the reps to your database. You can also try to get the names or rep members to National Associations for the hardware industry, and often tradeshows will have attendee lists where you can find the names of sales reps. In an industry as broad as the hardware industry you should be able to locate at least 500 to 750 potential representatives that could potentially sell your product.

Develop Your Specific Action Items

Decide on suggested retail, wholesale and distributor pricing and many other important factors.

Also decide on packaging and point of purchase displays, minimum orders, payment terms, sales flyers and other promotional material and manufactures’ sales representative commission rate. You should have at least two contacts in the industry you can run these points by before you finalize them.

Chose a target market area and target customer stores.

When starting sales you need anticipate problems. They might be in pricing, supply, packaging or Point of Purchase (POP) displays. Since you need to build sales momentum you want to be sure that your early stores have sales success. So choose a limited number of stores to be sure everything is working right before expanding sales. You might choose stores close to you, stores where you have a good relationship, or stores where your early sales representatives have good relationships. Be prepared to do whatever it takes to ensure sales success at these stores. Try to sell to initial stores prior to attending trade shows as show attendees will be reluctant to try a product that hasn’t sold. You also will have trouble lining up distributors without success in retail.

Decide on a sales strategy.

Will you work through representatives to sell to chain stores or to distributors or will you handle the sales yourself? If you decide on using reps, try to add no more than three at a time so that you can properly train the reps and go out on calls with them to help them gain at least some initial sales success. Don’t add too many reps at once or you won’t be able to train them properly and there is a good chance they will drop your product if you don’t have immediate sales success.

Determine what trade shows you want to attend.

I highly recommend you attend a trade show prior to exhibiting so that you can see what other booths are like. Hardware shows, especially the national hardware show, have expensive booths and you need to have a booth the matches up well with other booths so you appear to be an established company. Also check out the type of literature and other pass-out materials at shows so you can be sure that you have all the materials you need.

Have a sales action plan.

You need to be very proactive calling on stores, calling with representatives and exhibiting at shows. For the first six months, make an action list of what you will do every week, and ensure you are spending a minimum of 20 hours per week on sales activities.

Create a press release program for trade and consumer magazines and also for web sites.

Include pictures of the product and a picture of the product being used with every release.

Create a budget.

You want a budget for the first six months of activities. See if you will have enough money to fund the first six months. Don’t count on any income from sales in this period. If you don’t have enough money go back and reset your activity list so that it reflects what you can afford.

Execute

Once you have your action list you just need to follow it to enter the market. Introducing hardware products is fairly expensive, and the list above doesn’t even include actually making the product. If the costs are higher than your resources, Part 2 of this series will cover how to form a joint partnership relationship to sell your product and Part 3 will cover how to license a hardware invention.

Related Services:

  1. Market Introduction Plans
  2. Finding Sales Reps
  3. Invention Evaluations

Do you need web content?  Don Debelak, who has written 15 books published by major publishers such as McGraw Hill and Entrepreneur Press is currently writing web content.  Check out more information at:

http://onestopinventionshop.net/web-content-writing-services

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