Checklist, contacts and process for dealing with major supermarkets in NZ
Expanding your business into supermarkets is an exciting step to accelerate your business. With over 500 stores around the country across Countdown, New World, Pak’n Save, Four Square, Fresh Choice, Supervalue (and more), its a way to reach nearly every New Zealander and drive sales & exposure for your brand.
Making the decision to sell in supermarkets means a step change in complexity of dealing with larger organisations and making sure you have your systems & process all ready to go. This can feel a bit overwhelming, so we’ve pulled together some initial links, thoughts starters and tips so you can find out more.
A FEW THINGS TO CONSIDER:
How good are your process especially around stock management, orders and customer service? Supermarkets expect service levels of 95%+ so you need to be sure that you can deal with fluctuations in orders and keep them in stock all year round.
Is your margin model and pricing structure set up to cover all the extra sales, wholesaler and marketing costs? Selling direct to independent stores - or directly through your website - means your margins are often generous and it is a relatively simple pricing structure. There are a lot of additional costs including trading terms, wholesaler trade spend, promotional pricing and retailer marketing that can have a significant effect on your margin. Having a detailed margin model so you can afford to deal with supermarkets is critical to enable your long term success and viability.
How can you deal with stores & sales? When dealing with Foodstuffs stores (especially in North Island), you will need to go into each store and deal with buyers, get the product onto shelf (merchandising) and make sure that they reorder. This can be a great way to learn a lot about how stores operate, but is also time-consuming and expensive if you try to do it all yourself. There are options of Brokers, Sales Agencies or Distributors that deal with a wide range of small suppliers so you can outsource. This comes with a cost and you should consider what is best for your business and ambition.
Where do your consumers expect to buy your product? If your product is a high-end niche product that requires a lot of education, it may be a challenge to sell this in mass supermarkets as your rate of sales will be low, and there are minimal chances to engage with consumer instore as people’s attention spans are short. Selling to the ‘right’ retailer is a fundamental must-have in your growth plan and its critical that you can explain to the Category Buyer why consumers will be wanting to buy your products in THEIR stores. They are always looking for ways to attract new consumers, sell more, and sell higher value - so the more you can tailor your brand sales pitch to answer this, the better your chances of success!
USEFUL LINKS & CONTACT INFORMATION
FOODSTUFFS NORTH ISLAND
Foodstuffs North Island is the central business that you need to go through if you want to sell in New World, Pak’n Save or Four Square in the North Island. Although stores are individually owned, there is a central Head Office that deals with setting up new products, suppliers, pricing etc. You need to go through this process before you can sell to stores.
The first point of contact is with the Category Manager that looks after your products instore. There are lead Category Managers for all major categories in store, and they deal with all suppliers, products and pricing.
https://supplierhelp.foodstuffs.co.nz/en/article/category-managerscontact-list#retail > this is the list of Category Managers for Foodstuffs North Island
https://supplierhelp.foodstuffs.co.nz/en/article/contacts-for-new-suppliers
There are two different ways that you can work with stores - Store Specific (direct) or Charge Through (warehouse) - and each has pro’s & con’s depending on how you are set up and want to operate.
Instore only > This is called selling ‘Store Specific’ and you will need to manage stock delivery to store.
Get to understand the grocery industry
Build local relationships
Launch local/new to market product
Test product/price versus the category
Build market and gather insights
Hosted by Foodstuffs > This is called ‘Charge Through’ and means your product goes into their Distribution Centres (DC) and they organise sending to store
More distribution (via DC if applicable)
Stores adhere to ranging decisions
More promotional opportunities
Consistent retail pricing across all stores
We make shelf space available (planograms)
CHECKLIST:
FSNI provide a full checklist here > https://supplierhelp.foodstuffs.co.nz/en/article/downloads-and-new-suppliers-checklist - and below are some of the questions that are included in the list.
Have you submitted your product information via GS1 or DEX?
Find out more about it: https://foodstuffs.wixanswers.com/en/article/becoming-a-supplier#how-to-become-a-supplier
Have you got range that the Category Manager has approved?
Use the new supplier evaluation Powerpoint template to present your products. Otherwise, please discuss your range with the relevant category manager. Find your category manager contact details here: https://supplierhelp.foodstuffs.co.nz/en/article/category-managerscontact-list
Have you submitted your vendor account form?
Have you submitted your compliance package?
Have you submitted your eCommerce exchange application form?
Have you submitted your Foodstuffs confirmation of trade terms form?
Have you contacted Tony Richards/National PIM?
This is so that you can get your product information onto our central database. Find contact here: https://foodstuffs.wixanswers.com/en/article/contacts-for-new-suppliers#foodstuffs-national-pim-support-team
FOODSTUFFS SOUTH ISLAND - https://www.foodstuffs-si.co.nz/
Foodstuffs South Island (FSSI) deals with New World, Pak’n Save and Four Square stores in the South Island. It is a separate business to FSNI so you will need to go through the full process again with a different Category Manager and supplier set up. Just because you are sold in New World stores in the North Island, doesn’t mean you will be automatically accepted to sell in the South Island - you’ve got to prove the reason your brand is worth accepting instore.
FSSI publish their category review cycle so you can see when your category is next going to be reviewed. You should be preparing for this 2-3 months ahead of time and talking to your Category Manager about their process.
These are some of the different considerations that Category Managers think about when looking at new products. Look at this and make sure you know how you would respond. https://www.foodstuffs-exchange.co.nz/assets/documents/FSSI-Benchmarks.pdf
Their ways of working (sell direct or DC) is similar to Foodstuffs North Island, and they also operate with trading terms.
There will be different costs for dealing with FSSI so don’t assume that the trading terms and marketing costs for the North Island will be the same in the South Island
COUNTDOWN
Countdown has a more centralised model, so that if you are accepted by the Category Manager for ranging (being sold) instore, then you will be sold into all the stores that they decide.
You do NOT need to go and make sales calls to each store to try and get the product ordered and on shelf. Although it can feel more complicated (and possibly more expensive), it has the benefit of giving you nationwide sales and lower day to day sales administration and management.
Contact list for Head of Department. These are NOT the Category Managers, but will help you get in touch with the right person https://supplier.countdown.co.nz/contact-us/
BECOMING A SUPPLIER INVOLVES KEY STEPS
Step 1 Supplier registers on Partner Hub
Step 2 Submit your product for consideration
Step 3 If accepted, complete your supplier account details in Partner Hub and enrich article
Step 4 Agree on terms of supply (Trading Terms) and return, signed
Step 5 Supplier created and your new supplier number provided
Step 6 Finalising article submission
WHEN TO APPLY - CATEGORY REVIEW DATES
https://partnerhub.woolworthsgroup.com.au/s/how-to-become-a-woolworths-supplier
Look at the ‘know when to apply’ so you can search for the dates of your category review. There are generally only ONE or TWO times a year that a Category Manager will do a major category review
OTHER RETAILER CONTACTS
FARRO: A premium chain of primarily food & beverage stores in the Auckland region that has a target of high-value consumers often looking for the next ‘new’ thing. The stores are not large but they often have new trends and brands onshelf, and different expectations in terms of pricing, margin and instore activity.
HUCKLEBERRY: Similar to Farro but with more of a focus on natural & organic products, as well as a LOT of supplements and functional health food and drinks. Huckleberry uses the online ‘Rangeme’ platform for setting up new suppliers and products, so you can also use this across other retailers internationally.
