How to get your product on the supermarket shelf

Getting your product on the supermarket shelf can turbo-charge your sales. Marc Barber finds out how it is done.

‘Trying to get products into a supermarket is tough. When I originally approached them they all said “no” to the idea. It was really difficult to get through to the buyers.’

Wilfred Emmanuel-Jones is the man behind The Black Farmer food range and his early experience of dealing with major stores such as Tesco, Asda, Sainsbury’s and Morrisons is all too common.

It took Praveen Vijh, Eat Natural’s co-founder, five years before the group’s healthy snack bars hit the supermarket shelves. ‘It could take that long or it could take a couple of months,’ he comments. ‘Financially, it’s a struggle, but we didn’t build our business model on selling to supermarkets. Our business model was on supplying to other independents.’

Today, 60 per cent of Eat Natural’s sales are generated via supermarkets. Vijh made the breakthrough by targeting the specialist product categories between the aisles.

‘There isn’t just one part of the supermarket where you can sell your product. We went for the more niche areas like organic and speciality food. If it’s less high profile, it may give you an easier route in.’

After Emmanuel-Jones was rejected, he decided to travel about the UK and conduct a massive sampling exercise of his sausages and poultry. ‘I built a website and it has a petitioning page, so when people like the product – and it is a pretty outstanding product – I ask them to go on the website and demand that the buyers [for the supermarkets] do buy it.’

Consumer power

After a year of direct action, a supermarket gave Emmanuel-Jones a regional listing. Then deals were agreed with the other stores: ‘The only thing supermarkets fear are consumers, so what you have to do as a small operator is realise that the most precious thing you have are your consumers. Often, people forget that and they waste a lot of time and effort trying to persuade the supermarkets to buy.’

Unlike Vijh at Eat Natural, Emmanuel-Jones’ goal from the outset was to be on sale in the major stores: ‘The whole point of The Black Farmer brand is to be an affordable premium available to supermarkets. I’m not one of those people who are interested in the independents in a big way.’

Both Vijh and Emmanuel-Jones agree that if you are to stand any chance of mass distribution, then you have to demonstrate to the buyers that your product will sell.

‘It’s essential to build a brand name. Then the supermarkets will look at you as someone who has a bit of history and some pedigree,’ says Vijh, noting that it’s useful to target some of the smaller stores in the early days like Costcutter and Whistle Stop Foods.

Emmanuel-Jones comments that you have to prove you can meet demand: ‘[Buyers] don’t like small suppliers as they’re seen as a nightmare. One of the things that worked in our favour was we made sure we aligned ourselves with the big [distribution] players.’

‘Simply going to big supermarkets and saying “this is what consumers want” won’t work. You have to demonstrate the logistics of how you can deliver. There needs to be an understanding of what the supermarket’s problem will be.’

Landing a deal may be a slog for the majority of owner-managers, but fairy tales do happen. After Levi Roots went onto the BBC’s Dragons’ Den and sang about his home-made Reggae Reggae Sauce to secure funding from Peter Jones and Richard Farleigh, it seemed things couldn’t get much better. But they have. A lot better, in fact.

‘Reggae Reggae sauce is the fastest-selling condiment in the whole history of Sainbury’s,’ says Roots, who has to pause mid-conversation to go and turn some jerk chicken.

Over 500,000 bottles of the sauce have been sold since distribution started in February last year. Although Roots – who isn’t afraid to refer to himself in the third person – has certainly benefited from doors being opened by Jones and Farleigh, he stresses that he’s in charge of strategy: ‘As for running the company and being the face of Reggae Reggae Sauce, it’s really Levi Roots that people are buying.’

As the business has taken off and production has been scaled to meet demand, Roots has been acutely aware of protecting his own brand. ‘The love for Reggae Reggae and Levi Roots is from a specific type of people. The market is largely coming from student types and young people.’

To keep that appeal, Roots says he has been very hands-on to ensure the product is presented correctly: ‘I had one company offer me in excess of £1 million to produce the first Reggae Reggae pork rib. When you’re talking about integrity, the British public see me as a Rasta and they like my honesty. The whole thing about Rastas and pork doesn’t really fit well together.’

Building a brand

While a quality product certainly helps, a powerful brand will give it longevity if it’s to survive in the supermarkets. Emmanuel-Jones says: ‘Most [of the supermarket] buyers are there to protect their own-label products.

If you go to the sausages section, most of them will be own label. ‘Their job is to make money for their brand. Not only that, if they’ve already got an own-label pork and leek sausage, they won’t be too interested in taking your version of that product.’

Unsurprisingly, the supermarkets will usually take the premium, obvious brands, so the trick for a small operator is to be innovative. ‘But you can’t have something that is so far ahead that the consumers won’t buy it,’ says Emmanuel-Jones. ‘You really have a small area in which to innovate and make money.’

The alternative is to make products that carry the supermarket’s own brand. Clive Beecham has been involved in the food industry for over 30 years and says getting to meet buyers is probably as hard today as it was in the 1970s: ‘I remember a buyer in the early days from Allders in Croydon actually telling me to pack my bags and get out of there.’

Beecham set up a confectionery specialist Kinnerton – sold three years ago to Zetar, where he is a managing director – specifically to sell own-label products.

‘The marketing machine that we took on board was Disney or Paddington Bear or Thomas the Tank Engine. So rather than Clive Beecham’s easter egg, it was the Thomas the Tank Engine Easter egg,’ he says.

Over the years, Beecham has found that the supermarkets’ approach to selling borders on the scientific: ‘In the old days, it was more about: “I like your product and I’m going to put your product on the shelf.” Now it’s about: “If I’m going to put your product on the shelf, how do I know it is going to perform?”’

Emmanuel-Jones certainly agrees: ‘Supermarkets operate on the basis that if something is working for them, you have to establish what your proposition is and how it will earn them more money. It can’t just be the same amount, as their response will be: “Why should we take the risk?”’

The competition is furious, says Beecham: ‘The supermarket has always been the be all and end all. But when I started out, there were more supermarkets. You could triple the number and so the cost of losing today is greater. Can you afford not to be in a retailer that has 80 per cent of the marketplace?’

If you’re Lise Madsen, founder of Honeyrose Bakery, then the answer is an emphatic yes. Since setting up the company in 2001 with £70,000 from five investors, she set about targeting independent outlets with her organic, hand-baked products.

‘Our first customer was Planet Organic,’ she says. ‘At first I thought the organic market would be our main customer. It has turned out to be about more conventional customers who are looking for quality products.’

At present, the company has sales of £2 million but that is set to double over the next 18 months after a distribution deal was signed to roll out cakes, cookies and muffins to 107 Waitrose stores. The decision wasn’t taken lightly by Madsen. ‘It’s the only supermarket I feel comfortable dealing with,’ she says. ‘I don’t want to feel part of what [other supermarkets do]. I don’t want a single crumb of my business to contribute to their profits.’

From a commercial viewpoint, Madsen believes relying on supermarkets leaves your business vulnerable: ‘If they can get the same product elsewhere, cheaper, even if it’s for half a penny, they will. It’s the bottom line that drives these companies.’

It’s a committed and highly personal stance that defines the direction and strategy of her business. The company is moving to a £2.5 million new factory, which should quadruple capacity.

She insists that she is ‘an entrepreneur, as the business proposition does have to make commercial sense. But I don’t want to do anything that my conscience doesn’t allow me to do’.

Be that as it may, for the majority of entrepreneurs, the supermarkets are vital as they present the largest opportunity to achieve scale. Emmanuel-Jones says: ‘The key about the food business is you really only make money with volume. And volume is about distribution. So the big challenge for us is always about more distribution.’

And that means carrying on the fight to get on more shelves.

Marc Barber

Raven Connelly

Marc was editor of GrowthBusiness from 2006 to 2010. He specialised in writing about entrepreneurs, private equity and venture capital, mid-market M&A, small caps and high-growth businesses.

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