What to Expect When Selling to a Department Store
2010/09/02 6:00 AM
Do you ever find yourself dreaming about your product being sold in a Department Store and just know you’ll feel like you’ve really made it when you are being sold in one?
I used to feel that way too. But as I grew my handbag line, I came to realize that a product line built on the strength of boutiques is much better off in the end. The bottom line is that Boutique buyers are much more loyal at the end of day. That said……Dept stores do have their allure and high power appeal.
So what to expect if one comes calling?
- These days you can expect to be asked to do consignment to start.
- You can expect them to ask for a discount.
- You can expect a smaller PO than anticipated.
- You can expect them ask if they can return whatever is not selling well – or ask you for markdown money.
- You can expect them to pay for freight to their Distribution Center (DC) but not always.
- You can expect a HUGE pdf of their shipping guidelines, and yes you need to read it.
- You can expect charge-backs if you don’t follow all the rules in the shipping guidelines.
- You might be asked to participate in a catalog fee.
- You might be asked to do a trunk show in a specific store.
- You will want to promote this as much as possible to drive sales.
- You will need to be EDI** compliant.
- You might need a factor***.
- You can expect to be paid in 30 days unless otherwise noted on your PO.
I’d stick with the boutique building strategy for a while……until you have at least 200 boutiques you can count on each season.
** EDI is Electronic Data Input – and is an internet based system for receiving your PO’s, managing your inventory and UPS codes and ticketing for stores. There is a lot more to it and you can check out this company that does it for you.
*** A Factor is a company that provides you with working capital by advancing you 80% of your invoices once you ship. they of course take a percentage of your sales for their troubles but can be a life savior too. For more information on factors, click here.
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There are 17 comments
Stacey Kannenberg says:Such great information, I have to share!
Great post, Sarah. And I totally agree with you.
I learned everything you mentioned here when my product, Blankeaze, was picked up by the One Step Ahead catalog. 😀
Awesome info, thanks for sharing!
Heather
Hi Sarah,
I really enjoy the information you post. I am learning so much. I have not been approached by a department store yet. (I wish!) 🙂
But if that ever happens I will know what to expect. If you have any information on how to work with distributors I would that too.
Thanks and have a great day,
Hugs,
Janet Bernasconi
Janet’s Creative Pillows
GREAT information Sarah!!! Seems it would be so fabulous to have my product in department stores thinking it might be extremely profitable – after reading this – I’ll stick with my boutique and grow from there. I like seeing the big picture and you helped with that….thank you!!!
Michelle
Thank you Sarah. This is very helpful as well as all
the other great info you have given us in our consultations
with you.
Thank you, Sarah. I look forward to your posts and always feel much more comfortable in this daunting business after I read them.
Thank you!!
Hi Sarah;
This is great information – I just referred two clients to this post and tweeted it out.
Thanks so much.
Hi Sarah,
I have just joined the blogosphere and am checking out what other female entrepreneurs have to say. Your blog has so much good info, thanks for sharing!
i old school walked myself into the casinos in Las Vegas to sell my suits. I got an appt at the Wynn with the assistant buyer as the “Buyer” was at paris fasion week. Although they didnt pick up the line, the experience was VERY educational. I’m much more comfortable working directly with shop owners, i want them to believe in me as much as i believe in them!
Thanks for the information Sarah! I have wanted to get into the larger retailers but have taken your advice and now I am trying to grow my boutique business. I would love some tips on how to grow boutique business.
[…] What To Expect When Selling to a Department Store […]
Sage advice. I’ve also come to realize that in our case, going the department store route as a start-up might not be a sound route to go with. We’ve penetrated the optical industry through a reputable distributor that has been in business for 30 years with a client base in the thousands. Best part, they pre-pay. Our distributor is also a privately owned company & thus empathize with our challenges as a small & growing company. It’s a win-win!
Thanks for sharing Sarah.
Lani says:I sell to a department store and would like to sell into boutiques. Great advice!
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