How To Get Into H.E.B Plus
Founded 113 years ago, H.E.B is a grocery retail chain that has made quite a large mark in the American retail market. H-E-B is an American privately held supermarket chain based in San Antonio, Texas, with more than 350 stores throughout the U.S. state of Texas, as well as in northeast Mexico. The company also operates Central Market, an upscale organic and fine foods retailer. As of 2017, the company has a total revenue surpassing US$25 billion. H-E-B ranked No. 15 on Forbes‘ 2014 list of “America’s Largest Private Companies”. H-E-B was named Retailer of the Year in 2010 by Progressive Grocer. Supermarket News ranked H-E-B No. 13 in the 2008 “Top 75 North American Food Retailers”. Based on 2014 revenues, H-E-B is the twentieth largest retailer in the United States. It donates five percent of pre-tax profits to charity.
The range of products offered by this retailer include: Bakery, dairy, deli, frozen foods, gasoline, general grocery, meat, pharmacy, produce, seafood, and snacks.
The company operates several manufacturing facilities in Texas, including one of the largest milk- and bread-processing plants in the Southwest. H-E-B produces many of their own-brand products, including milk, ice cream, bread, snacks, and ready-cooked meats and meals. These and other private-label products are sold under various brands, including “Central Market Naturals”, “Central Market Organics”,”H-E-B”, “H-E-Buddy”, “Hill Country Fare”, “H-E-B Creamy Creations” ice cream, “H-E-B Mootopia” milk, and “H-E-B Fully Cooked.”
There are a lot of customer reviews online about this retailer. A customer noted on yelp.com that: “I frequent this HEB Plus at least twice a week! I love the design of the parking lot and the extra touch of pregnant moms/parents with small children being able to park up front! As soon as I enter the store there is always a theme depending on what holiday it may be. This week-end is Mother’s Day; therefore, they have a beautiful flowers set up with streamers falling from the ceiling as well as chocolate covered strawberries being hand made by the staff.
I love that this is a One-Stop shop. If you are feeling under the weather there is a RediClinic available with very convenient hours. There is also a pharmacy, floral department, Auntie Anne’s, Bakery, Seafood Dept, and a small section for clothing.
My favorite part of the store is the clearance section. There are always wonderful items that may have a small dent that are at substantially discounted prices. This is the first section I try to visit when I enter the store, very nice finds.
I love the fact that HEB always has more than five lines open unlike Walmart. There are never extensively long lines so I am normally in and out. Even on a busy day like Mother’s Day there are quite a few lines open as well as self checkout so I am not waiting a long, long time with a few items.”
How to get your product into H.E.B Plus
- Understand you client: Before you spend a lot of time and money creating a product, you should know if anyone will want to buy it. Learn more about Market Research
- Learn if it’s protectable: Know if you can defend your product against cheap copies if it gets knocked off. Learn more about Copyright and Patent your product
- Test your product: Make sure that there’s a demand for your product and the customer understands what you are selling when it’s on the shelf and nobody is there to explain it. Learn more about Product Testing
- Perfect your pitch: Before you speak to decision makers, know your numbers, know your retailer and know your logistics in and out. Learn more about Pitching Your Product
- Don’t do it alone: If you haven’t been successful in retail before, a secret of success is that you can’t do it alone. Having great sales staff, customer support and marketing partners can take you from zero to success faster than if you tried on your own. Learn more about Retail Partnerships
Contact H.E.B Plus Buyer
Do not trust any “list” of buyers.
Typically retail buyers change either companies or positions every few years. This strategy helps retailers know that their buyers are not taking “kick-backs” and are selecting the very best product for the very best position each time.
Buyers are typically held to a very rigorous standard of sell-through volume that they must hit and because of this they are risk averse. Your job as a supplier or vendor is to convince them that the buyers going into the stores not only know about what you’re selling but are actively seeking the product in the store currently.
How to Submit a Product to H.E.B Plus
There are several ways to get a product placed in H.E.B Plus. However, most entrepreneurs only dream about getting their product distributed to major retailers, few actually do it. We have experienced a significant rise in interest since the show Shark Tank started airing on NBC. Mr. Checkout has had the pleasure of working with a few Shark Tank success stories such as KISStixx and 180 Party Cups which are now currently being distributed around the country to stores like Walmart, Target, Kroger, 7-Eleven and more.
If you envision your product would be a good fit for H.E.B Plus, we have a few steps to help you get your product on their shelves.
Here are the 6 steps you need to take to have your product placed in H.E.B Plus.
1. Start with the right questions.) Before you try distributing your product to H.E.B Plus, you need to ask yourself a few basic questions. Do you need to build demand for your product, or is there already a demand for it? Do you know that H.E.B Plus would be interested in selling your product? If you can strike a deal with H.E.B Plus, can you handle the production volume? Do you want to sell directly to H.E.B Plus, or do you want to license your product to a manufacturer that will handle distribution?
2. Be prepared to profit.) Does your product offer enough of a profit margin for H.E.B Plus? Can you sell your product at a reasonable enough profit to cover the packaging, shipping, commissions, marketing and wholesale distribution? Check H.E.B Plus guidelines for other fees that you will have to build into the cost of your product in order for you to be able to turn enough of a profit to make the effort worth your while. If you work with a discount retailer, they will try to strip your profits down to zero in order to keep their prices as low as possible.
The typical breakdown of margins are: If a products costs $1 to produce, that product will retail for $4. That product that retails for $4 will wholesale for $2 to distributors and stores that purchase direct. Big box retailers like H.E.B Plus may offer to pay $1.25 to the manufacturer if the product costs $1 to produce. That is the typical profit margin.
3. Determine if H.E.B Plus is the right store for your product.) The relationship between you and H.E.B Plus starts with you browsing their store for competing products. If H.E.B Plus already has a similar product, it is going to be very difficult to get your product picked up. Spend some time at your local H.E.B Plus to see what kind of products they are selling, speak to the manager and see if he thinks your product will sell well in their store. Picture in which zone your product would best fit on the shelf and keep in mind that the most precious asset that these big box stores value are their shelf space. Keep this information in mind when you are preparing your presentation to H.E.B Plus.
If your company is minority or women owned, check H.E.B Plus website and see if they offer specific opportunities for those designations.
4. Pitch your product to H.E.B Plus.) Decide whether it will be you or a representative to present your product to H.E.B Plus. Your presentation depends heavily on your strengths as a businessperson as they will most likely ask financial questions and logistics questions.
It’s common for companies to hire a broker to pitch their product to H.E.B Plus, as it will be more likely that your product will make it to the next stage if the individual pitching your product has industry knowledge or a personal relationship with H.E.B Plus. The percentage of commission verses, however generally a broker will take around 5% to represent your product to H.E.B Plus.
We at Mr. Checkout have experience dealing with brokers and know that there are several retail brokers that have poor business practices that can potentially damage your brand. If you are seeking a legitimate H.E.B Plus broker, please give us a call for a recommendation. It could save you a huge headache and a lot of money.
5. Complete the required H.E.B Plus paperwork.) Often H.E.B Plus will have you go through an application process. However, before submitting the paperwork required by H.E.B Plus, you should contact a buyer at H.E.B Plus and let them know your intentions. Having a contact inside of the company will potentially move your application more smoothly through the process.
6. Anticipate the need for increased volume.) Having H.E.B Plus agree to stock your product will most likely mean a significant increase in volume. You should be prepared to ramp up your production and informing your manufacturer of this opportunity.
Having production, logistics and distribution to sync is not only difficult, it requires a significant amount of time invested in customer relations. Also, H.E.B Plus may have stipulations in the contract that may penalize you for delays in shipping and production. Have an attorney explain all contracts to you if you don’t understand the terms.
If you’re looking to sell your product to H.E.B Plus, be sure to thoroughly assess the marketplace, carefully prepare for production growth, and take full advantage of resources available to help you grow your business.
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