How to get your product into Schnucks
- 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
How To Get Into Schnucks
Founded in 1939, Schnucks is a supermarket chain. Established in the St. Louis area, the company was started in 1939 with the opening of a 1,000-square-foot (93 m2) store in north St. Louis and now operates 119 stores in five states throughout the Midwest. Schnucks also ran stores under the Logli Supermarkets and Hilander Foods banners. Schnucks is one of the largest privately held supermarket chains in the United States and dominates the St. Louis metro grocery market.
The retailer’s offerings in groceries include bakery, dairy, deli, frozen foods, general grocery, meat, pharmacy, produce, seafood, floral, snacks, and liquor.
The company is family owned, with the fourth generation now working for the company.
In 2007, the company started a campaign called “Recipe for Success”. Schnucks also began a program where it lowered prices on 10,000 items to be more competitive with Walmart. Schnucks leadership led the plan, which included making their employees knowledgeable on the food they sold.
In September of 2018 Schnucks announced the purchase of 19 Shop ‘n Save locations (14 in Missouri and 5 in Illinois; all in the St. Louis metropolitan area) from SuperValu, along with one standalone pharmacy in Union, Missouri and the prescription files from 10 additional Shop ‘n Save stores not included in the sale. This announcement came shortly after Schnucks purchased a former Shop ‘n Save in Maplewood, Missouri in August 2018.
Customers who have shopped from this grocer can best give reviews about its stores. Customers have reviewed this retailer online. A customer noted on yelp that: “There’s a pretty solid selection of produce, meats and fish, and baked goods here, too. You can find just about anything here you can find at any other Schnucks; you can find just about anything here you need. Prices aren’t awful. (I am not certain whether there’s extra city tax here or what, I’m still getting the hang of the system.) The employees are generally pretty friendly and, as a cooking novice, I find myself asking for directions within the store pretty often. I have never gotten one rude reply as I’ve searched for garlic chili paste, orange marmalade, or dried apricots.”
For a distributor, this is an established store that can get your products to move as fast as possible. With the awesome varieties they offer and the established customer base, it can be easily deduced that there are customers already dedicated to what they sell.
On the local sourcing of food products, Schnucks has been on the forefront of selling locally sourced food products and imported food items. Their wine, spice, and produce selection make them a leader in the retail and grocery business niche. This store has been in the business for years and has its established sourcing angles. Its constant support of local products has helped it cement its brand in the community as people can easily resonate with it.
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.
Sometimes easier said than done, however you must get on Schnucks radar.
Call the Schnucks corporate phone number and ask for the names of the buyer and assistant buyers in your category.
Always leave voicemail with whomever the dispatch will connect you.
Use that information to connect with them on LinkedIn, RangeMe and any other professional social platform.
Ask your representative at your trade bureau to connect you to the Schnucks buyers as they will potentially have a better history.
Use advertising, public relations and marketing to make your brand known to Schnucks buyer through 3rd party websites & industry media sources.
Be everywhere that they look, the key is to position your brand as the obvious choice when Schnucks is looking to either refill a slot or create a new category.
Latch on to the news of the day and any trend that will make your product fill that niche whether that be Non-GMO or Vegan Leather for example.
Investing in your brand can only benefit your opportunities in the future. As being “top of mind” will have a ripple effect when you physically present your product at a Schnucks buyers meeting or trade show in the future.
Schnucks buyers typically got to their position by picking “winners” and know how to see through the fluff.
Focus on the numbers, know your bottom dollar during a negotiation and how fees and chargebacks may cut into your position.
Know that long term success may outweigh short term sales, however financing large purchase orders from Schnucks when the net result is negative is not sustainable.
Understand the playing field and the other brands that are in your space, what they are offering as promotion and pricing and how you can stand out against them.
By knowing that each buyer at Schnucks probably knows more than you do, take an active listening approach to sales and understand that no is a perfectly acceptable answer that may have saved you millions of dollars on the backend.
How to Submit a Product to Schnucks
There are several ways to get a product placed in Schnucks. 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 Schnucks, 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 Schnucks.
1. Start with the right questions.) Before you try distributing your product to Schnucks, 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 Schnucks would be interested in selling your product? If you can strike a deal with Schnucks, can you handle the production volume? Do you want to sell directly to Schnucks, 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 Schnucks? Can you sell your product at a reasonable enough profit to cover the packaging, shipping, commissions, marketing and wholesale distribution? Check Schnucks 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. Retailers like Schnucks 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 is the right store for your product.) The relationship between you and Schnucks starts with you browsing their store for competing products. If Schnucks already has a similar product, it is going to be very difficult to get your product picked up. Spend some time at your local Schnucks 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 Schnucks.
If your company is minority or women owned, check Schnucks website and see if they offer specific opportunities for those designations.
4. Pitch your product to Schnucks. Decide whether it will be you or a representative to present your product to Schnucks. 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 Schnucks, 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 Schnucks. The percentage of commission verses, however generally a broker will take around 5% to represent your product too Schnucks.
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 Schnucks, please give us a call for a recommendation. It could save you a huge headache and a lot of money.
5. Complete the required Schnucks paperwork. Often Schnucks will have you go through an application process. However, before submitting the paperwork required by Schnucks, you should contact a buyer at Schnucks 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 Schnucks 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, Schnucks 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 Schnucks, 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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