What’s a rack jobber? It’s a wholesaler with a particular niche product who stocks retail outlets with those products but maintains ownership until a sale is made. In essence, those goods are there on consignment. The jobber checks inventory and restocks the shelves on a regular basis. At that time, the retailer pays the wholesaler the wholesale price on the merchandise that has gone out the door, keeping the agreed-upon amount of profit.

What the retailer gets out of this, most importantly, is that he does not pay the wholesale price up front but only after the merchandise is sold. What the wholesaler gets is the ability to maintain what is, in effect, a small retail outlet of his own within a very favorable sales environment , and he does it without having to pay for the real estate taken up by his “store.” He does not have to carry the cost of clerks at his “stores” to process sales; the host retailer provides that.

There is no reason for a store owner or manager to turn you down when you offer to place merchandise free of charge. There is no risk involved for him, therefore it is not hard to get you initial accounts setup. I will caution you in one area and that is shrinkage or theft. Make sure to advise the store owner that he will be invoiced and responsible for those items that are stolen. Theft is an inevitable occurrence when retailing and it will affect your rack jobbing business. 

Multiply your racks over a number of retail outlets, and sales figures will soon mount up – assuming you have a good product suited to rack jobbing and you contract with good host retailers. Once you have a good number of stores setup you will want to service them on a weekly or bi-weekly basis making sure empty displays are filled and slower moving items are replaced with other merchandise. 

Chances are, you’re not going to come up with a new idea for rack jobbing that drug stores or supermarkets haven’t seen; they already handle DVD’s, books, clothing, novelties, and more. But genius ideas for rack jobbing can come from putting two separate ideas together, like dogs and books, for example: Stock books about pets and pet-centered magazines in veterinary offices.

Here are a few more ideas to get you started:

• Jewelry & watches at hair and nail salons
• Sell games at liquor stores…Who does not like to play games while drinking?
  
• Impulse novelties at convenience stores and gas stations
• Handbags or purses at apparel stores

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Shopify (www.shopify.com) is one such solution. They’re based on Ruby on Rails, and several other open source projects. That means that there is an active development community behind the features. New features and improvements are added regularly, and they’re all based on an architecture that is inherently easy to scale. Best yet, they have a trial account option. This allows you to dive in, get a feel for what the store has to offer, and even process a few orders. Once you really get started, of course, you’ll have to upgrade to a real plan, but it’s very handy to be able to bring yourself up to speed without paying a dime.

Shopify’s system allows you to edit the site templates directly through their admin tool or run your site locally to allow you to mess with everything in the safety of your own computer. They have tons of tutorials, documentation and help links throughout their admin panel. They have tools that will help even a non-technical person make quick changes to their site. Want to add the price to the product preview? No problem, they give you the code to put in. Want to add a blog to your site? It takes about ten seconds to add a blog to your site.

In addition, all the templates are designed to have excellent SEO. They’ve already built in the HTML tags you’d want to use and you write in a syntax that’s similar to some blogging tools; you don’t need to know how to program a website at all. The CSS is all designed to make your site fast, reliable and the same across all browsers. You can do custom templates from the ground up, of course, but it’s very easy to start from one of their free templates and go from there.

How does Shopify stack up against Yahoo! Store? It’s a very important comparison, as Yahoo is one of the biggest hosted shopping solutions on the internet.

First, if your site becomes fabulously popular, Shopify’s Enterprise level plans have a lower transaction fee than Yahoo! Store. That can mean tens of thousands of dollars saved per year if you’re doing enough business. The downside is, however, that on a small site, the fees are slightly higher than their Yahoo counterpart.

Second, there’s a major difference in the way the site’s pages are generated. Yahoo’s templates are used to generate static pages. This means that dynamic content like up-to-date stock counts are very difficult to have added to your product pages. Shopify is a true dynamic platform and adding such content is usually one line of copy-and-paste code. Also, Shopify built Google Analytics directly into the platform, and it’s fairly easy to add your own third party widgets until your heart’s content.

Third, the pricing is a little different. Yahoo requires a small set up fee to start a new store. Shopify doesn’t, but as I mentioned has slightly higher transaction fees on small sites.

In general, you’ll find Shopify to be an easy-to-customize option. They have their own quirks that some users will like and others may not. However, their free trial makes it easy to prevent making a premature decision. It’s always nice to be familiar with the operation of your store before you have to pay for it, or before your customers start ordering from you! In either case, you can only make sales if you have a site going and most options are fast to implement. Good luck!

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As a retailer, you work with a lot of manufacturers, and a lot of brands. Each manufacturer has their own brand image and their own ideas on how they’d like to see that brand represented. While their brand might be a useful sales tool, sometimes brands can be more like an ego which needs close attention.

Using the brand/ego analogy sometimes confusing manufacturer behavior becomes far easier to empathize with. Many manufacturers will employ a MAP policy (Minimum Advertised Price) and will often enforce this policy to the extent of terminating your ability purchase and resell their products all together. They [manufacturers] feel their product is worth a certain amount and it frustrates them to see it sold for a lot less by everyone, so they make it a rule. Manufacturers may also have an IMAP policy (Internet Minimum Advertised Price) as web retail stores interact with one another in a much different fashion than geographically separated physical stores.

In addition to MAP and IMAP policies, there are some manufacturers who limit what sales channels they’ll allow a retailer to use. For example, some prefer that you not list their products on Amazon.com. Why? Unlike an ordinary comparison shopping engine (CSE, e.g. Bizrate, Froogle), where the user is redirected to your unique shopping site, Amazon handles the entire transaction. CSE’s could be compared to a mall, where Amazon is more like a garage sale.

A manufacturer may not like seeing their brand and product tossed in with the rest of the junk in the garage, with no respect or individual consideration. Also, while a CSE allows you to sort by price, it usually can sort by store rating as well, helping assure the customer the best purchasing experience possible.

As a web retailer you should understand the above concerns and note some manufacturers will be more sensitive than others. It is important to keep track of the rules you’ve agreed to follow for each of your manufacturers. If you don’t cater to the needs of their brand, then you could easily find yourself cut off! You’ll be searching for replacement products to fill that gap in your offering, and may have hurt your reputation with other manufacturers in the process!

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Shopping with the wife this weekend we found ourselves at Walmart pushing a cart aisle by aisle. While many people are opposed to Walmart’s market share I do find it fascinating that in the face of roughly forty years Walmart has become the worlds largest retailer. I highly recommend reading Sam Walton’s book, “Made in America” as the story of Walmart growth is enough to inspire any entrepreneur.

As we were walking through Walmart shopping for necessities I noticed the tremendous amount of “Private Label” products offered. From Dog food to soda pop the Walmart name is branded on several items in fact through further research I found out that approximately 40% of all items sold in Walmart are private labeled.

What is private labeling?

Private labeling is simply the act of contracting with a manufacturing company to produce your own line of products with your chosen name brand. There are literally hundreds of manufacturers who are willing to produce a single product or complete product line thereby enhancing your business image and strengthening your relationship with your customer base.

Why would you want to private label?

Simply put, There’s no better way to support your store brand than to sell products bearing your store’s name. Your brand can create recognition in your geographic market whether your plans are to market locally, regionally, or nationwide there is a private label solution available.

Some examples of the more popular products which are private labeled include lotions, skin care products, cosmetics, perfumes, jewelry, apparel, home décor, snack foods, candy and coffee.

Here are a few examples of private label manufacturers who deal in small quantities:

Grafton Cosmetics – offers dedicated sales advisors who will walk you through the very necessary steps to guarantee that the development of your brand meets your business goals and your marketing strategies. Grafton Cosmetics offers a total private label solution from graphic label design to product manufacturing. Based in Florida – toll free 800-662-5387

Mister Snacks – offers dozens of snack lines for small to large retail stores, regional distributors, large supermarket chains, cruise lines, colleges, promotional campaigns and everything you can imagine. Let their creative artists help you design the look you want or you can provide your own logo. Based in New York 716-691-1500

Style Source Inc – Private label apparel manufacturer offering dresses, skirts, tanks, wraps, sarongs, pet apparel, maternity apparel and dozens more. Able to provide specific size ratios, labeling, packaging and many other value added services. Based out of North Carolina 910-399-2288

Autocrat – In business since 1895 retailers can develop a partnership with Autocrat’s private label coffee program.. Autocrat offers selling support that is committed to championing your growing business with package design, brochure assistance and growth incentives. Based in Rhode Island 800-288-6272

Nutricap Labs Offers private label solutions for the supplement / vitamin industry which will offer the ability for your business to build brand loyalty among your customers. Superior products at the most competitive prices offering cutting edge label printing and packaging design services. Based in New York 800-494-6154

Companies listed above are a sampling of manufacturers who are ready to produce your products under your business name.

For more information the Wholesale private label industry offers an annual trade show which is coming up August 16-18th in Chicago. More information can be found at the PLMA website or by calling PLMA direct at PLMA 212-972-3131

Private Label Fun Fact - Walmart’s, “Ol Roy” dry dog food is the Nations second best selling behind Purina. “Ol Roy” is exclusively manufactured by Mars, Inc., owner of Pedigree, Sheba and Whiskas pet foods. Ok, maybe not necessarily fun…But interesting-

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