Selling To Walmart

What It Takes To Sell To Walmart: A Senior Buyer Tells All

Once a year, Walmart opens its doors to companies, large and small, that make products in America. This year, that open call will be held on June 28, 2017, and entrepreneurs can apply to attend through May 18. Last year, more than 450 companies pitched more than 750 products; while only some got into the stores, all that could sell online were allowed onto walmart.com.  To explore what it takes to get a product on the retailing behemoth’s shelves, FORBES spoke with Kinna Thomas, Walmart’s senior buyer for cakes and pies.

Thomas, who joined Walmart five years ago from JCPenney, worked as a buyer of fine jewelry before switching to the bakery area, and she says she loves open-call day. She helped put together the deal to sell Patti LaBelle-branded sweet potato pies and fruit cobblers after flipping through the singer’s cookbook, a hunch that paid off. And she’s even cold-called small bakeries when she’s seen a dessert she likes. But entrepreneurs who want to get on the shelves, better be prepared to talk about their product and its market in detail and to figure out how to create a cost structure that works for Walmart. You can probably guess what that means.

Whether pitching Walmart at its open-call day or getting a scheduled hearing at its headquarters in Bentonville, Ark., here are five things to keep in mind.

Know how your product fits in to the bigger market: Walmart buyers have seen it all. Be prepared to pitch your product but also to explain how it fits into the broader market: What makes it special? “It doesn’t matter if they are big or smaller, experienced or new, we can work on things like that. I am concerned about the quality they have, and if it’s new and innovative, or if it’s traditional what sets it apart from everyone else,” Thomas says. “What we expect as a merchant is for people to come in who are prepared for the conversation. Being prepared means being knowledgeable about your product, and the industry as well. Know your competitors.”

Don’t be scared off by Walmart’s size: Walmart has more than 4,600 stores spread out across the United States, but that size also means that it can offer regional deals to new suppliers to test them out. “A lot of people say, “Oh, Walmart is so big. We have a lot of stores, but we have the ability to segment those stores as well,” Thomas says. In fact, she says, she’s willing to do a deal for as few as 50 stores, if she falls in love with the product. When Brown Betty Dessert Boutique, a small Philadelphia bakery, pitched Thomas on a sweet-potato loaf cake, she did a joint venture with it to introduce the dessert under the Patti LaBelle name in 300 stores in the Northeast last September. Not long after, the bakery decided to shutter its retail shop to focus on wholesale opportunities, including the Walmart partnership.

Be prepared to crank up distribution (or to move on). Thomas recalls finding a small store with cream pies that she liked about two years ago – and cold-calling them. “It’s unconventional for a buyer to do that,” she says. “They were a little shocked and taken aback because when you say Walmart, they think big.” The result: Walmart launched a test in 250 stores of Cyrus O’Leary’s mini cream pies for $2.50 apiece. At the little pies sold, Thomas says, Walmart expanded their distribution to 500 stores and then to 1,000 – and she hopes to continue that growth. “I would say at least 25% of the time I am actively seeking newer suppliers I can actually grow with because they are likely to be the most innovative,” she says.

If you send Walmart buyers an email, make it good: On the Walmart.com website, you can click on a link that explains how to become a supplier. Walmart takes the resulting emails and routes them to the appropriate buyer. Every once in a while, a buyer takes the bait. Recently, Thomas says, she got an email from a would-be bakery supplier (she declines to give more details) making a claim that its product is the best in its category. “I called them, and they were shocked and tickled by the call, and we had some good conversations,” she says. “We ended up having a product meeting in the office here in Bentonville.” Now, she says, she’s working to see if she can pair that dessert-maker with an existing supplier to make the product at the same quality in mass capacity – at Walmart prices.

Pay attention to prices: Walmart is known for low prices, and companies that want to become suppliers need to be prepared to eliminate excess costs if they want to play. Setting the final price, Thomas says, is Walmart’s decision. For entrepreneurs, especially smaller ones, that means thinking hard about whether the price Walmart wants to offer consumers is sufficient. “We will talk about cost structure,” Thomas says. “We want to know how that will impact our customer.”

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