Question from MakoStu

MakoStu writes, “ I hear from many small vendors telling me that if you do business with one big box home center, (say H/D) then you cannot do business with the other say (Lowe’s) – while not said directly, the big boxes seem to make this point in subtle ways. The problem is principally for the smaller vendors not the real big guys like B&D or Stanley. What strategies have the small vendors used to get over the problem?”

Thanks for the question Stu and if any of our readers would like submit responses, please feel free to comment. If a client were to present this question to me, I would suggest there are a number of options open for us to consider.

1. Don’t fight, accept what they are saying and look for business in other areas. Filling the requirements of a big box for a small vendor can be a taxing undertaking. Do it well and prove the value of your product and your brand. Maybe it will be possible later on to expand to the other retailer after you have become established and valued by the first retailer.

2. Ignore what they are saying and run the risk of loosing some or all of that business. This is risky, but if you have the only widget available to the market and you have the capacity to meet the needs of both retailers at the same time, it may be something you feel is worth the risk.

3. Consider building different models of the product for each outlet. This is an age old approach to the problem and has been done for years in different channels of distribution so that competing channels would not have identical products for cross comparison.

4. Consider a branded product for one and a private label for another. This again is another step to avoid direct comparison.

5. Consider a relationship with another vendor where they take a modified version of your product under their label to the other outlet.