Out in left field: any way to get supplier's perspective on a product?

[SumpinSpecial]

I carry a particular brand of dog toy in my shop that I LOVE. They are hard-plastic puzzles that you play with your dog. The only problem with them is that they're expensive. Over this past year I've taken them to several in-person vending events and talked them up and got potential customers really interested in them. Then they ask about the price. They get a guarded, polite set expression on their faces and politely excuse themselves. These toys are THAT expensive.

I've noticed that the supplier I was getting them from is no longer carrying them. Because of the exhorbitant price, I'm ambivalent about whether I should find a new supplier that carries them or just drop them from my store. I emailed my supplier and asked for their thoughts on the matter; if they had trouble moving them because of the cost. They politely refused to answer that but just confirmed that they're not carrying them anymore.

In researching my products and supplier chains, I've noticed that there are new, different dog puzzles coming on the market that cost a LOT less. (I'm working on building a relationship with a supplier of these new toys also.) I'm wondering if this competition will force the first manufacturer to drop their prices to stay competitive. I would love to be able to ask this on some sort of supplier/distributor of pet products internet forum but I don't know of one that exists. LOL! Is this something that I can only go by my intuition and powers of deduction?

[Fulcrum]

Can you cut out a middle man somewhere and try to buy from someone closer to the factory? I've found that there can be 3 or more levels of independent distributors that all add a 40-100% markup each.

[SumpinSpecial]

Nope that's the first thing I tried. This manufacturer only works with distributors.

[turboguy]

If it is actually made in China you might be able to go on Alibaba and find a direct source or find something similar enough to satisfy the need and get a great price as well.

[SumpinSpecial]

It's a line of products made by a Swedish company. They're fantastic, except for the pricing. I have reached out to them asking if I could buy wholesale directly from them but they directed me to their USA distributors. Which at the moment seems to be in flux. I guess I'll just continue to keep an eye on them to see how things shake out.

[Kg3000]

I am on both sides of this, I supply small and large companies with product, and at my other business I have to buy products for use, usually when it comes down to distributors volume is the key. I would suggest you approach the manufacture and ask them how much you would need to buy to get a distributor price, I would see no reason for them to reject a deal in which you would purchase as much as as distributor. Only issue that can come up is that you need to make sure you can move a large amount of product, or become an actual distributor.

Just an example i need some drug testing supplies and I was paying 15 dollars per unit. I approached the manufacture and asked how much do i need to buy to get the distributor price. They told me 100 units at 7.10/unit which came out to 710 dollars. For me this was a good deal, I am getting a little more then half off and the units do not expire for 18 months, i use about 10 units a month so it a savings of $790.00 just to buy a years supply all at once.

I would approach them see what they come back with and then do a quick cost analysis to see if it makes sense.

Good Luck.

-Kumar

[SumpinSpecial]

Thank you Kumar, that's very logical. Unfortunately I'm too small to be able to do high volume sales at this point. Maybe in a few years. :-)

I have found an alternate product line of equally innovative dog and cat puzzle toys that cost a lot less, so I think I'm going to drop the expensive ones and carry the new line instead. The new line is manufactured in China, so I'm going to keep a VERY close eye on quality, but I feel that I need to stay nimble while I get my sales volume up.

[James Minton]

I have performed literally hundreds of market research projects, and rarely is price the sole factor at the point-of-sale. The mix of quality/service/availability almost always supersedes price; that said, is the dog toy made of gold? The only thing I can think of which would command the high price you describe is if the supplier/manufacturer target market is dogs that are in dog show competitions... a very niche market. Developing a relationship and asking questions is the best way to get answers... meanwhile, vote with your wallet--no company likes customer attrition.

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[SumpinSpecial]

The USA distributors working with this particular manufacturer are changing, and have been in flux for half of this past year, which gives me the sense that I'm not the only one who thinks they're overpriced. They seem to be sort of a hot potato being tossed around. Part of the pricing could be that they're manufactured in Sweden, perhaps part of it is the currency rates, perhaps high duties importing from Sweden to the USA. I don't have visibility into much of that.

But yes, while the quality is high, and the service I offer my customers is high, I'm still getting my name out there (which is admittedly my job to do). The price point is just too high for me to be able to sell until I'm better known.

I have been developing good relationships with the various suppliers I'm working with, though. One of the things that most blew me away in starting this new company with no prior experience starting companies, was how kind the suppliers have been.

[Fulcrum]

Have you looked into developing your own line of puzzle toys and having them made a little closer to home? My understanding is that your incoming president is looking to bring jobs back and there might be some incentive offered to do so.

When it comes to the actual product, I believe that it does need to be made out of food grade material suitable for human consumption (at least in Canada though I think the US laws are fairly similar). This will drive the pricing up due to material costs and required manufacturing costs. Be careful on importing from China or other low cost producers as they will often substitute prime material for whatever is available regardless of quality or suitability. One of your main jobs will be to educate your customer as to why your higher priced toys are better suited for their pets rather than the cheaper ones.




I have performed literally hundreds of market research projects, and rarely is price the sole factor at the point-of-sale. The mix of quality/service/availability almost always supersedes price

I'd like to read a few of these studies because, unless I'm dealing with an "educated and discerning" customer, price is the sole point that the majority of people base their decision on. This extends into the B2B market as well and is almost always worse. I've had customers beat me up on price because I was "too expensive" even though the problem was in their lack of maintenance, inattention during machine setups, and employees that turn the feeds down so they don't have to work as hard.


meanwhile, vote with your wallet--no company likes customer attrition.

No one may like customer attrition, but it's a part of business. If you come to me and we do some business together - great. When you start beating me up on price for the sake of beating me up on price (no volume increase or COD payments), or tell me to go against my quality standards, I will give you a final statement, demand final payment, and won't be back until you are willing to let me do my work on my terms (price is fair and I jump for my good customers).

[SumpinSpecial]

Have you looked into developing your own line of puzzle toys and having them made a little closer to home?

I haven't looked into this much, no. So far I'm enjoying doing the retail store gig, selling other people's products. Actually the hands-down funnest part (after the bookkeeping, weird person that I am) is sourcing new products and getting them listed in my shop. I get SO excited about finding fun new things to sell (that fit into my vision).

Since I wrote the OP, I did find and nail down a new business relationship with a supplier of similar but less expensive dog and cat puzzle toys. These new toys are designed by a German company and manufactured in China (with German oversight on the quality) to keep the prices reasonable. So I'm very excited about that and can drop the other expensive stuff.


I'd like to read a few of these studies because, unless I'm dealing with an "educated and discerning" customer, price is the sole point that the majority of people base their decision on.


You're right there, especially in retail (where I am) and double especially with pet products. I'm targeting the market of upscale pet owners (people who follow sites like Dog Food Advisor, put coats on their dogs and maybe even walk their cats on leashes), but occasionally I do get the mid-lower scale demographics who:

1) refuse to be educated
2) refuse to pay one cent more for quality or features
3) "I ain't gonna pay that for no dawg, har har!"

Which isn't to say that I don't try. You do have to sell your products and the only way to do that is to convince the shopper that they're getting value for their money. But a price that's perceived as too high is never, ever overcome.

[Fulcrum]

But a price that's perceived as too high is never, ever overcome.

It can be overcome, but it takes a long time and several severe screw ups by the cheapest provider.



1) refuse to be educated
2) refuse to pay one cent more for quality or features
3) "I ain't gonna pay that for no dawg, har har!"

I'm firmly in camp 3 on this. I can appreciate pets, but when it comes down to spending big bucks on one I can't justify it. I'd rather see that money go to a charity similar to Fresh Start Maternity (http://fsms.ca/) (I may be a crusty and jaded fellow, but these charities hit close to home for me).


So far I'm enjoying doing the retail store gig, selling other people's products. Actually the hands-down funnest part (after the bookkeeping, weird person that I am) is sourcing new products and getting them listed in my shop. I get SO excited about finding fun new things to sell (that fit into my vision).

I'm the exact opposite. I get excited finding new products to make (who needs sales as long as I get to make something :D).