01 Oct Four Reasons Partnering with a Food Broker is Good for Business
Whether you’re just beginning to look into introducing a new food or beverage product to the grocery market or have been pitching your own wares to retailers for years, partnering with a food broker could have a dramatic, positive impact on your success.
“What exactly is a food broker?” you ask. Simply put, food brokers are independent sales and marketing agencies that work for food and beverage producers, helping them get their products into retail stores, independent wholesalers, chain grocers, and more.
Unlike distributors, who buy products, mark them up, and then resell them, food brokers usually receive a percentage of product sales as a commission. As such, their earnings depend on their efforts to get your products onto market shelves as well as to attract the attention of shoppers through effective in-store merchandising.
It’s a classic win-win arrangement with many mutual benefits. Consider these four that we think are the biggest reasons partnering with a food broker will be good for any food or beverage manufacturers’ business.
- Food Brokers Save Manufacturers Money
Sure, you could hire full-time sales and merchandising staff to help you take a new product to market or expand into new territories. However, doing so requires you to invest cashflow into salaries and benefits for those employees. If you choose to work with a food broker instead, you have all the benefits of keeping sales professionals and merchandisers on staff without the cost.
- Food Brokers Save Manufacturers Time
The food and beverage market is enormous—and crowded. Experts expect it to reach a value of nearly $9.4 trillion by 2022. With an ever-increasing number of products available to retailers, manufacturers can spend months or even years trying to secure valuable space on grocery store shelves.
Fortunately, when you work with a food broker, you eliminate the need to develop those relationships on your own. At FreshSource, for example, we’ve already cultivated relationships with major retailers throughout Northern California and the Pacific Northwest. We’d be thrilled to offer you a free product consultation to assess your prospects.
- Food Brokers are Market Experts
Over years of working in various markets with numerous vendors, food brokers develop expertise in recognizing which products are likely to sell best in any given location. Instead of seeking out shelf space in dozens of retailers and hoping for the best, manufacturers who partner with food brokers can target their products to specific accounts that are likely to generate the best sales.
Additionally, when you’re ready to expand sale of your product into new territories, or even into the international market, a food broker can supply you with the data and resources you need to avoid issues with compliance and navigate other complexities.
- Food Brokers are Planning Experts
Getting your products onto market shelves does not guarantee success, as many now defunct small food and beverage manufacturers can attest. If you want your business to thrive long-term, you need to envision the future and ensure your sales are growing steadily enough to get you there.
Food brokers are experts at crunching the numbers necessary for these types of calculations. How much are you earning from each of your retail accounts? Your food broker can tell you. How many more accounts do you need to secure to meet your goals? Again, your food broker will know the answer to this and many other vital questions. All you have to do is ask.