Category: Uncategorized

Rejected Programs: failure to DELIVER

By vendorco

Costco may reject your program if you are unable to deliver on what you promise. Often, this literally means delivering product to the warehouses, depots, or the member’s home – depending on your agreement. If you are incapable of fulfilling orders or delivering product on time, then we cannot stress enough how important it is to be upfront and honest. Better yet, find a fulfillment center or a solution so you CAN deliver.

How do you know whether or not you will need assistance delivering your product? Luckily, VendorCo can help you better understand what is likely to be required from you. There are several avenues to Costco placement, and we can provide you with your options and the structure of each. This information can be invaluable in getting your product in front of the right buyers for your company.

If you are interested in getting more information about the different avenues of Costco and the requirements for each, VendorCo offers all companies the opportunity to speak with one of our executive account managers through the purchase of a telephone consulting session. Better yet, partner with VendorCo to receive free consultation services as a standard piece to your service. Check out our services page to find the best option for your company.

Reasons for Rejection – Inadequate Value

By vendorco

One of Costco’s top priorities is to ensure that members receive an added value from all of the products on their sales floor. You should ask yourself: what value does your item offer Costco members that they are not already receiving from existing products, services, or programs? It is not always enough to say that your product is available at a better price!

Do you know how your product compares to Costco’s current offerings? Does your product offer enough of a value to Costco members? Send us some information about your product, and we will let you know if we believe your product is a viable fit for Costco. Contact VendorCo today to take advantage of over 20 years of Costco specific expertise.

Rejected Programs – Inadequate Savings

By vendorco

Costco is committed to providing the best possible price point to members. If your product does not provide enough savings to members, you are likely to be overlooked as a potential vendor.

How much savings is enough? How can you position your price point to provide the best chance for placement? This information can be fairly difficult to come by. Fortunately, VendorCo understands Costco’s structure, and we can help our clients craft a price point that will fit with Costco’s standards. If you are interested in partnering with VendorCo and taking advantage of the many, invaluable services that we offer, contact us today.

March Blogs – Rejected Programs

By vendorco

We often see manufacturers or service providers approach Costco believing that their product/service is, or should be a shoe-in for placement. This confidence may cause some companies to avoid using a manufacturer representative. After all, how hard can it be? If the product speaks for itself, why would an expert representative be necessary? But in fact, the Costco placement process can be extremely difficult to navigate, and there are a multitude of reasons why a manufacturer representative is an invaluable resource with Costco. Having a great product is the first step, but it certainly is not enough to guarantee a spot on Costco’s sales floors.

Many vendors find out the hard way that Costco is not like other retailers. Perhaps your product is selling exceptionally well through other retail avenues – but there is still a chance that your product may never see the inside of a Costco Warehouse. This can be incredibly shocking to established companies who do not have a comprehensive understanding of Costco’s buying procedures, which is why this month we will be introducing several reasons why your product may not be approved for Costco sale.

Keep checking back throughout the month of March to see the following blog posts:

Rejected Programs: inadequate SAVINGS

Rejected Programs: inadequate VALUE

Rejected Programs: failure to DELIVER

Rejected Programs: flawed PRESENTATION

Rejected Programs: lack of POTENTIAL

We hope that this month will provide potential vendors with a better understanding of Costco’s vendor expectations. Additionally, we hope to stress the importance of having an expert Costco rep by your side throughout the process, to help position your Costco presentation and increase your chances of success. For an expert Costco product placement and program development company, contact VendorCo today.

What Not to Do: Pull Out of an Approved Costco Program

By vendorco

VendorCo created an innovative program for Costco that involved the sale of artificial turf. Our Executive Account Managers contacted a reputable artificial turf company to fulfill the program, and it was quickly approved by Costco. Because there was no preceding product like it, the expected return rate was unknown, and the vendor grew fearful of Costco’s return guarantee. VendorCo recognized that a new product carried enormous potential, and strongly advocated for follow through with the program. However, against the direction of VendorCo, the company informed Costco that they would no longer be moving forward with the program. Still, the Costco buyers believed in the program that VendorCo created, and they were able to source out another company that was willing to adhere to Costco’s return policy. Within the first year, the program sold over 2 million dollars worth of product. Unfortunately for VendorCo’s client, they lost a potential relationship with Costco due to fear, and the revenue that could have been theirs ended up in the hands of a competitor.

What NOT to do? Never pull out of a Costco program, unless you are sure that your company cannot handle the account. However, if your company is unable to handle the account, you should never waste the time of Costco buyers by even presenting it until you are. At VendorCo, we screen our clients for Costco readiness, and we are happy to tell you our opinion on whether or not your company is ready for Costco. If you are an established company that is willing to serve Costco and its members, contact VendorCo today and we can help you position your product for maximized potential.

What NOT to do: Utilize Unapproved Manufacturing Facilities

By vendorco

While the US has shifted toward a service economy, most production jobs have moved overseas where the prices are far below what most domestic factories can deliver. Although this migration of production has many benefits to manufacturers and consumers, there are also great risks to human rights and safety. Stories of factory violations are all too well known, including violations of child labor laws, safety hazards to workers and consumers, chemical exposures, and the list goes on. Costco makes it a top priority to ensure that all factories are compliant with their standards, which can even exceed what the law requires. It is extremely important that your factory and products can pass high level audits, including state and national requirements related to all risk related aspects of production.

VendorCo can help you understand what is likely to be required from you in a Costco factory audit, which in turn can potentially avoid failed inspections, as well as damage to your reputation and relationships with the buyers.

If you are looking for expert Costco representation from a company that can help prepare you for the unexpected, contact VendorCo today.

What NOT to do: Exaggerate Your Ability to Deliver

By vendorco

It is extremely important to be completely honest with Costco regarding your ability to deliver what is promised to the Costco members. A large marketing firm with top names in the sports industry was hoping to move forward with Event Tickets that would be sold through several avenues within Costco, including Costco Travel, Costco in-store, and Costco.com. The company assured Costco that they had the appropriate clearance to move forward with multiple programs if it was approved, and Costco was thrilled to begin. However, the company was dishonest about their rights to sell the program, and they were unable to gain approval to sell the program to Costco. The dishonesty and irresponsible actions of this company resulted in a complete loss of any potential relationship with Costco. Not only was there a loss of the programs pitched to Costco, but the buyers refused to consider any additional items for the duration of their term as buyer.

What NOT to do with Costco? Never overstate or exaggerate your companies capabilities and rights. Costco only wishes to partner with established, honest vendors that will serve their members diligently. If you have an honest program offer and need help pitching your product to Costco, contact a VendorCo representative today.

What NOT to do: Sell Unfriendly Consumer Product(s)

By vendorco

A furniture company designed a collapsible, all-in-one style camping chair that was perceived to be a great product for Costco members; however, when removed from its packaging, the chair could not self-assemble quickly. It did not open and close well, and was therefore not usable right out of the package. Faulty product functionality like this can result in an onslaught of returns, possible recalls, a bustling customer service department, and of course, an extreme loss in revenue and reputation. All products must be consumer friendly and easy to install right out of the box with all necessary parts and instructions included before it can reach a retail audience.

What NOT to do with Costco? Never place an item on Costco’s sales floors that is flawed, in any way. VendorCo can help your company avoid costly miscalculations that can result in buyer disinterest, as well as damage to your reputation and relationships with the buyers.

Find out if your product qualifies as a Costco ready item, and contact VendorCo today for expert representation.

What NOT to do: Underestimate Costco’s Demographic

By vendorco

An energy drink company was able to secure regional sales at Costco’s warehouses. After performing a sales analysis of their current distribution, which was largely to C-Stores, the company found that diet energy drinks were 30% of their sales volume, while regular energy drinks were 70% of sales volume. The company chose to base their Costco test on this sales data, providing 70% regular and 30% diet energy drinks to Costco. However, the company failed to take into account Costco’s demographic data provided to them, and they experienced a lack of inventory for diet drinks, and a surplus of regular energy drinks. Due to this miscalculation, the test failed.

What NOT to do with Costco? Never underestimate Costco’s demographic. It is extremely important to be cognizant of who you will see your product on Costco’s sales floor. VendorCo can help your company avoid costly miscalculations like this that can result in a failed test, as well as damage to your reputation and relationships with the buyers. Find out if your product qualifies as a Costco ready item, and contact VendorCo today for expert representation.

February Blogs – What NOT to do

By vendorco

VendorCo’s Senior Account Managers have been working with Costco for over 20 years. This experience includes working inside of Costco’s buying, distribution and diverter program departments, as well as many years of outside Costco representation. Throughout the years, we have seen many vendors crash and burn with their Costco programs, for a variety of different reasons. It is always devastating to see a potential or current vendor lose or suffer losses to their Costco program, all due to mistakes that could be easily avoided with the assistance of a trained eye.

Product placement representatives like VendorCo are here to help manufacturers and service providers avoid costly, detrimental mistakes that can damage relationships and severely impact potential programs with retail. At VendorCo, we cater this service specifically to Costco Wholesale. Still, many manufacturers and service providers maintain the belief that they can navigate Costco’s complex processes alone. This month, we will provide true life examples of mistakes that Costco vendors and potential vendors have made in the past; mistakes that can be easily avoided when you partner with an expert manufacturer representative like VendorCo. Stay tuned, and contact us for expert representation based on years of Costco specific expertise.

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