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Costco Regional Sales Test

By vendorco

Costco purchases are often made by the Truck Load. Even regional items can be purchased as full trucks, depending on the product and the pallet loads. If a product is not successful, a full truck load purchase can result in a huge surplus of inventory which is costly to the vendor and to Costco. In order to protect the vendor and limit liability, Costco will often perform a sales test before launching a full roll out.

The structure of a regional test will be very similar to that of a national program, with the exception of the geographic breadth and units purchased. Product will be sent to a small percentage of stores covering a diverse geographic areas in order to determine if and where a product will see the most success. This allows the buyers to see if sales are strong in one area over another, so they can order accordingly during a full roll out.

Will a regional test be required for your product? How many units will be purchased and to how many warehouses will the product be distributed? These questions and more can be explained by a knowledgeable Costco expert. At VendorCo, we have over 10 years of Costco specific experience that lends us the ability to prepare our clients for the worst, so they can achieve the best results. To partner with VendorCo, contact us today at [email protected].

Costco Regional Sales: Risks

By vendorco

Some of the risks of regional sales are fairly obvious, even with just a basic knowledge of the buying structure. Clearly, regional sales will produce purchase orders in a smaller amount than national sales. Lower quantity production runs can be more costly than national programs, potentially lowering your margin. Additionally, you are limited to a smaller geographic area and a smaller number of warehouses. This challenges your marketing potential as well. Not all members will be aware of your product, and not all members will have the opportunity to purchase your product.

It is important to fully comprehend the regional buying and sales process in order to assess the risks and make a determination for your company. Other than experiencing the process first hand, a manufacturer representatives account can be the next best thing. Our partners learn from our experience and benefit as a result. To learn more, or to speak with a knowledgeable Costco representative, contact us today at [email protected].

Costco Regional Sales: Benefits

By vendorco

Regional sales can be ideal, depending on your company needs and goals. The benefits of regional sales include the possibility to focus on a small production run. Especially for companies that are new to club/big box sales, regional sales will allow you to create and test packaging and sales. Additionally, there are 9 regions and 9 regional buyers regional sales allows you 9 chances to hear a “yes”. With national sales, you only have one chance to impress, while regional sales provide 9 opportunities for a buyer to take a chance with your item.

To discuss more of the benefits of regional sales and to help determine if this is the right avenue for your company, choose VendorCo as your manufacturer representative. We will walk you through the process and provide you with the necessary information to make the best decisions for your company. Get started by contacted us today at [email protected].

Costco Regional Sales vs. National Sales

By vendorco

The regional sales buying group for Costco is separate from the national buying group. The national buyer makes decisions for all regionals, including Alaska, Hawaii, and Puerto Rico. This does not necessarily mean that a nationally purchased item will be placed in every Costco warehouse; however, it is a possibility. It is important to differentiate between the two so you understand how to fine tune your sales strategy. As noted in the previous entry, regional buys are either a Costco requirement or vendor choice. Regional buys may be the superior choice for smaller companies with saturated distribution in just a few regions. It is an effective way to test the success of your products and a good solution for mid-sized companies not wanting to take on too much risk.

Before moving forward with Costco, vendors should understand the distribution of each region, including the number of warehouses per region and how the regions are broken up geographically. This will help you to pinpoint which region(s) to target. If you would like more information about whether or not regional distribution is right for your company, you may want to consider partnering with a manufacturer representative.

Contact VendorCo to get started at [email protected].

Costco Regional Sales: Buying

By vendorco

It may seem obvious, most products that are shown to Costco buyers can be purchased nationally, regionally, or internationally. The advantages for Costco to buy regionally are numerous. Regional department purchasing allows for specific tastes to be targeted in particular regions. The process is less complicated with a more narrow demographic and the perfect climate for new product testing. Conversely, the vendor benefits from a more locally based product penetration, if that’s your prerogative.

The choice to offer regionally is either forced (many departments can ONLY be purchased regionally), or the manufacturer’s choice based on unique company goals. If you are unsure where your products should be launched, then you could benefit from a manufacturer representative’s perspective. With over 25 years of Costco experience, VendorCo’s sales representatives are experts in Costco’s procedures, and sensitive to the needs of companies small, medium, and large. We understand that business decisions will be made internally, and we are passionate about making sure our partners are fully informed of all options, benefits, risks, etc. Having an inside source can help your company make a clear decision of how to proceed, without relying on trial and error.

Contact us for more information, or to get started at [email protected].

Costco Regional Sales: Departments

By vendorco

Common knowledge to both consumers, manufacturers, factories, buyers, etc. is the concept of splitting up items by department. Products are categorized together based on function and familiarity and organized accordingly on both the physical sales floors and the digital web store. This is true for nearly all retail outlets. Costco’s regional offices are split up according to departments similarly to the national office.

For some items, you may find that Costco’s department breakdown differs from other retail avenues. Perhaps your item falls into the Lawn & Garden category within your retailer’s ecommerce department. You may be surprised to find that Costco’s department crossover could land you in Sporting Goods, or even Hardware. Additionally, some of the larger departments within Costco are split up between two buyers, so you may have to dig even deeper to identify your department.

Department identification is pretty black and white for some items – for instance, a couch will always be furniture. However, for some of the more niche, creative items that fill a unique consumer need, it could help to have an extra set of eyes review before identifying your department. This is important for correctly identifying the right buyer, so your first attempt at pitching your product is navigated correctly. VendorCo can help with this. Contact us today at [email protected]. We can help cut the guess work and get your item in front of the right person.

Costco Regional Sales

By vendorco

The buying structure within Costco can be a major cause for error with new business programs. Of the myriad of ways that Costco buys new items, which is the appropriate method for your company? Often, there are several options available, and it’s simply a matter of pinpointing the area that will provide the greatest value for your company. This month, we will be delving into Regional Buys, one of the ways that Costco makes a purchase based on geography and often based on company size.

To be discussed this month will be the following topics:

  • Departments
  • Buying
  • Regional vs. National Sales
  • Benefits
  • Risks
  • Regional Sales Test
  • More information

Visit our blog throughout this month for more information concerning the titles above. If you’re interested in pursuing a regional sales program and would like an expert Costco Representative to assist, contact us today at [email protected].

Costco Shipping More Information

By vendorco

Costco operates a streamlined supply chain that minimizes material handling and promotes efficient packaging, which gives them a competitive advantage and adds to the low cost pricing structure that members are so accustomed to. In a matter of hours, goods can be transferred from the depots to the sales floor, or direct-to-store from manufacturers.

Vendors are responsible for arranging transportation and all other logistics in shipping their product from origin to Costco. Understanding all aspects of the shipping process for in-store and .com is vital to the smooth operations of your program. If you need help with this complex choreography, work with an experienced representative at VendorCo. We can help you prepare and plan to ship to Costco, and cut out the guess work. Email us at [email protected].

Costco Shipping Third Party

By vendorco

As part of Costco.com’s shipping options, vendors may have the opportunity to utilize a third party shipping account. Regardless of the amount of shipping your company does, it likely does not amount to the volume Costco.com experiences on a daily basis. Higher volumes lead to better, more competitive shipping rates, which is great for the vendor, Costco, and the member.

There are specific steps that you must take in order to qualify for and/or obtain a 3rd party ship account, and this starts with the presentation process. Is it in your best interest to obtain a 3rd party shipping account? Are you having trouble deciding? What more do you need to know about this process before moving forward?

A knowledgeable rep can help answer all of these questions, and more. If you choose to partner with a representative company like VendorCo, you will be more equipped and prepared to make the best decisions for your Costco program. Contact us today to get started, at [email protected].

Costco Shipping E-commerce

By vendorco

E-commerce shipping at Costco may or may not deviate from processes that you currently have in place. It is just as important to understand the online shipping options as it is to understand in store. To further complicate the process, Costco is pushing for combined buys of many of these items. This means that the in-store and .com buyers work together to make their buying decisions. This process varies depending on the department and item, especially if it is a bid item.

You should know before presenting your item to Costco if it could potentially fall into this category. The pricing structure and process is very different from independently purchased items. Work with a representative to help you with the process. Email us at [email protected].

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