PDA

View Full Version : STUPID SLOTTING FEES!!!!!!!!!



POP
07-08-2005, 09:39 PM
Sorry guys, I just need to vent a bit.

I just learned today that if I wanted to get my beverage in a chain store I would be facing HUGE slotting fees.

This sucks so bad. How is the "little guy" ever supposed to compete in this industry? Or is this the tactic to keep the smaller beverage firms at bay from coming out with a better quality beverage while still having a competitive price.

The one ray of light that keeps my hopes up is that supposedly convenient stores and gas station stores don't have slotting fees, can any distributor here confirm this please?

This factor will either make me or break me.

Anyway folks, any insight to my dilemma is appreciated.

Thanks for listening and I apologize for the long post.

TaB
07-08-2005, 10:12 PM
The fees are horrible.

However, I have a possible buisness plan for you.

POP
07-08-2005, 10:41 PM
Tab, are you an angel? :eek:
Thanks for taking an interest in my post.

TaB
07-08-2005, 10:45 PM
Listen, there are some steps you will need to take:

First of all, create a formulation. Then, ship it out to the members of the board, along with a marketable identity.

Then, solicit those who you selected to try your beverage to invest in your company. Be it $20 or $2000, it will all come in handy.

Also, get a website real quick, even if you just use it to pop up some goole ads before you put real content up. (Those ads can be, as long as people visit from the search engines, a steady flow of income.)

What kind of soda are you wanting to market/produce.

POP
07-08-2005, 10:56 PM
Originally posted by TaB:
Listen, there are some steps you will need to take:

First of all, create a formulation. Then, ship it out to the members of the board, along with a marketable identity.

Then, solicit those who you selected to try your beverage to invest in your company. Be it $20 or $2000, it will all come in handy.

Also, get a website real quick, even if you just use it to pop up some goole ads before you put real content up. (Those ads can be, as long as people visit from the search engines, a steady flow of income.)

What kind of soda are you wanting to market/produce. Tab, once again, I appreciate your reply.

At the present moment, I'm still debating if I would formulate a lemon lime flavor or coke/pepsi flavor.

I'll be more than happy to send out samples to all those who are interested, however, I didn't understand your 2nd and 3rd paragraphs.

But do you know if convenient stores and gas station marts have slotting fees?

Mr Zabe
07-08-2005, 11:10 PM
My two cent.

I would try to develop a niche market with a target audience. If do-able you could have a sample table at a bar,concert,church any public place.

The connivance store idea is very cool. In the short run you need to generate lots of "noise".
It's a bottom deal for small new players. Try not to over invest in capital things like expensive machinery. Marketing yourself is just as important as the product.

Look at Ben and Jerry's. The were bottom dairy/farmer men who love to indulge in good ice cream. I will venture to say,in light of the high quality of their ice cream, the marketing of their trade mark"Ben and Jerry" had a major part in their success.

Keep at, think small, do not accept the word No.

Good Luck

[ 07-08-2005, 10:14 PM: Message edited by: Mr Zabe ]

POP
07-08-2005, 11:21 PM
Mr. Zabe, to me, the marketing aspect of business is the fun part of running a business. I do have a target market that I'm aiming at.
I'm blessed to live in Socal(nyc transplant), and there are many outdoor events taking place to take advantage of the guerilla marketing tactics that I have conceived. In short, Marketing is the easy part for myself anyways.

It's the grit of the business that kills me. Finding out the exhorbhant costs of shelf space in major grocery chains took some of the air out of my balloon.

But I have to repeat my question again, do convenient stores and gas station marts have slotting fees?

Mr Zabe
07-08-2005, 11:25 PM
I will venture to guess that the national chains like 7 11,White Hen Pantry,Sonic,Citco and so on,
have agreements with their regional soda pop companies. Perhaps some Ma & Pa convenient stores or maybe some health food stores might work for you.

Your right, slotting fees are mind blowing.
Good Luck
Zabe

TaB
07-08-2005, 11:27 PM
Yes, but much less than those at major stores. You'd need to communicate directly with each store at first, to try to get a feel for the market around.

Secondly, I would suggest going for a totally new beverage concept, instead of a regular cola or lemon-lime.

For example, a tangerine/lime soda with real fruit juice and just a bit of added cane sugar, carbonated correctly, wouldd be a very tasty, fresh drink that would appeal to a wide range of people and be unique in a stale marketplace.

Mr Zabe
07-08-2005, 11:30 PM
Tab, Excellent points. Unique products are risky but the rewards are greater. smile.gif

Hacksaw
07-09-2005, 07:42 AM
How about a Raspberry Cola?

Yes, you WILL need something unique to catch on. I can go to Bev & More & get like 8 different colas, over a dozen Root Beers, and about 6 lemon-limes. I notice the offering there keep changing.

Hank's, Thomas Kemper, Boylan's, Jones, & Stewart's were not around here a decade ago, so the field is getting bigger all the ime.

boodoo
07-09-2005, 10:50 AM
Dizz,

Here in north Texas the independent convenience channel does not require slotting. They do however want "deals" that can be free cases. For a new item launch I would suggest that you inflate your frontline so that you can accomodate a "buy x get y free" type program.

Find a solid local distributor and work with them to build your brand. And remember your distributor is most likely a little guy like you!

jblaviback
07-09-2005, 01:12 PM
As Zabe would say about some I am a laymen who enjoys drinking soda. smile.gif So could someone explain to me what slotting fees are?

By the way Dizz, I must say that the people who are encouraging you to make a unique flavored beverage are absolutely right. I know that if I go into a store and see a werid flavored soda it jumps out at me a lot more than justa another cola or lemon lime.

TaB
07-09-2005, 01:21 PM
You pay to have your product placed on a shelf, in a certain "slot".

PSOmasterX77
07-09-2005, 01:42 PM
Make something that tastes like Pepsi Blue. I'd be your first customer ahaha :) But yeah, it's fun walking into a store and seeing wierd funky sodas that look tasty, I buy them right up.

POP
07-10-2005, 02:00 AM
Thanks for answering my question boodoo.
Boodoo, can you elaborate by what you mean by inflating the frontline?

What do you guys think of milk and pepsi? haha.
So far people have recommended tangerine/lime, rasberry cola... Anything else you guys would want to see on the shelves?

HomeGrown
07-10-2005, 02:38 AM
I've always liked Apple flavored sodas but there pritty hard to find. That might be a good product for you to make anther one would be to make a copy of cherry lime slice that stuff is extremly good. Anther one would be if you could make a near perfect (or perfect) copy of SURGE (a very awsome drink) SURGE has a huge following (www.savesurge.org) and i belive you could get a TON!! of bissness if you sold it on the internet.

[ 07-10-2005, 01:40 AM: Message edited by: HomeGrown ]

Beverage Slinger
07-10-2005, 04:45 AM
Welcome to So.Cal,it's a agressive market,but it can be done in the mom and pop's independant's and non chain gas and convienence store's,stay in a nitche, no cola,lemon lime,rootbeer, ect.The majors have these down and will take you out with their power,it must be something to small for them to carry,but big enough to move boxe's in a small store for you,you can use dealer loader's like polo shirt's with your logo with an entry order,or a buy X get Y free,but ultimatly it will boil down to YOU,you must make a commitment of you to them,you must build a relationship,of Trust,Number 1,SERVICE,Number 2,SERVICE,Number 3,SERVICE. PS,don't take no $h%t from no beverage vendor.Good hunting my friend.

POP
07-10-2005, 05:19 PM
Beverage Slinger, PM sent.
Thanks,
D

DJ HawaiianShirt
07-11-2005, 09:21 AM
I like HomeGrown's idea. Copy Surge as best you can(moreso than Vault), and maybe even make a reminiscent label(as far as you can go without breaking copyrights). An identical clone of Surge would be huge.

But Vault is starting to be established already, so it's risky.

boodoo
07-11-2005, 11:36 AM
Dizz,

Lets say that your product is packed 24 to a case and you want the retailer to pay $1 per bottle or $24 per case.

You would mark up your cost to retail to $32 per case and offer a "buy 3 cases and get 1 additional case free". The math goes like this....$32 x 3cases = $96 / 4cases = $24 per case.

You get the price you wanted, the retailer gets something "free" and you get a multiple case purchase.

Beverage Slinger
07-11-2005, 05:35 PM
Got your message Dizz.

TaB
07-11-2005, 05:41 PM
Hey, Dizz, I made some Tangerine/Lime formulations.

I used carbonated sparkling water (30%), Tangerine Juice (40%), Orange Juice (10%), Lime Juice (20%).

The juice was fresh-squeezed, and I used San Pelligrino sparkling water that had been open for half-a-day. (This removes some of the strong carbonation taste.)

[ 07-11-2005, 04:42 PM: Message edited by: TaB ]

POP
07-11-2005, 06:23 PM
Beverage Slinger, please write me as soon as you have a free moment.
Thanks,
D

Tab, that concoction sounds very refreshing, very "Izze" like.
Just to let you guys know what's up, I think I have a winning flavor with this lemon-lime formula, I'm sure you guys will probably flame me for being so "original" but hopefully you guys will give my beverage a chance. As unoriginal as the flavor will be, my thought process is to produce a better quality beverage.


Regarding slotting fees, I sp oke to a very big Socal distributor in San Bernadino this morning. They informed me that to be put in convenient stores and gas stations, the stores have to request my product first. AFter that, there will be some red tape but seems like there is hope for my product.

[ 07-11-2005, 05:24 PM: Message edited by: Dizz ]

TaB
07-11-2005, 06:25 PM
If you do it well enough, I don't think any of us will care. =)

(Hopefully, after entering one product, you can expand your line. We need more innovators.)

POP
07-11-2005, 06:52 PM
Prior to signing up to Bevnet, I was going to use my brand name, and just pretty much going to knock off any type of energy drink(whoop@$$) and just make a quick buck, but during my research and signing up to bevnet, I developed a passion for beverages, I'm so passionate to the point that I resigned from my job two fridays ago.

From reading various posts/arguments, the people who also have passion for this industry and it's products rubbed off on me.

My first and foremost goal is to provide the highest quality soft drink without the "Gourmet" price attached to it.

As said earlier, I wanted to make a quick buck in the "Energy drink" category, but from my experiences, there's no way in hell that I can ever wash down a meal with say a red bull or any of those other energy drinks. This reasoning led me towards the soda side of the industry.

As booming as the energy drink market is, I believe that 99% of the population still love sodas, the other one percent are either water lovers or classified as "Others".

But I know that I have a challenge ahead of me, if my beverage can win your hearts and palates over, I think my passion will pay off.

Mr Zabe
07-11-2005, 07:04 PM
Dizz,
Your doing good. It take takes a lot of integrity and a strong stomach to take another direction in life. Not everyone is as strong as you are.
It's cool that you were able to get the support you needed from this fine board of experts. smile.gif

Good Luck and Mega Burps.

Zabe

Beverage Slinger
07-11-2005, 07:41 PM
Thank you Dizz,I was waiting for a little more info.

POP
07-11-2005, 07:54 PM
Mr. Zabe, thank you for the encouraging words.

From what I have read, I know you guys are some hard @$$ critics when it comes to sodas and I anxiously want to shut all you guys up with a crisp refreshing soft drink.

So far I have ™'d my brand name, set up a dba/fbn, found a flavor house that can, develop, manufacture and can a finished product to me.

Speaking of cans, I have been talking to a Rexam rep. Since it's not an "energy" drink per se, what size can should I go with? 10oz or 12oz, these will be the "slim" style cans.

I know soda's that come packaged in glass are tastier but from a marketing stand point, I prefer aluminum. I also inquired about aluminum bottles however, the price for a bottle can is near $.35 -.40 cents per unit.

POP
07-11-2005, 07:56 PM
Beverage Slinger, to me it appears that you are on top of your game and know the in's and out's of this industry. I'll be more than happy to divulge any more info that you would like.

Once again, I want to thank you all for taking an interest in my thread.

1000 thank you's to everyone.

Beverage Slinger
07-11-2005, 08:24 PM
Thanks Dizz, but I'm no expert,just learned a few things along the way,had some great mentors.

DJ HawaiianShirt
07-12-2005, 09:13 AM
Dizz, it's probably a good idea to not get into the energy drink biz. Red Bull and a handful of others have the whole industry in their grip. Unless you've got millions to spend on advertising(which is more important than taste for energy drinks), then I don't think it's worth it.

But, once you get your product manufactured, I would gladly pay for your trouble and the shipping if you'd send a bottle or can out here to me, as I'm sure many others on this board would do also.


SEV

TaB
07-12-2005, 12:34 PM
I'd def. go for the 12 oz. can, as each oz. of soda is cheaper to now produce, and you present a larger product with a minimal cost increase.

POP
07-12-2005, 01:26 PM
SEV, I hear you about the energy drink biz.
I'm staying away not only because of the reasons you mentioned, but it seems that "everyone" drinks soda where as the "hardcore" energy drinkers are already loyal to their brand.*cough red bull.

As for the free cans, it's as good as yours.

Tab, we're pretty much on the same page, I'm talking to Rexam about the 12oz. Sleek can.

TaB
07-12-2005, 01:55 PM
Cool times 3.

Listen, if you want investment in your company, I'd be hapyy to throw in some money.

POP
07-12-2005, 02:06 PM
Tab, I appreciate your generosity but I am working on my business plan to raise funds for manufacturing and marketing of my beverage.

I've been on the hunt for a successful beverage firms business plan so I can compare and contrast but I haven't found anything on the internet just yet.

I'm very curious to see some of these start ups plan to see how they got funded.

POP
07-13-2005, 01:47 PM
Bump.

Does anyone have a copy of The Republic of Tea?

Beverage Slinger
07-13-2005, 11:31 PM
wrote everything on a napkin .