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View Full Version : Redline Sells out to Walmart



jackedup
04-26-2006, 01:59 PM
I spoke with a friend the other day and he said Redline had went mass market and sold out to Walmart. I went and checked myself and sure enough its only $2.24 per bottle.They also dropped the metal bottle which was one of the best attributes the product had. But to top it off they didn't lower the cost to distributors even though they are saveing a pretty penny by putting it in plastic . I would say the main reason Redline has the following that it does is because of all the distributors and retailers have stood behind the product and pushed it. Its going to be hard for any retailers to compete against Walmart, especially when retailers pay close to the same price Walmart sells it for. I am just curious what your opinion's are on this transition by VPX (Redline) It seems to me like they would lose business in the long run. I know most people dont like doing business with a company that has no loyalty to there distributors or retailers.

greg
04-26-2006, 04:03 PM
Sounds like you are not a fan of REDLINE or general business practices.
The reason Redline moved away from the Aluminum can is because cost was becoming prohibitive. China has become the Number 1 consumer of Aluminum in the last 2 years and they are paying a pretty price for it. They have been responsible for a Worldwide shortage and or price increase. How long does a company have to go before wising up and moving to a less expensive package?

Redline has gone into Wal-mart. However, Redline Gel Caps are in 1300 stores nationwide while the RTD is only in 300 stores. Furthermore, Wal-mart pays more for the drink than my tier 1 distributors due to contractual obligations by both Walmart and VPX. If Wal-mart chooses to make less money on the drink who am I to tell them how to do their business. Would you let me dictate how to run your profit strategy and marketing decisions?
If I remember correctly from my business 101 class I took years ago the object of any business that is in the consumer goods business is to get your product out there in as many places as possible.
By being in Wal-mart you have an opportunity to get your brand in front of customers that shop at the Number Retailer in the World. This can only fuel demand resulting in people paying more for it in a C-store due to convenience instead of waiting to go to Wal-Mart to pick it up.

Could you please explain to me why putting your product in Wal Mart is selling out? I thought that would be a sign of success, not a desperate move to appease the masses.

greg
04-26-2006, 04:14 PM
Oh Yeah, As far as our retailers and distributors and our loyalty to them:
I have contracts with my distributors that have exclusivity in certain market segments. i.e. gyms and health food stores, c-stores, mass accounts. By going into Wal-Mart I have not violated any such agreement because I am not taking business away from a distributor that serviced Wal-Mart. As a matter of fact Wal-Mart, because of it's nature, is different than any other retailer out there. I have given permission to several distributors to approach other mass accounts(Kroger, Albertsons, King Soopers, etc) in their respective territories in order to gain more market share with an understanding that once they get the account it will be protected.

Bill Brasky
04-26-2006, 05:23 PM
Gotta say, if this is true they are leaving that aluminum bottle, they have already lost their whole draw. That bottle coupled with its effects was the whole draw. Being another drink in an 8oz can means nothing these days. Effects mean nothing without packaging. Such a sad statement, but totally true.

My prediction, unfortunately, is this is the end of the line for Redline. This is a sad thing too because I really thought they would have a great niche thing going if they kept at it. Big fan of VPX and all of their products (except DIETEX...gross)....but if Redline, Pumped, Dietex, and the Black Pearl all come out of that bottle...it's done.

Don't believe me? Looks at snapple elements when they went to the metal bottle. The old packaging worked....this one does not.

DrPepperYummy
04-26-2006, 05:38 PM
Originally posted by Bill Brasky:
Don't believe me? Looks at snapple elements when they went to the metal bottle. The old packaging worked....this one does not. Well I guess I am confused myself because it sounds like you're saying it was negative for snapple to switch elements to the alluminum bottle... I've had far more success in 05/06 with the alluminum bottle than I ever did before in the glass. Especially in walmarts, they get the volume of customer who comes across my coolers and snags one out of there instead of redbull or other vendors who don't even have coolers present... so I must say walmart is helping my metal elements where other retailers are doing well but it hasn't pushed me through the roof with walmarts sheer volume of customers daily.

greg
04-26-2006, 05:56 PM
Bill,
I would hate that a drink that built its reputation on its potency would all of of a sudden fail due to it's packaging, even though the packaging looks exactly the same:Color, Shape, Screw Cap, graphics, everything. People who drink our product drink it because it works plain and simple.
I have guys tell me they would rather pay $3.29 for one REDLINE than $1.99 for 2-3 RB's because it works so well.
The Aluminum package was great and I will surely miss it but reality has to set in. When your packaging material cost exceed over 40% of your wholesale unit price what is a company to do? We surely didn't want to continue to eat those costs by keeping our wholesale cost at a constant price since inception. Something had to be done. We did the alternative and made plastic bottles that look exactly the same as the aluminum bottles.
Now we can save money on cost while keeping our distributors happy by not having to raise the price.

SumPoosieCat
04-26-2006, 06:55 PM
Greg... I could not agree more! I recently went from a glass bottle to a 16 ounce can for the very same reason. My cost were going up and up on the glass and when you go to pass it a long to a distributor... well let's just say they like it better when the price goes down, not up.

On a side note... I drink Redline often and it really does pack a punch!

greg
04-26-2006, 07:01 PM
Thanks TTB!

Bill Brasky
04-26-2006, 08:46 PM
I totally agree....you have a great product and its potenct is one of the best. No question. Please do not mistake me for discounting Redline as a brand...it is one I happen to like a lot, and support.

On the subject of Snapple Elements.....
Going to the metal bottle helped your sales??? No way. You may be one of the only ones. I have talked to DOZENS, possible over 100+ retailers (and a few buyers) who said that the switch literally SHUT DOWN their Elements sales. So much in fact, that I have heard NYC has in fact re-launched the glass bottle. Not true? Just saw it back in the streets down there, on a re-introduction promotional deal to retailers. Don't get me wrong, the product is very good...but that may have been a nail in the coffin for elements. Packaging is very important.

As far as the plastic bottle for Redline goes...I was not aware it was that similar. I was assuming it was going to a 8oz can. That would be fatal...as I said before. If the product is almost IDENTICAL....aside from the question of a shorter in-code product than the current aluminum screw-top, it might just be a great move....especially if that retail has a chance to DROP. (Tons of dist. would never carry at previous cost....they fear salesman/women not strong enough to get retailer to make that big of commitment....you know what I mean if you have seen this category progress!)

ALLPRO
04-26-2006, 11:13 PM
Being the biggest RedLine Distributor in the country, I have mixed feelings on the RedLine/Walmart Deal. If I had a piece of it, I would be stoked! Red Line selling to WalMart is not going to destroy RedLine's image. Just like CostCo did not ruin RockStar or Monster. It is just another avenue to get Redline in the hands of as many consumers as possible. Costco sells Rockstar and Monster at practically the same price that distributors pay. (Around $26.00 per case) That is much worst than Walmart selling RedLine @$2.49 per bottle. Bottom line: RedLine is a great product. It is going to sell anywhere energy drinks are sold. Good or bad, I will give updates on how Red Line in WalMart is effecting the product.

Super Jay
04-26-2006, 11:30 PM
Greg, are you paying your ditributors an invasion fee for cases that go to Walmart? If not then I think distributors have every right to be a little ticked. If you do pay them an invasion fee I hope it is a least $1 to $2 a case(12 PK). I think the customers that used to buy a few cans or more a day at convenience stores will eventually start buying more at Walmart and putting them in their fridge at home. Yes this is great for Redline but not so good for your distributors and I think they should be compensated. Just my opinion.

DudeMan
04-27-2006, 02:03 AM
A few cans or more a day? I don't think too many people can consume more than 1 Redline/day.

Seddrick
04-27-2006, 02:28 AM
I used to buy a 4 pack at Hi Health for 8.99. Now that I saw them at Wal-Mart I can get that along with my groceries. Saves me a trip.

greg
04-27-2006, 11:12 AM
Originally posted by Super Jay:
Greg, are you paying your ditributors an invasion fee for cases that go to Walmart? If not then I think distributors have every right to be a little ticked. If you do pay them an invasion fee I hope it is a least $1 to $2 a case(12 PK). I think the customers that used to buy a few cans or more a day at convenience stores will eventually start buying more at Walmart and putting them in their fridge at home. Yes this is great for Redline but not so good for your distributors and I think they should be compensated. Just my opinion. Why are you asking about invasion fees? I have not invaded anyones accounts by going into Wal-Mart.
Redline was started in the Sports Nutrition industry and our agreements are with htose distribuotrs to handle gyms and health food stores because they do not have the capitol to penetrate the C-Store or mass market accounts. Then I have guys like ALLPRO that have the means to service and fulfill C-store accounts.
I don't know if you have ever dealt with Wal-Mart on a national basis but they are not the same type of "selling-in" procedure as your local Stop & Shop.I can't just say "Hey Wal-mart can I sell this stuff in the Stores you have in my neighborhood".
It takes a concentrated and coordinated effort to insure that all Wal-Mart distribution centers have available product.
Redline is not at the point where we have saturated the market and have distributors in every possible Wal-Mart District. When we do get to that point then we won't have to worry about freezing some distributor out, we'll just let them sell and service the accounts.

JordanE
04-27-2006, 04:03 PM
Can we find redline at all (or almost all) wal-marts now? or just a few? I've always wanted to try redline but I can't seem to find it in Vegas. And I really don't want to order online. This is good news for me.

greg
04-27-2006, 04:55 PM
REDLINE gel-caps are in 1300 stores while the RTD is in only 300. Which 300 I can not tell you. That is a decision made by Wal-mart.
I would expect it to be in more affluent neighborhood stores.

Buying online is not as risky as it used to be. Try www.Bodybuilding.com (http://www.Bodybuilding.com) or www.mysupplementstore.com. (http://www.mysupplementstore.com.) Both of these sites are very reputable plus they have rediculously low pricing.

JordanE
04-27-2006, 05:41 PM
Before I put out the $$ on buying a case I would like to try it first. I don't really wanna pay $6 to get one bottle shipped to me either. Call me cheap but I don't really wanna spend $10 for one bottle of redline I also don't wanna spend $58.94 on a case when I haven't tried the product.

Thanks for the links though, I usually buy one case of energy drinks (usually sobe NoFear) per month. So if I can buy one bottle at a normal price than i will probably buy a few cases from one of those to sites.

Greg is there any place where I could get a sample of redline RTD?

greg
04-27-2006, 05:54 PM
Where do you live?
BTW if you buy one case of No Fear per month you will only need 1 case of Redline for 2 months!

Red Sox fan
04-27-2006, 06:27 PM
Greg,

Do you own Red Line or work for them?

greg
04-27-2006, 06:54 PM
REDLINE is a subsidiary of Vital Pharmaceuticals aka VPX Sports. It is an independently owned company for which I am employed.

JordanE
04-27-2006, 07:02 PM
Las Vegas, NV

greg
04-28-2006, 11:20 AM
Jordan,
BOSS ( Bob O'leary Sports Science) is a huge Sports Suplement Distributor out of Las Vegas. You should be able to find it in any GNC, 24 hr fitness, Bally's and independent sports nutrition retailers. BOSS does a great job of covering their market.