This is part 3 in my blog post series “From 0 to 10,000 customers”, documenting everything I did to grow my first eCommerce business. If you’re new here, take a look at the whole series or start with Part 1: How I started my eCommerce business.


I didn’t set out to build a wholesale business.

So when it came time to create this series, I really debated including a post about wholesaling.

My experience is limited at best, but I do know that building a company that people keep repurchasing from will organically lead to wholesale partnerships.

But first, you need to build a company customers love.

For me, deciding between the wholesale and consumer route at the start of Trefiel’s journey was quite a simple decision.

Building a consumer-focused business made it easier to acquire customers at scale. It also allowed me to have the most impact in my customer’s lives, which became my favourite part of Trefiel.

Should you focus on wholesale or direct-to-consumer?

Before making this type of decision, I think it’s really important to take a look at your skills and your strengths as a person.

If you don’t have any digital marketing experience, getting those first few sales and much-needed foothold as a fledgling business might be easier for you on the wholesale path.

Even if you have digital marketing experience, the wholesale path needn’t be something you put to the side. Facebook Ads work incredibly well for growing wholesale businesses if you have the right targeting and the right offer…

I think both channels are worthy of being pursued, but for me personally, the lure of direct-to-consumer is stronger than wholesale. Here’s why –

  1. There are better margins;
  2. You can control the customer experience;
  3. You can speak directly with the people who are using your products (this is more difficult with wholesale).

So now the obvious question is, how do you build a wholesale business (or a wholesale channel into your existing eCommerce business)?

How to create a strategy to build a wholesale business

When looking at the approach I’d take to deploy a wholesale outreach strategy, I realised that it wasn’t very different from the influencer outreach strategy I mentioned in my last post.

  1. Create an avatar of your ideal customer and the stores they shop at (hopefully you already have this completed).
  2. Create an avatar of your ideal stockists.
  3. Use google and social media to find potential stockists to outreach.
  4. Profile them and ensure they fit into your target demographic.
  5. Outreach them.
  6. Follow them up until you close a deal or they tell you no.

The follow up is the most important phase of when you want to build a wholesale business.

There was a period of time when I was living in Melbourne that I went to each and every pharmacy and beauty store to convince them Trefiel was a great product to stock on their shelves.

I remember spending weeks on one particular Priceline store, returning, again and again, to see if they’d made a decision.

They eventually decided not to stock us.

I can’t deny they made the right decision.

  • Our packaging sucked;
  • We were an unknown company; and
  • We only had one product, a single face mask.

It didn’t make business sense for them, but I was frustrated their answer was no. But if I had not persisted with following them up, I may have always wondered ‘what if’ and I certainly wouldn’t have gotten the feedback above from them.

I knew we had a great product, but we needed to more credibility, more products and more cash.

When Priceline told us no, I took a determined step back from wholesale. If big companies weren’t going to let my business in, I’d build a business and a product line that they’d chase after. So that’s what I did.

Eventually, Trefiel’s face masks were in Priceline and sold well because of the brand we’d built.

While wholesaling wasn’t my main focus, I watched one of my close business friends see huge success while focusing on that channel for their business. That friend is Natalie Thorogood from Soak Society, who started her company just a few years before mine.

Learn how to build a wholesale business with Natalie Thorogood from Soak Society

When I asked Natalie to be a part of this series, we sat down to brainstorm how she could help you get started with building your wholesale business. From that meeting, she came up with 4 tips that will help get you on your way to wholesale success.

Tip 1 – Provide excellent customer service to your wholesalers

Tip 2 – Don’t assume that trade fairs are the only path

Tip 3 – Use cold-emailing to acquire new customers

Tip 4 – Make it easy for potential stockists to add your product to their store

To save you time in creating the spreadsheets Natalie mentioned and writing your own outreach templates, I’ve put together a folder that has everything you need to start with wholesale.

Inside you’ll find:

  1. My exact outreach email template that I used to convert potential stockists into paying customers;
  2. My follow up template for potential stockists who hadn’t replied;
  3. A spreadsheet for tracking wholesale outreach and existing stockists which Natalie Thorogood from Soak Society uses herself;
  4. An example of a wholesale overview document from my own eCommerce business, showing the information you need to include when outreaching potential stockists; and
  5. A stockist pack folder which has instructions for what you need to include in this folder. This folder should be shared to all of your stockists as they join your wholesale team and updated with new imagery and information as you have it.

If you want to build a wholesale business, this folder is the best place to start. Just click here and I’ll have it emailed to you.

Regardless of whether wholesale is another channel for your existing business or you want to have one channel as the main focus of your new business, I think it’s important to mention the same lesson I mentioned in my influencer marketing post.

It’s important to focus on channels that are working but equally as important to diversify your income streams.

Whatever route you choose, keep that in mind.

What retail buyers are looking for in a physical product

We stumbled into wholesale out of sheer luck. From our buyer’s perspective, it was a tactical win.

The first retailer found Trefiel because we were deploying a focused Instagram hashtag strategy as part of our platform strategy. In fact, she outreached us directly on Instagram within a matter of months of us launching. From there we sent samples and waited excitedly to hear back from her.

People make up excuses about Instagram not being suitable to grow businesses any more and I laugh.

Instagram has done so much for me, my previous and existing businesses that it’s one of my favourite platforms. It’s harder to gain traction with consumers on it now but damn, is it effective in other areas.

Like finding retailers.

What a buyer wants to see in a product they’d like to wholesale

Let’s look at this from two separate angles – factors that you can’t control and factors that you can.

Factors outside of your control that affect a retail buyer’s decision

  1. Your product and its target customer has to fit in with the foot traffic and typical customer that store has.
  2. Buyers and stores want to stand out from their competitors. One way they do this is by stocking different products. If your product is in pharmacies, a major pharmacy chain may not want to have you in their store because of that. Exclusivity within niches (store types) is a big factor for retailer buyers and something to consider when you’re onboarding stockists.
  3. Finally, a retail buyer won’t want to put another product in their store that will jeopardise their existing products and sales. This point is particularly important if you’re outreaching retailers. If you know a store already has a natural skin care line, they may not want to stock yours.

Factors you can control in acquiring more stockists for your business

  1. Have a great product;
  2. Have great packaging;
  3. Be a competent, honest and trustworthy business owner when the retailer contacts you;
  4. Have a community of customers who love and rave about your product openly (we’ll talk more about that process in a future post);
  5. Have a clear-cut plan for company growth and direction to show the retailer you’re serious; and
  6. Show the retailer you are able and knowledgeable at managing wholesale relationships by showing them your existing wholesalers (either on your site or on a phone call).

If a retailer contacts you, they’re putting themselves out on a limb to try your product in their store.

Don’t waste their time. Don’t flake. Do great business with them.

While we’re talking about good packaging and branding, I want to show you where we were with our packaging at this point:

You can't sell your product wholesale without correct labelling and packaging so our first packaging designs had to be redone in order for our product to be sold in stores.

I spent 12 hours putting each sticker on the front and back of each individual packet to save money on our supplier doing it for us. This was our MVP packaging.

When our buyer came back to us and said she wanted our face masks in Queensland’s biggest chain of pharmacies, we were beyond excited… but also incredibly stressed.

We needed to pull off a full branding redesign in 30 days.

We hired a designer, but we stupidly thought we were designers and should have a majority say in the final product. This is what we arrived at –

Bad product packaging can still be good enough.
I don’t usually post colour photos on my website but this monstrosity deserves to shine.

I know what you’re thinking.

Lucy, you said were a designer in a past life. How did you create this abomination?

I take full responsibility for my mistakes, but in this case, I’m going to blame my non-designer Co-Founder who insisted on the blue geometric circles in this packaging.

And the mask on the front of the box.

And the blue.

I’m also blaming me for not having the stomach to stand up for what I believe in (but more on that in a later post).

Even though the redesign was a terrible failure from an aesthetic point, it was also a huge success when you look at the progression of my company –

We went from 0 to having our first wholesale enquiry in a few months by focusing on the consumer route. That's one way to build a wholesale business.

Remember how I mentioned in my first post that I was terrified of losing my initial investment? Well, the redesign represented the sale of almost all those masks which was a major milestone for us.

This, combined with the potential of wholesaling to Malouf Pharmacies, made Michael and I decided to continue with the business and see where it took us. I remember feeling so excited at this point in the business.

The possibilities seemed endless.

Maybe we’ll sell out the first day we’re in the store.

Maybe L’Oreal will find out about us and try to buy our company.

Maybe L’Oreal will find out about us and squish us while we’re small by releasing a similar product.

I’ve never been good at setting realistic goals, hovering somewhere between overly and excessively optimistic. This is another great example of my fervent optimism.

But we were in and it was our buyer’s belief in us that helped us make the decision to not only continue with the business but to pursue the idea of this product being good enough to take as far and as wide as we could.

Let’s pause here

When I look back on the whole experience of wholesaling our physical product, I would say that it was a great way to add recurring revenue each month.

But it wasn’t the main focus then and it wouldn’t be the main focus for me now.

If I were to start another eCommerce business, I’d focus on direct-to-consumer knowing that retailers will find me naturally. Once I see one or two retailers having success with my product, then and only then would I attack this channel with a more assertive and structured strategy.

A big part of having a successful wholesale business is continuing to update your product range to give your retailers reasons to keep you in their stores. Not only that, but you have to give your customers reasons to stick with you.

Who wants to keep buying from a business that isn’t changing and evolving as the years pass and as you do as their customer? Nobody.

In 2016, I went to Cosmoprof in Hong Kong and China to see the world’s biggest skin care exhibition. What we saw there blew us away.

Going to wholesale opened my mind in many different ways, mostlyin helping me to realise that Trefiel wasn't the long-term business for me. I could build a wholesale business, I could build a consumer-friendly business but I couldn't build passion into it. I could't.

 

We were the smallest fish in a tiny, over-crowded pond.

It was while we were at Cosmoprof that I realised how difficult it was going to be to create a range of products that were as good as the mask. I tried hundreds of samples until I had no skin left to try new products on. That’s when I started taking the samples home so I could try them once my skin had dried out.

Every product I tried had something that wasn’t right. I never had a moment where I thought –

This product is good enough to sell to my customers.

They were passable, they were terrible, they were good but they didn’t match the results the masks gave and I couldn’t release any of them to my customers knowing that.

Going through the process of trying to build out a product line for Trefiel also made me realise how little I wanted to do that. It was the next logical step if we wanted the company to continue to progress, but in my heart, I didn’t want to do it.

Later, I would look at this moment as pivotal.

This was one of the first indicators that I didn’t have the passion for skin care to continue the fight to build my company.

As much as I loved my business and being a business owner, I couldn’t deny this truth.

But… we still have a lot to talk about regarding what happened before that decision was made. Like releasing our new range of four face masks, launching a subscription box and everything I’ve learnt about successfully launching products.

That’s what you’ll find in the next post.

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There are 13 posts planned out – from starting an eCommerce business to influencer marketing, branding, wholesale, outsourcing, hiring, firing and a few other valuable lessons I learnt while growing my own eCommerce business.