Getting Your Specialty Food Product Onto Store Shelves: The Ultimate Wholesale How-To Guide For Artisan Food Companies by Lewis Jennifer

Author:Lewis, Jennifer [Lewis, Jennifer]
Language: eng
Format: mobi
Published: 2014-07-27T21:00:00+00:00

Working with a broker means you’re putting your trust in another person and your brand in someone else’s hands. Try to meet with brokers in person—or, at the very least, via Skype or Google+ or FaceTime, etc.—to see if they pass the “gut check” and appear to be a good fit for your company.

SETTING THE TERMS OF YOUR WORKING RELATIONSHIP

You’ve narrowed down your list of prospective food brokers to the top contenders, but before you go too much further, you need to create a written contract to be sure that you and the broker are on the same page. As do some of the other service vendors we’ve mentioned, many established food brokers have stock contracts available, but as always, read it thoroughly and consult with an attorney as needed. You’re never automatically bound to everything presented in a contract; you can negotiate for changes to them before you sign. Don’t be afraid to negotiate hard for yourself and your company,

Whether you modify an existing contract or create one with an attorney, it should include the following points:

An outline of exactly which products the food broker will represent. Is it your full product line or a sub segment?

The geographic regions and types of stores the broker works in. Brokers often ask for exclusivity to a region or specific type of store. Since this prohibits you from working with other brokers in the same area, your contract should explicitly state the channel and geographic boundaries yours will be working within. When it doubt, always be more specific—”the Pacific Northwest” is a large and less definite region than “the state of Washington” or “a one-hundred-mile radius around Seattle.”

Set a time frame for when the contract is valid. Include a start and end date, what is expected in terms of performance, and what the procedures are for terminating the relationship (i.e., you will give the broker thirty days’ notice, etc.)

How much the broker will be paid and how often they’ll invoice you. Will you work on a cash accounting basis (you only pay the broker for orders after the retailer has paid you)? Or will you be working on an accrual basis (you pay the broker when the invoice is due whether or not you have received payment yet from the retailer). This is important to think about, because so many retailers you sell to may ask for net terms in which you agree to wait for payment up to thirty, sixty, or even ninety days.

Similarly, outline exactly what terms the broker may extend to retailers as well as procedures for opening up new accounts.

What action the broker must take on unpaid retailer invoices. This is especially critical when working with brokers who call on distant accounts that you cannot collect payment from in person if need be. In those situations, you’ll need the broker’s help to collect payment, so you need to agree on how many times you’ll contact a client for payment and, if that doesn’t lead to a resolution, what steps you’d like the broker to take.

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