Before I order 1000+ bottles of supplement, I need a plan!

Bushi23 · Apr 10, 2013

So this supplement contains an herbal extract which was used in recent scientific studies to reduce the effects of alcohol (help you get sober faster) and to prevent hangovers the following morning.

The pill does work, I've tested it along with some others in my area (University).

After finally finding a manufacturer who could supply me, I've learned the minimum order is 1000+ bottles.

This led me to my next question:

Where on earth do I market this? How do companies get their product out into the world? Walk into a local nutritional shop and see if they'll buy it from me? Do I pass out flyers? FB Ads and sell online? I'm completely at a loss. Ah the wonders of trying to go fast lane!

any help would be greatly appreciated.

MJ DeMarco · Apr 10, 2013

You might want to read a book on marketing before you buy 1000 of anything. Would you buy an airplane if you didn't know how to fly it? And couldn't afford someone to fly it for you?

Jason K · Apr 10, 2013

Bushi, you could do all those things. And don't forget advertising at bars. RIGHT in front of your target market, oh yeah.

You can create buzz by finding out who the regulars are at bars and giving them a free bottle in exchange for feedback. And assuming it works for them, they'll be telling their bar friends about it with a smile, too.

What you want is a strong, steady stream of qualified buyers. FB could be as simple as an ad that says "Click 'LIKE' If You HATE Hangovers" or "New Hangover Cure - $8.95 - Click To Buy", depending on whether you run a Like or Buy campaign. But do your research first and niche down to find your market. Who buys hangover cure pills? Who has the expectation that they will work? Younger or older? Male or female? Income level?

Once you figure this out and start driving traffic to a sales page, you will also need a payment processor and shipping system.

The market for this product IS out there, especially if the pill works.

MJ DeMarco · Apr 10, 2013

And don't forget to buy product liability insurance either...

GuestUser8117 · Apr 10, 2013

Awesome idea.

thehawkman · Apr 10, 2013

You could try to negotiate a lower volume with them. Asking you to buy that much upfront seems a bit much. Remember the Will Smith movie "Pursuit of Happyness" where he bought lots of devices he was having a hard time selling.

Bushi23 · Apr 10, 2013

MJ DeMarco said:
And don't forget to buy product liability insurance either...

MJ, just spoke to a friend who sells insurance. He talked to his boss and he told him that a general liability policy would cover this. I'm going to look into this more tomorrow during business hours by calling a few commercial insurance agencies, but thought I'd ask you if this seems like correct info.

Mexidan · Apr 10, 2013

I am in a similar situation where they have a MOQ of 5000.
If they could give me a test batch of 100 or so it would help me to start selling to customers but 5000 is a big jump.
No good advice here yet.. sorry.

DrkSide · Apr 10, 2013

Are you planning on both online and offline sales? Look around and listen to Jason K on his ideas.

For online testing of the market you can try the steps HERE and see what you get. Also, depending on where you are located find the nearest college town and get to work. Also, look for a high volume of active, young professionals that go to the bars. These are some of the main people that this will be marketed towards in my opinion.

WillMitchell · Apr 10, 2013

I'd definitely run some validation tests before putting in that 1,000 bottle order...You can also use those tests to build up a list of people to market to, and see what product features / positioning angles will be the more effective.

Good luck!

Bushi23 · Apr 10, 2013

DrkSide said:
Are you planning on both online and offline sales? Look around and listen to Jason K on his ideas.

For online testing of the market you can try the steps HERE and see what you get. Also, depending on where you are located find the nearest college town and get to work. Also, look for a high volume of active, young professionals that go to the bars. These are some of the main people that this will be marketed towards in my opinion.

I plan on selling both offline and online. Also, I'm located in a big college town so I have that going for me.

@WillMitchell, I'm going to be running an ad on FB like Jason K suggested. I'm going to run it as a "LIKE" campaign, and on that page I have the link to my landing page where they can enter their e-mail and sign up for a free sample. Any other suggestions?

WillMitchell · Apr 10, 2013

Bushi23 said:
I plan on selling both offline and online. Also, I'm located in a big college town so I have that going for me.

@WillMitchell, I'm going to be running an ad on FB like Jason K suggested. I'm going to run it as a "LIKE" campaign, and on that page I have the link to my landing page where they can enter their e-mail and sign up for a free sample. Any other suggestions?

I would take Jason K's other suggestion and run a "Buy" campaign.

It's pretty rare that I ever send FB PPC traffic back to FB. I don't think you'll get an accurate gauge of your product's potential if you just run a like campaign. Don't get caught up with vanity metrics. I think the best thing you can do right now is see if you can get people to buy your product, not start building your FB page. So ya, Jason K's other suggestion

Bushi23 · Apr 10, 2013

WillMitchell said:
I would take Jason K's other suggestion and run a "Buy" campaign.

It's pretty rare that I ever send FB PPC traffic back to FB. I don't think you'll get an accurate gauge of your product's potential if you just run a like campaign. Don't get caught up with vanity metrics. I think the best thing you can do right now is see if you can get people to buy your product, not start building your FB page. So ya, Jason K's other suggestion

How do you recommend I do that? Should I set-up an ecommerce site without any product and see if I get orders? Isn't that in itself an investment? Or should I just run a "BUY" campaign and have them enter their email to 'pre-order'?

WillMitchell · Apr 10, 2013

Bushi23 said:
How do you recommend I do that? Should I set-up an ecommerce site without any product and see if I get orders? Isn't that in itself an investment? Or should I just run a "BUY" campaign and have them enter their email to 'pre-order'?

Yes, run people to a landing page that has variations of your name, tagline, positioning, USPs, logos, packaging, etc. Read the article above, it's specifically about that. I also have another article that shows how I use that method for logos.

Testing these things before hand saves you from a huge amount of future work/costs

Eskil · Apr 10, 2013

First, shop around some more for other manufacturer who could give you a lower MOQ. You could tell them you're willing to pay them a little extra per bottle at first - in return for doing a smaller test run for you. Some manufacturers will do this if you let them know you are serious.

Jason K's tip about bars is good, and I would also try to ask local convenience stores and gas stations (especially if they are nearby places where people drink), if they would place a small counter stand with some of your bottles for you. Give them an offer they can't refuse of course.

edpaiz · Apr 11, 2013

If you are absolutely certain the product will work, take the 1,000. Set apart 100 of those bottles to send to stores that you think can have a steady stream of customers so that they can make monthly requests for more bottles. Make sure to create some marketing materials to give to the stores to get your supplement to stand out. Even though your market is for people that drink at bars, no one when is at a bar is thinking about next days hangouver since they are having fun and the extra 10 bucks will be spent on drinks... i would market the product through low end pharmacies that include grocery store such as CVS etc... so try to get into the big retail pharmacies, and while your at it target local smaller pharmacies to get some traction on your business while you nail the big retail stoe deal.

DennisD · Apr 11, 2013

Lets say you order the entire 1K.
How many sales before you break even?

Bushi23 · Apr 11, 2013

DennisDuty said:
Lets say you order the entire 1K.
How many sales before you break even?

I have yet to hear back on the quote, but from what I've heard I'm assuming around 4$ a bottle. If I can sell them for 10$ a bottle that would be 400 bottles until breakeven.

@edpaiz
I am sure the product works, but I can't help but feel overwhelmed at the thought of trying to sell all these bottles. The thought of negotiating a deal with retail stores terrifies me. Where do I begin?! Maybe I should just order the bottles and this will force me into confronting my fears.

magneto · Apr 11, 2013

Bushi23 said:
After finally finding a manufacturer who could supply me, I've learned the minimum order is 1000+ bottles.

Too risky! Skip buying from the manufacturer or buying any inventory in the testing phase.

Setup an e-commerce shop and drop-ship a similar product to customers to test out demand for the product. If drop-shipping for a similar product is not available, then buy the product at retail price whenever someone places an order on your website, and ship to them without keeping a cut for yourself.

Making profits isn't important right now, not losing any money is. This approach will also help you learn all those things you mentioned you have no clue how to do.

Eskil · Apr 11, 2013

Bushi23 said:
I can't help but feel overwhelmed at the thought of trying to sell all these bottles. The thought of negotiating a deal with retail stores terrifies me. Where do I begin?! Maybe I should just order the bottles and this will force me into confronting my fears.

I think you will find that getting small convenience stores, gas stations, or smoke shops to test them for you could be easier than you think. If you go into these types of retail locations, you will see all kinds of crazy stuff sitting near the cash register - where people make impulse buys. In the 2+ years I have lived where I am now, my local gas station has had at least ten different products (coming and going) sitting there along with the standard stuff like 5-hour energy, novelty lighters, etc. Those items they rotated in and out were obviously test products. Some stick around, some don't.

Even places like pawn shops and hardware stores have a range of snacks, energy drinks, candy, trinkets, doo-dads near the checkout stand these days. It doesn't hurt to ask these places if they would be willing to do a test run for you.

Bushi23 · Apr 11, 2013

Eskil said:
I think you will find that getting small convenience stores, gas stations, or smoke shops to test them for you could be easier than you think. If you go into these types of retail locations, you will see all kinds of crazy stuff sitting near the cash register - where people make impulse buys. In the 2+ years I have lived where I am now, my local gas station has had at least ten different products (coming and going) sitting there along with the standard stuff like 5-hour energy, novelty lighters, etc. Those items they rotated in and out were obviously test products. Some stick around, some don't.

Even places like pawn shops and hardware stores have a range of snacks, energy drinks, candy, trinkets, doo-dads near the checkout stand these days. It doesn't hurt to ask these places if they would be willing to do a test run for you.

Eskil, by test run, do you mean just ask if they'll let me place them there for free, and share the profit from the sale?

Jason K · Apr 11, 2013

WillMitchell said:
Yes, run people to a landing page that has variations of your name, tagline, positioning, USPs, logos, packaging, etc. Read the article above, it's specifically about that. I also have another article that shows how I use that method for logos.

Testing these things before hand saves you from a huge amount of future work/costs

Right, the OP doesn't need a whole ecommerce site, just a landing page (or several for split testing). These are pretty easy to set up. Since you're sending traffic directly there from an fb ad, you don't even have to have a fancy url--I could host one as a subdomain for you for free.

Then you need a paypal account and at least one other payment processor as backup. Set up your copy, get your button pasted in there and off you go.

DennisD · Apr 11, 2013

Ever see liquor stores with "5 Hour energy" at the checkout counter? That's for 'next morning recovery' by people making impulse buys.
It would be very easy to break into this market.

Are these BIG bottles or SMALL bottles?

How big are the bottles? I bet a smaller bottle with enough pills for one day of recovery would sell pretty well at $4/$5 pricepoint at a checkout counter. The bigger bottles would probably sell better online with a viral video/graphical campaign attached.

Twiki · Apr 11, 2013

Bushi23 said:
Eskil, by test run, do you mean just ask if they'll let me place them there for free, and share the profit from the sale?

This is what Stephen Key did with his Hot Picks idea that turned into a 7-figure revenue generator.

When I set out to confirm that consumers were interested in HotPicks, I asked the manager of a local gas station to display the picks on the checkout counter. Any sales he made, he could keep. I just wanted to know if and how fast they would sell out. When I returned the next day to check in, they had all been sold! I could hardly believe it. At a gas station, of all places. I was energized and excited and quickly began testing the picks in other settings. This is just one example of the multiple strategies I used to test the picks before moving forward.

Don't Reinvent The Wheel, Reinvent The Guitar Pick | Fast Company | Business + Innovation

Mr. Key is on this forum and he is such a genuinely helpful guy! I don't know if he'd have any input re: supplements but check out his work in general.

Eskil · Apr 11, 2013

Bushi23 said:
Eskil, by test run, do you mean just ask if they'll let me place them there for free, and share the profit from the sale?

Yes pretty much just that

How much of profits you want to share is up to you, but as magneto pointed out earlier - the most important thing isn't to make profits from day one, but rather to see if these will be flying off the shelves, or if they will be a bust (which, in this case I doubt).
The more you can give to the retailer for them helping you out - the more likely they will be to agree on this.

As an example... for the physical product I am developing right now, I am having a small amount of units hand made to send out to top influencers on Youtube and blogs who can help me spread the word and create awareness of its existence. I'm not making a dime off of these as I will give them out free to a select few - but I know that if each one of them can result in at least 1 real sale of the product, I have already made back several times what it cost me to make this first batch.

But even more importantly - I have then confirmed that the product is indeed wanted. Validate the demand - then it's pedal to the metal...

Besides, you should be able to find a contract manufacturer that can do less than 1000 bottles for you.

Bushi23 · Apr 11, 2013

DennisDuty said:
Ever see liquor stores with "5 Hour energy" at the checkout counter? That's for 'next morning recovery' by people making impulse buys.
It would be very easy to break into this market.

Are these BIG bottles or SMALL bottles?

How big are the bottles? I bet a smaller bottle with enough pills for one day of recovery would sell pretty well at $4/$5 pricepoint at a checkout counter. The bigger bottles would probably sell better online with a viral video/graphical campaign attached.

The bottles from the manufacturer currently quoting me would be a larger bottle with around 30 pills. I know that one pill is enough for the average weight individual, and I asked them if they could do smaller packaging. They told me it would be much more expensive.

There is the option of purchasing the extract in powder form and packaging them myself, which would definitely be cheaper than ordering bottles (only if I'd be selling individual pills). I guess the next step would be figuring out what to package them in and then from there I could try the test runs at gas stations.

DennisD · Apr 11, 2013

I imagine something like this:

NSFW (erection pill with sexual images):
http://ecx.images-amazon.com/images/I/51NUb7VreWL._SL500_SS500_.jpg

REALLY well designed packaging targeted towards the college market at the counter. Single pill in a single package for $3-5.

Imagine that? If 30 or so pills cost around $4 and you sell each ONE for $4? The entire order costs you around 4K to order, and you make 120K off of it? Sounds good to me.

Bushi23 · Apr 11, 2013

DennisDuty said:
I imagine something like this:

NSFW (erection pill with sexual images):
http://ecx.images-amazon.com/images/I/51NUb7VreWL._SL500_SS500_.jpg

REALLY well designed packaging targeted towards the college market at the counter. Single pill in a single package for $3-5.

Imagine that? If 30 or so pills cost around $4 and you sell each ONE for $4? The entire order costs you around 4K to order, and you make 120K off of it? Sounds good to me.

Wow, that type of packaging is perfect. I wonder if that's something manufacturers only do for very large orders. Time to find out.

Eskil · Apr 11, 2013

DennisDuty said:
If 30 or so pills cost around $4 and you sell each ONE for $4? The entire order costs you around 4K to order, and you make 120K off of it? Sounds good to me.

Yeah sample sized products isn't a bad idea at all, especially for products where you can feel the effect quickly. But keep in mind too that the packaging and printing of each sample size isn't exactly free, so you might be looking at like $1-$1.50 give or take for each.

Bushi23 · Apr 11, 2013

I have a feeling trying to package a pill like that will be on the expensive side. I've already sent out a few requests for quotes but until that comes back with prices, what do you guys think about something like this with a pressure seal: 2 oz HDPE Black Diamond Round : Royal (Diamond) . I know it's definitely not traditional packaging for a pill but perhaps it could work for testing purposes? Cheap enough to buy single, and I could print my own labels.

Edit: http://www.containerandpackaging.com/item/B613 this looks a little more like a pill container.

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