Should You Hire a Food Broker?

Your product is awesome and you want to get on store shelves quickly.  Maybe you’re already selling direct-to-consumers online, but want to get your product in front of the vast majority of shoppers who usually shop in physical stores, rather than online. Note: an omnichannel strategy where you use both – e-commerce plus in-store, often works best.  Read our award-winning book about how the future of retail is omnichannel, available here.

So, you may be asking yourself, as a food manufacturer or brand, are you ready to work with a food broker?  (Read our post to see if you are ready – you should be past stage 1 – ‘5 Stages of Growing a Food & Beverage Business’)

So, what are the pros and cons of working with a food broker?

Pros:

1/ The most important pro is that brokers have existing relationships with retailers, and knowledge of how those retailers operate. This includes knowing how different organizations like to be presented to and the right trade shows to meet them. As well as deep sales and marketing expertise, contact databases and expertise using sales and marketing software.

2/ Besides opening doors to buyers at retailers’ headquarters, brokers can also manage other services you’ll need to make sure your product sells.  These include seasonal price promotions, special displays like end caps, in-aisle displays, coupons and product sampling.

3/ You likely have a lot on your plate already; outsourcing the heavy lifting (and it is heavy) of sales & trade marketing will allow you to focus on other things.  Like product development, manufacturing – in-house or working with co-packers.  And your online presence and e-commerce.

4/ Brokers may be significantly cheaper than hiring your own internal sales force.  Internal hires require salaries, benefits, office space, travel budgets to trade shows etc.  And candidates who are early in their careers may not bring much industry knowledge or contacts.

Cons:

1/ Probably the biggest negative of working with a broker is that they may represent many other brands. In some cases, including in your product category. You may not get as much focus and attention on your brand as you might hope; whereas an internal sales team is only focused on your brand.

2/ Brokers will of course charge fees; some are upfront, such as a monthly retainer in place while they build your sales; and also, the percentage of sales they require.

3/ If your brand is very mission driven or unique, a broker may not care as much about this as you; may not be able to present your unique values and mission as well as an internal team.

Conclusion:

There is no ‘right’ answer to the above questions; in many cases brokers can be a great way to accelerate your entrance into the right brick-and-mortar sales channels.   Saving you a learning curve and reducing your risk.  But if your team already has strong sales experience and experience in retail, you may not need a broker, at least not initially.

If you’d like to discuss us representing your product, we’d love to chat to see if there’s a good fit – schedule a discovery call with us, here.