Tiege Hanley in Retail? | Tiege Hanley VLOG 170 HD
TIEGE HANLEY IN RETAIL? VLOG 170 A lot of people think that retail is the ‘pinnacle of success’ – Aaron used to think so too. About five to ten years ago, this mindset may have been true – where in order to scale your business & brand, a business would need to strive to get into a big box retailer. Even today, getting a call from a big box retailer is intoxicating. Think about it: it’s sexy and exciting seeing your product on the shelves of Target or Ulta. But is it smart for your business? Retail has its headaches and problems, which Aaron lays out a worst case scenario here. The first hurdle is the amount of capital needed to purchase the required inventory. Imagine going into all Targets at once! Depending on the big box retailer, the product may be tested in a demographic before being rolled out completely—regardless, the capital requirement is massive. Some of the big box retailers purchase inventory like a wholesaler, but then the price is dictated by the retailer. Your profit margin shrinks although it can be made up from volume sales. After getting the products into inventory, brand awareness advertising is necessary such as someone on location to pitch the products or a message strong enough to set your product apart from the competition. If not, the products may end up sitting on the shelf with the retailer requesting you take the inventory back. Let’s take a look at what happened to Aaron’s friend Eric of Beardbrand who expanded into retail via Nordstrom. He placed his products in ALL Nordstrom stores where a push has been to increase the availability of men’s grooming products. The product didn’t move, and he ended up pulling all of his products out. Ultimately, you’re at the mercy of the big box retailer. If you contemplate venturing into retail, do your due diligence before getting involved. A good example of the control they have over your business is how Home Depot dictates how much they’ll pay you as well as how much they’ll charge. The Internet has changed the game regarding attaining brand awareness, profit, and control of your brand. With the Internet, you’re in control of your business destiny and in a better financial situation overall. For example, you don’t need a big box retailer with Amazon where you can leverage the Internet plus the low cost of doing business. Keep in mind Amazon presents a different set of issues such as steep competition as well as requirements. Tiege Hanley has had the opposite strategy of retail from the get-go. They decided from the beginning not to make the push to go retail and instead to go exclusively online to the customer. They’ve been able to offer a high quality product with a lower price due to selling online – the price would more than double if sold retail. Ultimately, they’ve been successful and have grown without retail – but the temptation is still there because retail is alluring, seductive, and sexy. TIEGE HANLEY UPDATES The new $70K website launched, and the feedb
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