E114: How to Lose Money Chasing Champagne Dreams of Retail Distribution

Monday, January 22nd, 2018 in Podcast

“The most finite resource you have is your time and your team’s time. So if we were to spin our wheels chasing this huge big box business, that would prevent us from spending our time to stuff that is hugely profitable and is continuing to work. So why take your eye off the ball?” – Bill D’Alessandro on abandoning the big box retail route

“My products are in 5,000 Target stores.”

Admit it, at some point in your ecommerce entrepreneur life, you wished you could say those words. Or let’s say you didn’t, but imagine for a minute that you’re at a party back home for Christmas and high school friends are asking what you’re up to, and then you say those words. Yeah, we’ve all been there.

But with all the allure of big box retail distribution comes headaches that you probably are not aware of. As an example, one big chain approached us about selling our coloring books on their shelves and we were psyched. But after running the numbers we realized that it’s not even worth it.

Today’s guest, Bill D’Alessandro, has gone through the big box retail route when he acquired a business that already had a retail presence. He tells us in this interview the woes he encountered and why he ultimately decided to no longer pursue that route.

Bill is the founder of Elements Brands, a company that acquires and scales consumer products brands. He has been buying businesses for 7 years now and currently owns 9 brands with over 130 products. He is not a stranger to this podcast and you can listen to a previous episode he has done with us about buying businesses vs. starting one from scratch.

Some conversation points:

  • The details of how Bill got into retail distribution
  • The advantages of mom and pop shops over big box retail
  • Treating mom and pop shops as big B2C customers
  • The actual costs of going into retail
  • What chains expect from a brand owner
  • The ridiculous fees chains charge to get your product in their shelves
  • What he plans to do moving forward

Bill is currently on the lookout for good businesses to buy and add to his portfolio. If you are planning on selling, you can contact Bill at [email protected] or hit him up on twitter at @billda

Resources mentioned:

Stamped.io
AsiaInspection

Thanks for listening to our 114th episode. Until the next one, happy selling!

Michael started his first business when he was 18 and is a serial entrepreneur. He got his start in the online world way back in 2004 as an affiliate marketer. From there he grew as an SEO expert and has transitioned into ecommerce, running several sites that bring in a total of 7-figures of revenue each year.


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