Starting up your 2011 Business Plans

We are near the midpoint of the calendar year and for many companies, this is also the middle of the fiscal year. This is also a key time to start setting 2011 objectives. By now you should understand if your 2010 objectives are on track and what measures must be taken to ensure you meet budget/plan. Your vision should take you into 2011 opportunity planning.

First initial step for 2011 planning:

As most employees are overwhelmed with current priorities, it's important to make this a fun process. Get your team together and set the rules. Create sheets and divide into 4 columns:

• Opportunity
• Cost of Opportunity
• Probability (1-4) (1 being most likely to succeed)
• Potential Dollar Volume
  

Now just brain storm. No idea is a bad idea, think out of the box and title each sheet accordingly:

• Current Customers
• New Customers
• Promotions/Marketing and Merchandising Tools and Ideas
• Food shows and Customer Events
  
• Product and Category Opportunities
• Cost Savings

This is a great way to start the planning process for 2011. Include representatives from marketing and finance only if you feel it will lend positive feedback and maintain an open thinking process. Order in pizza/lunch, close the doors and shut off all outside interference. Even offer an incentive to the participant who delivers the best idea---and have the team vote on it. Everyone feels committed. Everyone feels involved. It may even get them excited about the 2011 planning process.

Launching Products into Foodservice: The Consolidation Challenge/Opportunity

In the last three months I have had the opportunity to work with 3 outstanding entrepreneurial companies who want to enter into foodservice distribution. All 3 have products with unique attributes. They all bring to the table the latest trends highlighted by the top chefs and foodservice magazines. The quality of their products are certainly beyond what is currently available in the market. So why are they not a "slam dunk" easy entry into foodservice?

The wonderful world of foodservice allows a manufacturer to tap on many different avenues to gain profile for distribution either via distributors or operators. However; continued movement towards consolidation and larger customers and manufacturers make this increasingly more difficult. Here are some reasons:

• Distributor Opportunity: As distributors continue to consolidate (as with SYSCO Ontario) they will reviewhat they have in their warehouses. They will want to seek out redundancy and look for ways to make more money on what they put in their warehouses. This will be positive for manufacturers that have unique products with customer demand, but there is also the tendancy to want to support the larger manufacturers who are already preferred in the category and drive their purchasing revenue.
• Customer Opportunity: There are fewer customers who can drive listings and those who have this power are overwhelmed by manufacturers who see them as the key to their success. Many of these customers do not have the time respond to the constant barrage of manufacturers vying for their attention.
• Manufacturer Opportunity: Yes manufacturers continue to consolidate. This can make it more challenging for smaller entrepreneurs as their products often represent part of the larger manufacturer's category and the larger manufacturer could duplicate their product easily if they made it their focus. But there lies the challenge. Big manufacturers cannot turn on a dime. Most have to complete arduous protocol before they can change, tweak or launch a new product and few will be the first to "launch" innovation.

So what are the learnings for the smaller entrepreneur wanting to enter foodservice right now:

• Target the key customer(s) who will list your product and understand the volumes needed to secure listings.
• Think "out of the box" to grab the attention of your target customers. This involves using your contacts and ingenuity to find out more about the customer--their focus and priorities. Figure out how your product can meet their objectives. Now grab their attention by using your product to show them how they can meet their objectives.
  
• Be perseverent. The customers you are targeting all have their preferred vendors. It is difficult to become part of this circle, especially as most of these preferred vendors are already manufacturing items in your category. It may be a matter of timing and circumstance that will eventually get you their ear and their business.
  

Remember very few successes come easily. Keep committed to your goals.

Successfully Launching Products into Foodservice Distribution

As the CRFA show draws closer, many manufacturers look to this show to see if their products are a fit for the Foodservice Industry. The hope: to be discovered either by an enduser who can drive their listing into distribution or a distributor who realizes that there is a need for a specific product in their warehouse.
While this show and most shows are a great tool for growing manufacturer product sales, it will be rare that a manufacturer will launch into strong distribution by being discovered at a show.
Warehouses are bursting at the seams. Distributors do not want product redundancy. Unless you have a unique product, with a desirable price point and a customer who can purchase the critical mass needed to secure the listing, it is tough to launch "easily" into foodservice. Saying this though, there is still lots of opportunities in foodservice for new entries. Here are key criteria needed to secure a listing and grow your foodservice sales:

• Know and sell your point of difference in foodservice---your competitive edge.
• Know and sell to your target market. Always prioritize your "low hanging fruit"---the most likely "supporters" of your product.
• Know the critical mass/product sell through needed to secure a distributor listing and ensure you are targeting customers who can support this volume.
  
• Be competitively priced and target your tradespend money to the customer(s) who will drive your sales.
• Commit foodservice sales and marketing resources to maintain and grow your volumes.

Lastly, the above criteria are challenging for a company who does not know the foodservice landscape. It's important to link into key foodservice resources who understand the industry. This can definitely help prevent the added roadblock of hitting your head against the wall.

The 3 Key Business Fundamentals to keep in mind in 2010

There are three simple fundamentals for foodservice growth that will keep you focused on achieving positive results this year:

• Foodservice sales growth means strategically directing your resources to products and customers that deliver profitable return on investment.
• Foodservice sales growth is achieved by simplifying and limiting your business objectives and ensuring alignment throughout your company.
• Controlling costs mean keeping focus on what truly will grow your sales and managing your spend on initiatives with limited/no return on investment.