Philosophy

source first

The Four P’s of marketing—Product, Price, Promotion, Place*—commonly referred to as the Marketing Mix, have proven key to the success of product launches and been taught in business schools for decades. However, sourcing, the necessary precursor to this Marketing Mix, is often overlooked despite it’s importance. Marketing focuses on the selling side of the business, but there can be no ‘Product’ or ‘Price’ without proper sourcing.

*In the Marketing Mix, product encompasses the characteristics of the item which you are selling, including the quality, packaging design etc. Price refers to the pricing strategy you have adopted for your product. Promotion involves the various mechanisms that make people aware of your product. Place refers to the market that you intend to target.

Success of the Marketing Mix has a lot to do with successful product sourcing, which is dependent on what we like to call The Three P’s of Sourcing—People, Product, Price. The time leading up to placing your first order with a supplier is when you have the most leverage. During this “honeymoon” phase, both parties are willing to do what it takes to consummate the union. You must take the time to make sure the Three P’s of Sourcing are in place.

PEOPLE

Corporations are made up of people. Just as there are many types of personalities in the world, Corporations have various personalities. Often the personalities and attitudes of the CEO and upper management of a company, large or small, directly impact and shape the attitude of employees further down in the hierarchy.

When sourcing new products or new suppliers for existing product lines, you have to consider the people that you will be working with. What are their attitudes towards the sales relationship? What is their vision for the longevity of the relationship? Do they dictate the terms or are they willing to compromise? First impressions are vital and it’s crucial to understand who you are working with. Too often, an eager buyer makes compromises or concessions in a rush to get a new product to market without understanding their ramifications. Although compromise is important in negotiations, one should never compromise on anything that could harm their own company down the line.

For example, if you require exclusivity in you market from a particular supplier, it must be a condition from the first order. Many buyers succumb to a laundry list of seemingly sound arguments that allow the first order to market before a decision on exclusivity can be made. This list is often one sided. Forgoing an important pillar of your requirements is not compromise, it is capitulation and often leads to a one sided relationship moving forward. The leverage that comes with that first order is currency that must be thoughtfully spent.

Our suppliers have all been vetted and you will be working with people that share our values.

Product

All too often, important aspects of a successful product, such as proper package design and quality are sacrificed. Often, price and profit become the buyer’s sole motivation, rationalized by a “competitive market” to the detriment of everything else. It is no accomplishment to have the cheapest, but worst looking, worst tasting or worst performing product in the market. Yes, your customers may rush to buy once, but what will be their motivation to purchase again? If the three P’s of sourcing are not balanced then there should be no surprise when the retention rate is not there.

It is a fallacy to believe that promotional support in your market and free samples will make any product sell. You can give away as many free samples of a subpar product as you want, but at the end of the day all you are doing is showing your customers, at no cost to them, how far short your product falls. You have to take a moment during the honeymoon phase to ask yourself, is this supplier being supportive because they are the right people to work with or are they making up for the fact that they know their product is lacking?

We take the time to ensure that the product is the right quality and presentation for your market. Professional Package Design is included in the value added services that we provide.

Pricing

At the end of the day, no matter how perfect the product or how supportive and co-operative the people, if the price is irrationally high you won’t be able to carry out a successful launch. A keen buyer will be able to know if this crucial third P of sourcing is in balance with the first two P’s.

Sometimes it is okay not to have the cheapest price in the market as long as your price is still competitive, your product is excellent and your supplier is totally committed to your success via promotion. Balance is the key. Having a product with excellent attributes and a supplier that supports you comes at a price, but goes a long way in creating awareness and generating repeat sales. Once that connection is made, you will have a competitive advantage that is greater than having the cheapest price could have even given you.

We work hard so that you will never be compromised on price relative to your competition. We work with the best people to ensure that the price you pay will be a function of the product’s attributes and the support you will receive.