Complete   Sales & Marketing Solutions

 

FREQUENTLY ASKED QUESTIONS

  • What is a Food Broker?

    A Food Broker is an independent agent who acts on behalf of a manufacturer in selling and marketing the Manufacturer's Products.

  • Why would I use a Food Broker versus selling myself or hiring a salesman?

    Food Brokers represent the most cost-efficient method of doing business. A salesman who is a direct employee is a fixed cost; a commission to a Food Broker is a variable cost tied directly to the volume being sold. It can be added as an exact figure to the cost of goods. Food Brokers also enjoy a close relationship with the accounts they do business with. They understand the needs and goals of their accounts and build their programs around them. The familiarity of the Food Broker to the Trade adds more credibility to any line of products that the Food Broker is selling.

  • How much does a Food Broker charge for their services?

Typically, a commission of 5% is paid on Branded Products and 3% on Private Label (Store Brand) Products. General Merchandise and Health and Beauty Care products sometimes pay a larger commission. If a particular line of products has no present distribution, many manufacturers choose to pay a minimum monthly commission ranging between $1,000 and $2,500 for the first 6 months. This minimum is paid to compensate Brokers for out-of-pocket expenses in establishing a new product in the market while no regular commission is being collected.

  • How do I select a Food Broker?

The Food Broker you select should already be selling in the department your product is destined to be sold. Many Brokers tend to specialize in departments such as Frozen Food or Confection. To assign either of them a Deli Product would not be wise. Consideration should also be given to relative size of the manufacturer to the Food Broker. The Food Brokers capabilities should be in proportion to the level of revenue that a particular line of products pays. Interviewing a few potential Food Brokers will give a good feel for their differences. You might find that if your product has no present business, no Food Brokers will be interested in your line in the absence of a guaranteed minimum commission.

  • How long am I required to commit to a Food Broker?

It used to be that the industry operated on a 30-day contract; those days are over. Given the time and effort in launching and maintaining a line of products, most Food Brokers will insist on a one year minimum contract with automatic renewal based on satisfactory performance.

  • How quickly should I expect results?

Given the extraordinarily competitive environment, the time between assigning a Food Broker and actually getting an order is about 6 months. Getting appointments, presenting the products, product approval, and shelf resets have added greatly to the time line. Some buyers review categories only at specific times of the year; others have the added step of securing a distributor for the line of products before they can be presented to the trade.

 

 

 

 

 

 

 

 

Regional Access Inc. 4655 Linglestown Road Harrisburg, PA 17112.

Phone: 717-657-5702 Fax: 717-657-7939