Lunch Lesson Four - Distribution

In the shops - at last!

The American inventor Thomas Edison observed that genius was 1% inspiration and 99% perspiration.

Many a small business will agree that getting a bright idea on to the shelves is a journey of blood, sweat and tears.

It's certainly true for Pete Rickett and his colleagues at Design Works in Windsor.

They came up with a stabiliser for a child's bike which would allow the cycle to tilt but not fall over. This way children could get used to balancing themselves.

Progress

Working Lunch has followed the company's progress since Pete first told us about the idea in 1999.

Pete: Took longer than expected

It's taken a long while, but the product is now available in shops, from independent bike specialists to big names such as Argos and Halfords.

"We thought within 18 months it would be out in the marketplace," admits Pete.

But a big problem was that retailers wanted to see a finished product before they made up their minds - and that cost money.

Like many business success stories, an element of luck was involved.

Philip Rushforth read about the stabilisers in a newspaper and thought his company could help.

He's sales and marketing director of Tradewinds, which sources and supplies goods to some big High Street names.

Potential

"The product looked very interesting because we are in the cycle business and we sell conventional stabilisers," says Philip. "It certainly had potential."

The first step was to take a hard look at the prototype and make some decisions.

"It's no good developing a lovely product that ultimately will be far too expensive to sell," explains Philip.

Philip: A price had to be decided first

"We had to look at the engineering of the product to arrive at a notional retail price.

"Having done that, we had to get it manufactured. We knew we would have to do that in the Far East, and we had those sources."

Tradewinds advised that building it in metal would add to the production costs and Design Works agreed to change to injection moulded plastic. It also came up with the packaging and identified possible outlets.

Each company put £30,000 into the project, but some big retailers soon agreed to put the product in their shops.

This partnership was just what Design Works needed. The company had spent ages trying to get someone to take the stabilisers on for them with no success.

Faith

"It was a very big job to swallow, but we had faith in the product," says Pete.

And now their baby has been delivered to the world. It has a new name - Rebound - and costs £17.99.

Because of Tradewinds' contacts, it's available in both large High Street and small independent shops.

It's hoped a deal will soon be done to distribute it in the United States and the manufacturer is able to sell it into Far East markets.

So the Rebound stabiliser, born in a small office in Berkshire, is now a global product.

"I think they were delighted when we found each other because they were beginning to wonder how they would get the product to market," says Philip.

Inspired

And it's inspired the Design Works team.

"We have learned a lot from this project in terms of manufacturing and marketing and it has encouraged us to go on to look at other projects," says Pete.

But no matter how great an idea, knocking on the doors of big retailers is unlikely to get results, even with the determination of Pete and his team.

"They might have done it - frankly I doubt it," says Philip.

"I think they would have needed some form of distribution, let alone development of the product.

"It's not impossible but we know how hard it is. And with the drive to cut the number of suppliers, it's getting harder and harder."

---

Student Guide

---

Pete Rickett knows that learning to ride a bike can be tricky but he and his team have made it easier with Rebound.

It allows the bike to tilt without falling over so children learn to balance.

A brilliant idea - but just try persuading big business to take up your idea.

It was a dispiriting business until Pete met up with Philip Rushforth at Tradewinds.

Philip guided the Rebound from prototype to finished product and found the product a home with big names like Argos and Halfords.

Just think...

The prototype of the Rebound was heavy and expensive so the final product needed to be different. Why would changes help persuade shops to stock it?

Hard to find the right place

You can make a product that people want to buy but it can be difficult to find a way of getting it to them.

It takes a lot of time and good persuasive powers to get to see the buyers at the big retailers.

Lots of people want to talk to them so you have to make a very strong case.

You have to put together a very convincing argument that your product is different and just what their customers want.

This can mean producing high quality marketing material to sell your idea. It all adds to the costs - before you've made a penny.

Just think...

What costs are involved in promoting your product to retailers?

Why can it be difficult to find the money and time to carry out this promotion?

What the big names want

High Street stores are always looking for innovative products to catch the customer's eye and make their shops stand out from the others.

They are approached by thousands of people and businesses who think their idea is the best thing since sliced bread.

If they looked at them all, they would need an army of staff to deal with them - an expensive process.

Any store will go through an initial sifting process to find products that meet their needs.

Even when they come across a great product, many don't want to buy just one product from a company.

Think about what it would mean - more work involved in ordering, deliveries and the finance department.

Just think...

What do you think stores will be looking for in a new product?

How does their customer profile affect the type of products they want to sell?

Why do you think a big store chain will be unwilling to buy from a company that sells them just one product?

Right product, right place

Tradewinds is a business which helps people get their products into the shops.

People take their products to a large retailer and if the retailer likes it and wants to buy it, these days they're not going to deal with you for one product. But they might point you in the direction of a company like Tradewinds. Philip Rushforth, Tradewinds

It advises on the product itself and helps the business to make sure that both the product and the price are right.

It then acts as a distributor so the stores can buy a range of products from one company instead of incurring the costs of buying lots of products from individual suppliers.

We've learned a lot from this project in terms of manufacturing and marketing. It's encouraged us to go on to look at other projects. Pete Rickett, Design Works

Businesses like Tradewinds know the market, know the buyers at the stores and know how to place the products.

Sometimes the buyers want a product for their stores and will come to Tradewinds to find it for them.

When Design Works and Tradewinds went into partnership, they combined their expertise and brought Rebound to the shops.

Just think...

What does it take to get a new product into the shops?

How does Tradewinds help both the designers and the stores?

How does it help the end customer?

How does the partnership between Design Works and Tradewinds add value?