The survival rules of suppliers and the cultivation of explosive products

The survival rules of suppliers and the cultivation of explosive products

As a supplier, in order to survive and break through in the market, and successfully enter this high-end market, suppliers not only need to have excellent product quality, but also need to demonstrate outstanding competitiveness in brand influence, supply capacity, and presentation proposals.

The survival rule of Sam's Supermarket suppliers: the battle between high-quality service and brand strength

Product quality control: Quality is the foundation of enterprise survival, and improving quality is the key to ensuring product competitiveness. Sam has extremely high requirements for product quality, and suppliers must provide high-quality products. For example, its fresh product suppliers need to ensure the freshness and safety of ingredients, and conduct strict screening and quality testing from the source.

Cost control and price advantage: Sam's product positioning is high-quality and competitively priced. Suppliers need to reduce costs by optimizing production processes, improving efficiency, and reasonably controlling raw material procurement while ensuring quality, in order to supply Sam at a lower price and attract consumers in the market with "cost-effectiveness".

Supply stability and ability to handle large orders: Sam's sales scale is large, and suppliers must have stable production and supply capabilities to provide Sam with goods on time and in sufficient quantities to meet its huge market demand. For some seasonal products or sudden large orders, we can quickly respond and adjust production plans to ensure that there is no shortage of goods.

Product innovation and research and development capabilities: With consumer demand as the core, continuously innovate product design to make products not only meet market demand, but also have multiple advantages such as beauty, practicality, and creativity. To lead the industry in product research and development, maintain technological advantages, and possess independent intellectual property rights and patented technologies. Sam focuses on providing unique products to consumers, and suppliers need to have strong innovation and research and development capabilities, constantly developing new products based on market trends and consumer demand.

The cultivation of explosive products

Accurate market research: Sam's and its suppliers will conduct in-depth research on consumers' needs, preferences, and purchasing behavior. Through big data analysis, consumer surveys, market trend research, and other methods, accurately target consumer groups and understand their specific needs for products, such as taste, functionality, packaging, and other expectations, in order to develop products that meet market demand.

Strict product selection and testing: Sam has a strict screening mechanism for the introduced products. The products provided by suppliers need to undergo multiple rounds of testing, including taste testing (such as food products), performance testing (such as daily necessities products), quality inspection, etc. Only products that perform well in all aspects have the possibility of being selected by Sam and pushed to the market.

Unique product positioning: Explosive products often have unique selling points and positioning. Some of Sam's products feature "large packaging and high cost-effectiveness", making them suitable for family purchases and stockpiling; Some products emphasize "health and organic" to meet consumers' pursuit of a healthy lifestyle; Some products may be innovative and unique, arousing consumers' curiosity and desire to try.

Effective marketing strategy: Sam will promote products through various channels and methods. In store, attract consumers' attention through eye-catching displays, tasting and trial activities, etc; Online, use social media, official websites, etc. to promote and advertise products. At the same time, Sam's Club will also combine its membership system to provide exclusive discounts and activities for members, increasing their willingness to purchase and loyalty.

Continuous optimization and improvement: Based on market feedback and sales data, Sam's and suppliers will continuously optimize and improve their products. If any problems are found with the product or if consumers have new demands, the product formula, packaging design, or functionality will be adjusted in a timely manner to maintain the competitiveness and market popularity of the product. For example, if consumers give feedback that a certain food has a too sweet taste, the supplier may adjust the formula to reduce its sweetness; If the packaging of a certain daily necessities is inconvenient to use, the packaging design may be improved.

The following is a successful case study sharing of Sam's Supermarket supplier survival rules:

Li Gao Food: Li Gao Food is the company with the largest market share in the frozen baking industry and was listed on the Shenzhen Stock Exchange in 2021. Its products mainly include frozen baked semi-finished and finished products such as sweet potatoes, tarts, donuts, frozen cakes, as well as baking ingredients such as cream, fruit products, sauces, etc. It also produces some snack foods. Freeze baking is its absolute main business. The success principle of Li Gao Food is reflected in:

• Cooperate with key customers and stabilize the source of income: The first major customer of Lego Food is Wal Mart Group (the group of Sam's Club). Wal Mart's contribution to the revenue of Lego's main business has increased year after year, from 4.7% in 2019 to more than 20% after 2021. The stable cooperation with Sam has guaranteed its considerable income.

• Meet channel needs and adapt to market changes: With supermarkets such as Sam's and Hema setting up "on-site baking" modules, the semi-finished dough provided by Li Gao Food can replace traditional fully baked restaurants in terms of taste after being processed by Sam's masters, meeting consumers' demands for both convenience and high quality, and adapting to market trends.

• Strengthen major products and constantly update: For example, Sam's Club's popular single product, Ma Shu, is a representative product launched by Li Gao Food in the second half of 2019. In the first half of 2020, its sales reached 25.3738 million yuan, accounting for 43.83% of the overall sales of Danish products. As of the end of the third quarter of 2021, Ma Shu has achieved a sales scale of nearly 300 million yuan. At the same time, LiGao Food is constantly upgrading its old products and introducing new ones, such as the pistachio cheesecake, Russian daleba, goji berry longan walnut cake, and other new products launched in Sam's Club, attracting consumers through a single product strategy and continuous innovation, and establishing a firm foothold in Sam.

Entering Sam's Club is both a challenge and an opportunity for suppliers to showcase their strength and create business value. Suppliers need to have strong competitiveness, including excellent product quality, stable supply capacity, outstanding brand influence, innovative display proposals, and customized packaging solutions for Sam. At the same time, suppliers also need to have a global perspective and collaborate with Sam's to jointly develop products that meet Sam's standards, in order to succeed in the fierce market competition.

Although this process is full of challenges, once successful, suppliers will be able to gain huge market returns and even have the opportunity to promote their products to the global market, achieving long-term business growth.