Creating a supplement brand and essentially a company from scratch in the majority of cases, can be an incredibly daunting task. Coming from someone who has been there; I wish I could be told the things I knew now. We started off in retail ourselves and have now created this 12 step guide full of pointers and important lessons for the journey ahead of you. I promise you, if you take note of everything in this guide, you could save yourself some serious time and more importantly, hard earned cash; decisions at certain stages can ever so easily lead to the make or break of your supplement business.
Choose a Niche and a Target Market
People so often get carried away with huge plans of how they are going to sell thousands of units with there great quirky brand name. First things first, you need to identify what you are selling and who you’re selling to. If you answer this question, you can then create strategic plans around these answers. The idea may just spring to your mind, but more often than not it will involve research, a lot of research. I can’t stress how important it is to validate any ideas you have with backing through research. Does the market exist? Is there space for smaller fish to emerge? Is it big enough? Is it too competitive? Can I separate myself from others to stand out?
If you want to go and release a range of whey protein on a small budget and you are no different to Bulk Powders or MyProtein, who have marketing money coming out of their ears; I can tell you now, your going to struggle.
In our own example, we started by selling nootropics; a range of supplements to improve cognitive health. We identified that we would be selling to young professionals and students, as well as a possible older market that were aiming to reduce the effects of cognitive decline. We would also then add fringe products to improve overall health so as to keep our target market focused but not limiting.
Where Will You Sell?
You must identify where you are going to sell your product. Are you selling in a shop? Online? Amazon? Ebay? Or all of the above? Where you sell your product will have a huge impact on your overall strategy and product selection.
Lets use Amazon as an example. By the way, if you are not selling on here you are definitely missing a trick; it is the largest ecommerce platform in the world and has over 300 million active customers. Now, if you plan to sell solely on Amazon you must conduct research appropriate to this marketplace. You can use tools such as JungleScout to determine levels of demand for certain products. You will also be able to determine the landscape by analysing the amount of competition and reviews that you will be facing. All of this will tie into your product selection, marketing plan and customer acquisition further down the line. Research at this stage is so important, for more information I suggest you take a look at our blog – Selling Supplements on Amazon, it is an invaluable piece of content, telling you exactly what to look out for.
Looking at another example if you plan to sell on Ebay or your own online store, you will need to think about how you are going to fulfill orders. Unlike Amazon, Ebay does not offer a fulfillment service; so all of these things are important to work out before making the initial steps to choosing a product.
Choose Your Core Products
Once you have identified the niche, the kind of customer that you are going to target and where you are going to sell, you can then begin to focus in more detail on the exact product that you plan on bringing to market. Begin by researching the products surrounding your niche. Which are the most popular? You can get a gauge of this by trawling forums, looking on Amazon bestsellers, using software and looking at the reviews on popular websites that are already selling these particular products. I would then suggest creating a shortlist of 5-8 products, as some of these could well be written off further down the line; due to factors such as competition, margin or feasibility.
Assuming that you are a brand new company with limited funds (less than £10k), I would suggest that you always start small, with no more than three core products; each being heavily focused around your chosen niche. As you progress you can begin to add to your range and create fringe products to widen your target market; however this comes much further down the line, when your business becomes self sustainable. To reiterate, I would advise starting small in every way possible. Always go for the MOQ. Although this may increase unit cost, this reduces outlay and allows the opportunity to test the market’s reaction to your product.
Choose a Brand Name
This can come at any point in the process, but if you have got this far and you are still unsure, then start thinking. Two of the biggest tips I have here are:
- Keep it simple – Too much work goes into people being far too clever with brand names and they fall completely off the mark.
- Keep it relevant – Align it with your chosen niche. If I look back to our own retail brand of cognitive supplements, it would be no good if I came up with the name ‘Vitz 4 Kidz’. You must be able to have your target market relate to your products, as soon as they hear the brand name. This will have a lasting effect on your marketing, customer acquisition and repeat customers.
Another tip, don’t try and think too hard, it tends to have the opposite effect. Let it come naturally over a little time.
Create Your Legal Entity
By now it is about time to register your company with HMRC. Similarly to creating your brand name, this can be done at many different stages. I have put it here, as by this time you may well need it to unlock some doors.
Some selling platforms require proof of a company name and address in order for you to list your products. Suppliers will also take you more seriously if you have these.
Design Your Product
This is where it starts to get fun. The first step is to formulate your product(s), so that you are then ready to gather quotes from suppliers. When doing this it is important that you refer back to your research on competitors. How can you tweak or improve the product formulation? This could be increasing the dose, changing to an extract, removing fillers, adding black pepper extract for absorption. It could be a whole host of things. It is very important that you have an accurate formula, as this will put you in much better stead when speaking to suppliers.
You can then begin to design your logo and label design template, whilst also thinking about packaging. Again, throughout this process, think about how you can stand out from the competition.
Find Suppliers & Develop Relationships
By now you should have a very good idea of the products that you want to sell. If you have followed the steps then you should have 5-8 products with exact formulations and packaging requirements. If you come armed with all this information, suppliers will be much more likely to take you seriously. Being both a retailer and supplier myself, there is nothing worse than when a customer sends an enquiry saying that they ‘want a magnesium supplement’, with no reference to the form of magnesium, the mg, the capsule count, the packaging. Most suppliers won’t waste their time on these kinds of enquiries – Come prepared.
I would suggest sending out enquiries to 5-6 different suppliers; it’s unlikely that all of them will reply, but this should give you a few to compare against. It is easy to say don’t always go with price, but when starting out this is a huge factor. Nonetheless, do also look at factors such as communication, lead times, how helpful they are and how flexible they can be with things such as MOQ’s and components. All of these are also very important.
Once you are happy and have found your preferred supplier, stick with them and really try and develop a relationship. A good relationship with a supplier will take time to build, but is worth its weight in gold. Make sure to not spam them with questions; be wary and considerate of their time.
Place Your Initial Order(s)
By now you should have whittled it down to a few products that really fit your criteria in terms of margin, demand and competition. As soon as you are happy, place an order. There is a fine line between making sure you are comfortable and that everything is perfect and being seen as a ‘tyre kicker’. Placing your initial order is a huge step and means a lot in developing a relationship with your supplier. Before this point you are just like any other enquiry that they receive on a daily basis. You are now a customer.
Suppliers love no nonsense and will respond well to this. The less time you take of theirs unnecessarily, the more you will be rewarded with better terms, pricing and helpfulness – Trust me. For more information on the do’s and don’ts in supplier relations, check out our blog laying down all the facts.
At this point you will need to put the finishing touches to your label design, now that you know exactly which products you will be ordering. If you get stuck we have a fantastic regulatory label checking service, that will be more than happy to help.
Devise a Unique Marketing & Customer Acquisition Plan
At this stage you should look back to your research and decision of where you are going to sell. Dependant on these answers you must then begin to think about how are you going to sell? How are you going to get customers through the door? How are you going to get them back?
If we take the example of Amazon again, you will have to create a launch plan. Will you use PPC? FB Ads? Codes? You should also be utilising every sale by creating follow ups to gain reviews. It is never as simple as ‘Just put it up there and it will sell’.
If we take the example of your own online store, you will need to identify how you are going to get traffic to your store. Google Ads? FB Ads? Influencers? You should also be thinking about how you are going to collect emails and really utilise that acquisition cost, forcing reorders through great offers and customer service.
The more detail and planning at this stage, the more chance you have of setting yourself up for success. This is not a job that is done in a few hours and once again it involves . . . you’ve got it – a lot of Research. Most suppliers will take somewhere in the region of 7-8 weeks for custom orders. Use this time wisely to really dig deep into exactly how you are going to make this a success.
This is also a great time to build your own store and social media accounts, if that is part of your plan.
Sell Your Product & Build Your Brand
The day has come, your order, or orders are finally ready and being released by your supplier. It is now time to put your action plan into place. The most important things here are to stay patient and motivated. Some things will work, others won’t. This whole game is about testing and Rome was not built in a day.
One of the most important things that people forget when trying to build a brand, is the aftercare, or lack of. Just because you are selling well, customer care should not stop once that unit is out the door. The way to build a brand is to build a following. One great way to build a following is to go above and beyond in customer care. Don’t be afraid to give out a freebie if someone posts something nice about your brand. Things like this will massively help you in the long run. The more positivity that you put in, the more you will get back.
Building a brand is all about creating a community that people want to be a part of. You should be thinking about this in every piece of content you post and every message to a customer that you send. If you want to build something that lasts, you must create content over all social media platforms, relevant to your audience. In this day and age if you don’t have social media accounts, you’re going to struggle.
Reordering Your Supplements
In running an Amazon Selling Agency, as well as supplying many first time Amazon sellers, one of the biggest mistakes I see is poor budgeting. It is crucial that if you have a £10k budget you don’t spend £9k of it on 3 or 4 different products.
When starting a business one of the best ways to get going, certainly on Amazon, is to discount. This, along with a lengthy period to initially release your cash from Amazon, topped with a 7 week lead time from your supplier, can mean disaster when it comes to reordering.
Your product may be doing fantastic and you may need to reorder within 3 or 4 weeks time, but realise you only have £2k in the bank. This is where people either have to find more money or completely lose momentum and go out of stock.
I would always recommend spending no more than 70% of your budget on stock and always keeping a minimum of 20% of your budget in the bank so that you only need to add to it, in order to replenish your stock.
Cash flow is 100,000% the most difficult hurdle you will likely have to overcome. It is something we struggled with massively when starting out. Unfortunately your own success can quickly become your own worst enemy in so many cases.
Don’t Get Romantic
Final lesson and another great bit of advice. Don’t get romantic with products, learn to let go. If something is underperforming and you have genuinely tried everything in order to get it to sell, then you may have to kill it. Some of the best financial decisions we have ever made have come from culling or killing underperformers. You have to put aside the thoughts about the time spent on developing these products, that you were certain would do amazing. If you look at everything objectively and add a hint of ruthlessness, it can do wonders for cash flow and overall margin when you decide not to reorder.
Just remember this whole game is about creativity, research and testing. It is a marathon not a sprint.
If you would like anymore tips or advice on starting your own supplement brand, I’d be more than happy to help. You can email me directly at firstname.lastname@example.org.