Musings
from Dennis #57: Peacemakers! Sometimes licensors become the go-between to make
amends between retailers and licensee wholesale suppliers. My colleague and I
once had to make a trip to KL to resolve an issue which was franchise driven
but predicated on this retailer buying in the brand. We knew that distributing
our apparel for this franchise in this banner would cover many doors, reach our
right target consumers and help drive our aggressive growth forecasts. But we
found out that there was no availability to open an account and list our brand
in the store. Helpfully the retailer suggested that we prove our brand’s worth
by participating in a short term members’ discount day. The licensee agreed but
to our dismay they changed their mind because the retailer was asking for a
hefty price off and the licensee decided it was too much to bear in terms of
the trading margin. Here we are at the buyers’ room sitting with both of them
on either side of us. I found out that day that asking the right questions would
get us to where we want to go.
“So is it
correct that this retailer is asking for all that discount from you?”
Yes they
are.
“Dear
retailer is the right understanding as well?”
Correct.
“Dear
retailer are you asking for everything from the licensee to be on discount at
70%?”
No I did
not.
By now,
eyebrows were raised and eyes lifted.
“So let’s
say if just one SKU goes at 70% and in very limited quantities, would you
accept this offer and bring in our licensee?”
Yes I
would!
“Licensee,
if this is the case are you prepared to come in but sell the rest of your items
at the normal price-off discount?”
Yes I don’t
mind, I thought they are demanding that my entire stock has to go 70% down.
To which
the reply from across the table “I never said “everything”. I just needed one
or two incentives to draw customers to your displays and create a sale demand
for us both”. (heard of the acronym ASS-UME?)
That day Cinderella, Ariel and their bevy of fellow Princesses found a new home.. and they all lived happily ever after.