Is Your Product Too Dependent on Wal-Mart?

There are some common misconceptions amongst entrepreneurs and inventors about getting their products into Wal-Mart, Target, and other department stores.

Many believe that if they come up with a unique idea and find a manufacturer to mass produce, the rest is super simple. But really, that's where it starts to get complicated.

Getting your product into a department store is very difficult, as you'll have to first manage to get a sales rep to successfully pitch your product to them. Good honest sales reps are hard to come by, and can be quite expensive.

Next, you'll have to undergo a process where the department store inspects your product for quality, safety, and government compliance. This can take months, and they may come back and tell you to make changes to your product using different materials.

Then if they do decide to have your product sold in their stores, they'll place an order with you - but because they're buying in bulk, they're going to want a huge discount that will leave you with a very low profit margin. Plus, they won't pay you upfront, and you may have to wait several months to get your first payment from them. This may be a serious problem if you don't have enough cash flow in the beginning to fulfill the order.

But here's where it really gets complicated. If your product doesn't sell well, many of them like Wal-Mart will ship the products back to you - at your expense!

Can you imagine ordering 20,000 units at their request, and then they send 17,000 of them right back to you because of poor sales?

Dealing with department stores can be extremely challenging and risky. I've heard tons of horror stories. Even worse, you're one of thousands of vendors they do business with - so don't expect any special attention or sympathy.

Instead of being so dependent on department stores, my suggestion is to deal with smaller local retailers. Even better, invest your time and energy into your very own online store. Sell your own products, and store your own inventory. Even selling on eBay is a better option.

Not only will you keep more of the profits, but you'll also save yourself from a lot of unnecessary stress and frustration.