UNDERSTANDING IS CALLED KEY TO VENDOR-RETAILER PARTNERING

JOHN KAROLEFSKI

NEW ORLEANS -- Want a trade partner? First, vendors and retailers must take the time to understand each other's business, according to Rex Miller, president of the School and Home Office Products Association. Then real partnering can take place.

"The single most important issue in the partnership that exists between these two players has to do with each fully understanding the pressures and constraints that exist for both," he said, "and how they can facilitate a win-win relationship by ensuring that both reach their objectives, ultimately serving the consumer."

Miller made these remarks as part of his opening day address here at the SHOPA annual convention. "New sales opportunities" remain the key to growth, Miller said. "That means the manufacturers must devote time, effort and money to create new products and new merchandising programs that consumers will desire to spend their money to obtain," he said. These new products can be one of three types: those that fill a real need, those that offer nothing new but a sales price below that of comparable existing items, or those that might offer an improvement in the "perceived value-benefit-reward relationship" important to today's consumer, according to Miller. "In a true partnership alliance, the manufacturers must help the buyer determine what existing items presently stocked will be impacted by the new products," he said, "and which of these newcomers will actually help the buyer realize more sales and profit from the space devoted to the category.

"In other words, the manufacturers have an important role to play in helping their retail partners in managing the retail mix to maximize the return on inventory investment," he said. Another key to growth, he added, is to have products on the retail shelves when the consumer wants to buy them. In a true partnership, retailers can count on manufacturers shipping the goods on a timely basis without errors and back orders.

Miller said that retailers must accept some of the responsibility to make this happen.

"Retailers must understand that orders -- especially for back-to-school with its narrow shipping window -- must be placed on a timely basis without unreasonable delay," he said. "When retailers will not commit until the last possible minute, or make drastic changes at the eleventh hour, manufacturers cannot be expected to deliver at peak efficiency.

"This lack of partnering by retailers," he said, "results in delayed or partial shipments and retail out-of-stocks. That adds up to lost sales opportunities that can never be recaptured, and that hurts the entire industry." On the other hand, he said, working together with a firm commitment to alliance partnering will grow the industry.