Why you should know Grocery Outlet

2-min read

If you’re launching a new product, you probably don’t have a strategy to get into discount retailers. Which makes sense – it’s never a brand’s goal to get into a discount store. But let’s face it, at one time or another, you are going to need to offload some inventory.

When you can’t sell anywhere else, the options are donation or Grocery Outlet. Let’s explore why Grocery Outlet might be a really good option.

Not the old Grocery Outlet

If you’re thinking dusty dented-can close out store, think again. Grocery outlet has undergone a makeover. They are now a full-service grocery store with all departments including deli and fresh meat. They’ve up’d their brand standards – how the store looks – and customer count is up 9% in Q2.

Customer Perception

Grocery Outlet is attracting influencer/foodies – people that like to be the first in their friend group to discover a new product, and high-income savvy shoppers – people who are looking for premium products on deal. For those audiences, Grocery Outlet offers an exciting treasure hunt experience in addition to pantry loading. Customers can expect to save between 40 – 70% on a basket of goods.

Why sell to Grocery Outlet

For premium brands, Grocery Outlet offers a way to convert slow-moving, de-listed or close-out inventory into cash while not hurting your reputation. Unlike TJMaxx, at Grocery Outlet your products have a home on the shelf with a dedicated facing.

More to know:

·      Store count is growing – just surpassed 450 stores in the West and East

·      Buyers try for 50% off your wholesale (depends on the item, how well they think it will move, and how close dated it is)

·      Opportunity to get on a Power Wall – entry display for Wow! deals (local operator decides who gets this, but it’s essentially an end cap at no cost)

·      The cash conversion cycle is sweet – net 30 on received goods and you get paid on time. They work on a dead net cost, no deductions, and no returns

·      There are no minimum shelf life requirements, but Grocery Outlet will never sell expired goods

·      They take as little as 40 cases, but your best bet is when you have 100 or more cases, to make shipping cost worthwhile

·      Logistics are easy and flexible – they pick up from all UNFI and KeHE warehouses; freight costs come out of COGS, or you can arrange to ship to them

Thanks to Allison Quantz, grocery buyer at Grocery Outlet for these insights. If you want to know more or have inventory that needs to move, contact Allison.

All my best,

Jennifer

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September 2023 YoY shopper data from Ibotta

As brands have relied on pricing strategies to fuel growth, declining volume and market share are now offsetting these efforts. Thus, it's imperative to focus on promotional strategies that accelerate incremental sales.