How can brands support shuttered independent retailers?

Discussion
Sources: Chaco Footwear; Vans; Mons Royale; Brooks Running
May 15, 2020
Tom Ryan

Brands in the active lifestyle space have been rolling out support programs to help their independent specialty store partners weather the COVID-19 storm.

The programs come in addition to any payment extensions or order cancellations. Many are only available as stores remain closed.

In many cases, independent retailers help generate leads to a brand’s own website and take a cut of resulting sales.

For instance, Rumpl, the Portland, OR-based technical blanket brand, is providing unique discount codes to individual stores that can be offered to customers for a 15 percent discount on Rumpl.com across the brand’s full online inventory. When customers enter a store-specific code upon checkout, Rumpl sends 30 percent of any sale directly to the retailer. 

Mountain Hardwear, Chaco Footwear, Garneau and EcoVessel have also introduced commission-type programs to support independents.

Other retail support programs are taking different approaches:

  • Osprey is encouraging customers who purchase qualifying backpacking styles on Osprey.com to visit their local participating retailers to receive a professional fit. Once the customer comes in, the retailer receives 15 percent of the pack’s purchase price as a credit on their Osprey account.
  • Vans is selling a special Vans Customs range online with all proceeds supporting local and community-driven skate shops, restaurants, art galleries and music venues.
  • Alta Cycling Group, the owner of the Diamondback and iZip bike brands, is offering bike shops free enrollment in Promoboxx, a digital communications platform designed to increase online awareness, engagement and help generate sales.
  • Toad&Co, the outdoor apparel brand, is sharing 10 percent of all new customer e-commerce revenue with independents. Allocation is based on sales territory.
  • Mons Royale, the New Zealand-based merino apparel company, is allowing customers at checkout on monsroyale.com to dedicate 25 percent of their purchases to a local Mons Royale retailer.
  • Brooks Running on an Instagram post said it will be covering any fees for curbside pickup or same-day delivery at a local store. The running brand is also encouraging Instagram fans to give five-star reviews to a nearby store and purchase gift certificates to use at later dates.

DISCUSSION QUESTIONS: What do you think of independent retailers earning a commission on sales directed to their brand partners’ websites? Are any of the other retail-support programs mentioned in the article likely keepers after the pandemic threat ends?

Please practice The RetailWire Golden Rule when submitting your comments.
Braintrust
"The more brands can do to bolster omnichannel retailing the better, and I agree this is a time when brands and retailers need to find new ways to work together."
"Brands should have been offering a portion of their sales to the indies giving customers a hands-on experience with their products ever since the advent of e-commerce."
"I applaud the effort from the brands to support their independent retail partners. A mutual support system between national brands and local retailers makes a lot of sense."

Join the Discussion!

13 Comments on "How can brands support shuttered independent retailers?"


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Bob Amster
BrainTrust

I have never been an advocate of DTC sales by brands that also wholesale to retailers. They are competing with the very channel that got them started on selling product in the first place. Therefore anything that brands can do to help the independents, during and post COVID-19, is a move in the right direction. Sharing commissions is but a small gesture.

Suresh Chaganti
BrainTrust

I hear you Bob, but it would be a strategic blunder for brands not to develop their own DTC channel. That would leave them vulnerable to the whims of retail partners, not to mention dependency on getting shopper insights. There has to be a healthy push/pull. Some of the angst can be alleviated by developing DTC-exclusive products.

Art Suriano
BrainTrust

It is nice to see how many businesses are working together to help one another during the COVID-19 pandemic. Brands supporting small independent retailers is another one of those kind gestures, and it makes sense. At some point, this will be behind us. No doubt many small independent retailers will not make it, and that’s unfortunate. However, the ones that can make it through this will do so much easier by having brands supporting them. Longer payment terms were a great start, but seeing the many brands helping small independent retailers by partnering with them with a way to share proceeds is outstanding. It’s not only generous; it’s smart. Anything a brand can do to help the little guy survive will prove to be a big win when this is all over. The independent retailer won’t forget and, most importantly, neither will their customers. Everyone will come out ahead, and I commend all the participating brands attempting to help the small independent retailer get through this.

Jeff Sward
BrainTrust

Turns out that when some brands talk about partnership, they actually mean partnership in the long term sense of the word. Now let’s see what new business models emerge out of this evolutionary thinking.

Bethany Allee
BrainTrust

Retail has only really started broadly exploring the importance of partnerships and indirect sales models over the past five to 10 years. Other industries understand and have been able to capitalize on the scalability and profitability of indirect sales models. These commission models are long-term viable and now is the time retailers should focus on their partner strategy.

Jeff Weidauer
BrainTrust

I applaud the effort from the brands to support their independent retail partners. A mutual support system between national brands and local retailers makes a lot of sense. It will be interesting to see if these programs continue and evolve once stores re-open.

Suresh Chaganti
BrainTrust

It would be in the interest of brands to prop up their retail partners. This is particularly true for brands that don’t have a very strong online channel of their own.

It comes down to the financial affordability of the brands, but there are other things that will help – manufacturers coupons, extended credit facility, offsetting inventory carrying costs, sponsoring local events, etc.

Rich Kizer
BrainTrust

I don’t know what posture these programs can assume after the pandemic threat ends. But this I know: these programs better make the retailer the hero.

Kathy Kimple
BrainTrust

The more brands can do to bolster omnichannel retailing the better, and I agree this is a time when brands and retailers need to find new ways to work together.

Ralph Jacobson
BrainTrust

Having started in the grocery biz in the ’70s, I can tell you that this struggle for effective collaboration, ensuring a true value exchange for both CPGs and retailers has been going on forever. COVID-19 has only highlighted this painful issue.

Yes these ideas are a great start. We need to get serious once and for all to get the relationship productive in the long term.

Jasmine Glasheen
BrainTrust

Brands should have been offering a portion of their sales to the indies giving customers a hands-on experience with their products ever since the advent of e-commerce. The same goes for commissioned store associates. Even before COVID, many customers were trying in-store and shopping online, so maybe brand kickbacks to store associates and independents will become a facet of the new retail normal as stores reopen and life resumes.

As consumers continue to demand transparency from brands post-COVID, offering mom-and-pops kickbacks could also be a smart PR move for brands that have struggled to remain relevant (and, let’s be honest, what brand hasn’t struggled in all of this)?

Jeff Sward
BrainTrust

Well said. The indies can be terrific showrooms for the brands. And that means it’s only appropriate that this new model be monetized in manner that works for all.

Ricardo Belmar
BrainTrust

Since the start of this pandemic, a popular phrase heard around the Internet and most advertising has been that we are “in this together.” Originally meant as a rallying cry for individuals and communities, why not for business partnerships that are so intertwined anyway? Just as retailers and their real estate landlords should be working together to get through this crisis, so should brands and their retail partners. How these partnerships continue in a post-pandemic world will probably depend on the numbers and how sales were impacted, but I think it’s safe to say brands will recognize that those independent retailers can really help improve the brands’ relationship with their customers when they choose to work together in a way that larger retailers won’t support.

wpDiscuz
Braintrust
"The more brands can do to bolster omnichannel retailing the better, and I agree this is a time when brands and retailers need to find new ways to work together."
"Brands should have been offering a portion of their sales to the indies giving customers a hands-on experience with their products ever since the advent of e-commerce."
"I applaud the effort from the brands to support their independent retail partners. A mutual support system between national brands and local retailers makes a lot of sense."

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