We’ve learned that getting products onto store shelves involves far more strategy than most people realize. Our first attempts at retail placement taught us some humbling lessons – showing up with samples and enthusiasm isn’t enough in this business.
We discovered a whole ecosystem of vendor applications, liability insurance requirements, margin expectations, and payment terms that govern these relationships. The retail gatekeeping system exists for good reason, protecting both stores and suppliers from potential pitfalls.
Once we mastered the unwritten rules of wholesale partnerships, doors started opening. Now we understand why some products make it while others don’t, and it has less to do with quality than with understanding the business mechanics that happen long before a customer ever sees our work.
Key Takeaway
- Retail selling means the store buys and owns your product before selling it to customers.
- Consignment selling lets the store sell your product without owning it, paying you only after a sale.
- Wholesale selling involves selling your product in bulk to stores who then resell it.
Retail Selling: When the Store Owns Your Product
We usually start with retail selling because it’s the most straightforward. We sell the product to a store, and they take it from there. They own it, price it, promote it. It’s off our hands. This kind of selling is what most people imagine when they picture a product on a shelf. The store buys it first. Then they try to sell it.
How Retail Selling Works
In retail selling, we hand over our product at a wholesale rate. That’s usually less than half of what the final customer might pay. The store adds their markup, and that difference is their profit margin. They’ve got skin in the game—if it doesn’t sell, they take the loss.
Once it’s in their hands, it’s not our inventory anymore. We don’t control where they place it, how they display it, or what discount they apply. That control—and that risk—belongs to the store now.
Retail Stocking and Merchandising
Still, we care how our product looks on the shelf. We might not control it, but we feel the effects. If it’s buried behind a row of older items, sales slump. If it’s front and center, we might see a spike. Merchandising matters.
Here’s what we look for:
- Eye-level shelf placement
- Clean, uncluttered displays
- Bold signage
- Grouping with complementary products
We often ask for product photos after stocking. Just so we can see. Not because we can demand changes (we usually can’t), but because we learn what works.
Retail Sales Agreement
Before anything hits the shelf, we sign a retail sales agreement. This outlines:
- Wholesale and retail pricing
- Delivery expectations
- Return policies
- Payment terms
We try to keep the terms simple. Payment within 30 days is common. Returns allowed for damaged goods, but not poor sales. We push for clarity—if we’re lucky, the agreement protects both sides equally.
Wholesale Selling: Bulk Sales to Retailers
Wholesale is kind of retail’s cousin. We sell in bigger quantities, sometimes to distributors rather than stores. We get paid up front, and usually, we don’t hear about what happens after.
Wholesale vs. Retail
The main difference is quantity and price:
- Wholesale: Bulk orders, low unit price, minimal interaction after delivery
- Retail: Individual sales, higher unit price, more involvement in product promotion
We give up margin for volume. It can be a better deal if we’re producing at scale. Less handling. Fewer clients to manage. Cleaner cash flow.
Wholesale Distribution Channels
In wholesale, we don’t always sell directly to stores. Sometimes we use middlemen:
- Distributors
- Brokers
- Buying groups
These partners widen our reach. We might get into a dozen stores without ever meeting a single store owner. But we also give up more control and more of the margin. There’s always a tradeoff.
Consignment Selling: Store Sells Your Product Without Owning It
Consignment’s a different beast. We loan our product to the store. They display it, try to sell it, and only pay us after a sale happens. If it doesn’t sell, we take it back.
How Consignment Works
We retain ownership until there’s a transaction. The store doesn’t pay up front. That reduces their risk, which helps us get our foot in the door. Especially if we’re new, unknown, or unproven.
But we carry more risk. Here’s why:
- No guaranteed payment
- Possible product damage
- Slow turnover
We often wait weeks (or months) to get paid. And if the store doesn’t report sales accurately? We’re stuck chasing numbers.
Example of Consignment
One time, We had a small batch of handmade goods. We couldn’t afford a big production run, and no store wanted to buy outright. So we offered consignment. We handled the display ourself, made sure tags were clear, and came by every two weeks to check stock.
Some stores were honest and sent payment promptly. Others needed reminders. One never paid at all. We stopped consigning there. But overall, it got us exposure we couldn’t afford otherwise.
Consignment Agreement
Always, always get it in writing. A consignment agreement should include:
- Percentage or fixed commission
- Payment schedule
- Responsibilities for display and loss
- Terms for returning unsold goods
Without it, disputes turn messy fast. The clearer the agreement, the smoother the relationship.
Retail Consignment vs. Sale or Return
Some folks use the term “sale or return.” It means the same thing in most places. Product goes in. Sale happens. Then payment. Otherwise, the product comes back. Ownership stays with us the whole time.
Drop-Shipping: Selling Without Inventory
This one’s exploded in recent years. Drop-shipping means the store sells, but we ship. They don’t handle the product, stock shelves, or pay up front—exactly the kind of setup Trendsi supports with over 100,000 fashion products and fast U.S. shipping for your brand.
How Drop-Shipping Differs
We’re both seller and shipper. The store markets the product, processes the sale, then passes the order to us. We fulfill it.
What makes it different:
- Store never owns inventory
- We handle packing, shipping, sometimes returns
- We get paid after each order, not upfront
It reduces overhead for the store. But we take on fulfillment logistics, shipping issues, and customer complaints. If a product arrives late or damaged, it’s on us—not them.
Retail Product Placement and Promotion
We might not always control where our product goes, but we can influence how it’s presented. Placement matters. So does promotion. We’ve seen a great product flop just because it was hidden.
Retail Product Marketing and Launch
When we launch, we usually support the store with materials:
- Posters
- Flyers
- Demo videos (on a loop if allowed)
Sometimes we negotiate a product launch weekend. That might mean:
- Discounted pricing
- Samples
- In-store appearances (depending on the category)
It helps customers recognize something new’s arrived. And it shows the store we’re invested in making the launch a success.
Retail Inventory Management
If we’re doing retail or wholesale, we don’t usually manage store inventory. But we still ask questions. We want to know:
- Sell-through rates
- Reorder frequency
- Dead stock buildup
It helps us plan production. It tells us what SKUs to push. It even influences our packaging—if a product isn’t selling because it doesn’t fit the shelf well, we change it.
Retail Product Agreements and Relationships
It’s all about relationships. Contracts, sure—but also trust. We’ve had stores reorder with no paperwork, just a text. Others needed 20-page vendor packets. It all depends.
Here’s what we’ve signed:
- Product sales agreements
- Consignment contracts
- Vendor setup forms
- Distribution partnership terms
Each one shapes the terms of engagement. Who owns what. Who pays for freight. Who’s liable for returns.
Practical Advice for Selling Your Product in Stores
How To Sell A Product – Sell Anything To Anyone With This Unusual Method
Credits: Dan Lok
From what we’ve learned, a few things make a big difference:
- Start small. Local stores are easier to work with than national chains.
- Choose the right model. Retail and wholesale bring faster payments. Consignment brings less resistance.
- Visit the store. See the layout. Imagine where your product could fit.
- Ask for feedback. Not everyone gives it, but when they do, it helps.
- Follow up. Don’t assume they’ll reorder unless you remind them.
- Put everything in writing. Always.
Additional Considerations in Retail Sales
Pricing Strategy and Gross Margin
If we price too high, stores say no. If we price too low, we lose profit. We aim for a margin that leaves room for the store to mark up at least 50%—sometimes more.
So if it costs us $10 to make, we might sell it for $20 wholesale. That way, the store can price it at $40 retail. It sounds steep, but that’s typical. Stores need to cover rent, labor, shrinkage, and profit.
Retail Buyer and Vendor Relationships
We keep it professional but personal. Store buyers don’t want constant messages, but they appreciate regular updates. A quick check-in every month or so helps. We ask what’s moving, what’s not, and what they’d like more of.
Buyers are busy. Respect their time. Be ready with info they might need: UPCs, case pack size, lead time.
Retail Supply Chain and Logistics
We keep fulfillment smooth. Late deliveries frustrate stores. Incorrect orders wreck relationships. That’s why we lean on platforms like Trendsi, which automate inventory sync and order accuracy across all channels. We use checklists:
- Label all boxes clearly
- Include packing slips
- Confirm ship dates
And we pad our timelines. If we say 5 days, we aim to ship in 3. Better early than late.
Retail Product Sales Channel Management
Once we’re in more than one store, we track each channel. We build a spreadsheet that includes:
- Store contact
- Agreement terms
- Sales history
- Product SKUs
It helps us spot patterns. Maybe one region likes our seasonal items more. Maybe a product’s moving in one shop and sitting in another. We adjust based on what we see.
FAQ
What is retail distribution?
Retail distribution happens when stores sell your products to customers. It’s the process of getting your items from your workshop or factory onto store shelves where shoppers can find and buy them.
What does wholesale mean?
Wholesale means selling your products in bulk to stores at a lower price than retail. The store then marks up the price when selling to customers, which is how they make money on your product.
What is consignment selling?
Consignment means a store displays and sells your products, but you still own them until they sell. The store takes a percentage of each sale and gives you the rest, only paying you after items sell.
What’s the difference between distributors and retailers?
Distributors buy your products in large quantities and sell them to multiple retailers. Retailers are the actual stores that sell directly to customers. Distributors work as middlemen in the sales chain.
What is dropshipping?
Dropshipping happens when a store sells your product but doesn’t keep inventory. When customers buy from the store, you ship products directly to them. The store handles marketing and customer service.
What are retail placement fees?
Retail placement fees are money you pay stores to stock your products. Sometimes called slotting fees, these charges secure shelf space for your items and can vary widely between stores.
What does “on commission” mean?
Selling on commission means stores earn a percentage of each sale of your product. Instead of buying inventory upfront, the store only makes money when your product sells, sharing the risk.
What is vendor-managed inventory?
Vendor-managed inventory means you control restocking your products in stores. You monitor inventory levels and decide when to send more products, giving you more control while saving the store work.
Conclusion
So what’s it called when a store sells our product? Depends. It could be retail, wholesale, consignment, or drop-shipping. Each model shifts risk, responsibility, and control. But they all share one thing: they put our product in front of real customers.
It’s not about picking the “best” model. It’s about finding what fits us, our product, and our goals. Whether it’s dropshipping, wholesale, or custom manufacturing, Trendsi gives fashion brands the flexibility to scale with confidence. We test, learn, and adapt. That’s what gets our product off the shelf and into someone’s hands.