Why Pre-booking Programs?

by Darin Dewberry, Pete Garcia Company | Garcia Group

Pre Order 105606370


Pre-book programs are valuable for both perishable and non-perishable suppliers. They are even more valuable now to wholesale distributors trying to grow both sides of the business. Here are a few thoughts as to why you should pursue pre-booking programs with your suppliers and your customers. 

Your Time is Valuable

Everyone is wearing multiple hats these days at all levels of the distribution chain. You are no longer just a buyer or just a seller, you are doing both. This requires more planning than ever and thus more of your time. Save yourself and your customer time and money by buying during the “buying season” and selling during the “selling season”. If you are able to buy early during the pre-book periods, you have time to plan how to market and sell the product before it arrives. 

Larger Variety of Options

Every supplier in the distribution channel is limited to the amount of inventory that they can carry. Even the largest suppliers in the chain have an inventory budget that is only so big. Also, everyone has their own personal tastes. Sometimes this can cloud the product mix to customers. What I think is “cool” isn’t necessarily what all of my customers think is “cool”. A pre-book program allows me to show more products without risking inventory dollars, and thus I can fill more of the needs of my customers. 

Manage Inventory Better

One of the original ideas for pre-booking was because customers found it hard to get popular items in the stores. Suppliers can better gauge how much to produce or buy prior to the first release. In addition, a pre-book program can help give a better idea of what product mix to keep in inventory for reorders from the marketplace after the product’s initial release. 

Help Increase Sales

In some cases it can block out your competition by removing the customer’s budget early. In addition, when the pre-book order is ready to ship, you now have another reason to contact the customer for possible additions. This additional contact can save you and your customer additional money on freight and processing charges. 

Excitement Among Team Members

Pre-book orders can help generate a buzz among salespeople. Even the most experienced salespeople like the “thrill of the sale”. This excitement is contagious and can motivate other salespeople. 

Cash Flow

Having committed when placing the order, the customer will usually complete the transaction shortly after the product's release.  

Save Money and Increase Margins

Many suppliers offer a variety of incentives for ordering early instead of waiting to commit until a specific shopping period, like the holiday season. Some of these incentives can include additional discounts, marketing allowances, dating terms, or freight programs. These pre-booking bonuses can be kept in house to increase margins, offset other expenses, or passed on to your customers to incentivize sales growth. 

Good luck and good selling!

Share your experiences with pre-booking programs below!

 

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1 Comment

Marla O'Dell on Friday 06/15/2018 at 11:31AM wrote:

Great points Darin! I will add another. Pre-booking season for the following year is generally right after the selling season for the current year. Yes, #s tell you what sold and what didn't (based on what you had to sell) at any time but there are also incidents fresh in your mind from the current selling season. For example, customers asked for xyz which we didn't have. That wouldn't show up in the #s of what you had to sell!

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