For the small kitchenware retailer, the costs of producing a catalog can make it an impossible proposition.
Enter HTI Buying Group. Founded five years ago by Bob Coviello, a 25-year kitchenware industry veteran, HTI in April printed its ninth syndicated kitchenware catalog.
Rochester, NH-based HTI brings together vendors and retailers to negotiate concession rates. To become a member of the buying group, merchandise vendors pay an annual fee of $800; retailers pay $700 a year. The 125 member vendors sell their merchandise to the member retailers at a 5%-20% discount. In return, member retailers purchase 65% of the product mix from the vendors for their stores.
The vendors’ merchandise is also featured in the syndicated catalog. The member retailers can buy a “share” of the catalog and receive personalized issues to mail to their customer base. Of the 28 member retailers, usually only half buy into the catalog.
Five retailers chosen by Coviello meet twice a year to view thousands of items submitted by the member vendors. They narrow the merchandise down to 400-450 items that appear in the 24-page biannual catalog.
HTI handles all of the catalog’s print, photography, design, and copywriting; the catalog costs member retailers $0.55-$0.65 a copy depending on how many copies they purchase. The average retailer buys 17,500 copies, Coviello says. The retailers need to have annual sales of at least $750,000 and be able to buy and stock the product mix from the catalog in their store.
If a purchase is made through the catalog, the order is fulfilled through the store that distributed the book. The retailers are responsible for their own catalog distribution; in addition to mailing to their customers, many insert the catalog into local newspapers.
Madison, WI-based retailer Orange Tree Imports has been participating in HTI’s catalog program since April 2000. “The retail industry is not getting any easier, especially for independent retailers. The catalog has helped us to comfortably hold our own,” says Orange Tree co-owner Dean Schroeder. His store usually sees a huge increase in sales of items featured in the catalog.
Fargo, ND-based Creative Kitchen first participated in HTI’s catalog program with the issue that mailed this past October. Creative Kitchen mailed 15,000 copies of that fall-winter issue and has purchased 22,000 copies of the spring-summer edition, which was mailed to retailers for distribution in April. “The catalog gives us the opportunity to show off a lot more of our products than a five- or six-page insert,” says Karen Skalicky, merchandise buyer for Creative Kitchen. “Our customers have responded very positively.”
HTI produced 200,000 copies of the spring-summer issue, and Coviello predicts that the fall issue will reach 250,000 copies. For his next initiative, Coviello is talking to vendors about creating a wholesale catalog to help them market to retailers.