RetailWire panelists recently discussed Walmart’s monthly practice of holding “open call” sessions where untested vendors (mostly “made in the U.S.A.”) can pitch their goods to the giant retailer’s merchants. The question is whether those usually small companies are really prepared to deal with the challenges of doing business the Walmart Way:
If I’m not mistaken, some variation on this “open audition” idea has taken place for years at Walmart. (Fellow panelists: If you know better, feel free to correct me!) The company’s push for “Made in the U.S.A.” products has probably given this process more visibility.
As David Biernbaum points out, many of the entrepreneurs invited to the “open call” probably find themselves ill-equipped to make a successful pitch — or they are so tempted by the game-changing size of an order from Walmart that they fail to do the math. It’s very tempting to ship the goods without understanding whether you can make money at the costs Walmart requires, including the costs of logistics.
Given the size of the “open call” business (compared to Walmart’s penetration of private and national brands), and the likelihood that these products will fight for shelf space in overcrowded stores, this program looks more like a feel-good effort rather than a game-changer.