“Newness” has been a buzzword throughout 2024, and as the industry prepares to enter the second half, specialty retailers are faced with ongoing challenges such as competing with big boxes, the ever-growing hurdle that is online sales (especially now that more major manufacturers are leveraging direct-to-consumer sites), and curating a wide assortment of fresh, new products.
Independent retailers are ready for an aggressive summer, with events and promotions to drive foot traffic and sales. Sources say many specialty retailers are shifting away from major manufacturers and common SKUs, and re-focusing on small or mid-tier brands with new products that are not yet available on digital channels. They can remain competitive with a differentiated assortment relative to mass and online retailers, and possess an edge if they can get those items to market quickly.
Another factor playing a major role in transforming the retail landscape is Faire, a free online wholesale marketplace where hundreds of thousands of retailers across North America and Europe are connected with more than 100,000 brands of all different sizes.
“Any tool that allows brands and retailers to streamline their operations is incredibly valuable for small business owners, who are often strapped for time,” explains Jen Burke, Head of Revenue at Faire. “It allows them to focus on what they do best — creating unique products or curating unique merchandise for their customers.”
Faire launched in 2017 with a vision to help small businesses come together to compete on a more level playing field. Now, the platform is home to thousands of items spanning Home Decor, Paper & Novelty, Beauty & Wellness, Pets, Kids & Baby, and more. While retailers buying inventory through a digital third party may seem like the Wild West, industry members tout the benefits of embracing technology disruptors and incorporating them into their business models.
FAIRE PLAYS FAIR
For retailers, especially those in rural or remote areas out of reach for rep groups, sourcing via offline channels can be time-consuming and costly. Sourcing inventory online can help save costs and give retailers access to a broader range of unique products from global brands. Faire even uses machine-learning algorithms that help recommend which products will sell well in stores based on users’ previous purchases, search history, and sell-through data.
For brands, bringing their wholesale business online through a platform like Faire allows them to get discovered by retailers, many of whom they would never have access to otherwise. It also allows them to grow their businesses while mitigating risk, as Faire guarantees payments on every order and manages collections from retailers. They also benefit from access to platform data on important metrics like best sellers. Faire’s biannual virtual trade show, Faire Market, offers retailers and brand owners who could not otherwise afford to travel, an opportunity to attend.
Faire attempts to create a level playing field based on brand reputation through strong review history and quality of transactions to prevent larger brands from hindering the discovery of smaller brands with heavy SEO spend and marketing. Doing so allows smaller brands to stand out for their outstanding customer service and offerings. In addition, when brands reach milestones like high retailer ratings and prompt order fulfillment, they can qualify for a Top Shop badge, which signals to retailers that they are a top-rated, reliable, and trusted brand. It also enhances their visibility in search results and category pages.
THE VALUE OF REP GROUPS
While manufacturers on Faire can block regions where they already have rep groups, it may seem that rep groups have to prove their value to retailers again. According to Liesl Ludwig, CEO of Anne McGilvray & Co., it’s important to consider the blend of traditional business values with modern entrepreneurial spirit.
“Rep groups bridge the gap between brands and retailers by providing a personalized touch that can’t be replicated by digital platforms,” she says. “The personal touch can manifest in various forms, such as the ability to provide samples and immersive showrooms, allowing retailers to fully experience a product before committing to it. This tactile element is often lost in digital transactions.”
In an age where transactions and interactions are becoming more automated and less personal, Anne McGilvray & Co.’s approach offers a competitive edge by cultivating strong, lasting relationships based on trust and personal engagement. Ludwig’s perspective blends respect for the legacy along with a vision for the future. “I believe it is not just about adapting to digital transformation but enhancing it with the human element that rep groups embody.”
Rep groups bridge the gap between brands and retailers by providing a personalized touch that can’t be replicated by digital platforms.
In Ludwig’s experience, platforms like Faire are helpful for new entrants in the retail sector, offering visibility and accessibility they might not otherwise have and potentially increasing their market share in the initial stages of business development. Faire serves as a springboard for retailers looking to identify their genre and narrative within the retail world. However, once a retailer has established their brand story and understands their customer base, the role of a sales rep becomes crucial.
“Reps have the local knowledge and connections that can deepen a retailer’s engagement with their community. They can curate a selection of toys that resonate with local trends, events, and cultural preferences, which a platform like Faire, with its broader approach, might not be able to do as effectively,” she says. “The coexistence of both digital platforms and traditional reps provides a strategy for success in the toy space. Digital platforms offer breadth, while reps offer depth.”
Toysmith, a toy and gift manufacturer and distributor for more than 40 years, has seen success with more than 14,000 retailers through Faire since joining three years ago. The company deploys a hybrid approach to reach retailers through multiple channels: a combination of reps, its field team, and Faire. This model ensures customers’ wants and needs are being met exactly when, where, and how they prefer.
“It’s a matter of asking a customer how they want to be touched and ensuring that they have a mechanism to be touched that way,” says Max Wunderle, Chief Commercial Officer, Toysmith. “Our use of Faire and in-person service provides an opportunity for customers to be serviced on their terms. Whether via an automated avenue like Faire or our own B2B portal, Toysmith is committed to being as accessible and user-friendly as possible. We augment that access with in-person service for those customers looking for a more personal, intimate relationship.
MAINTAINING A BALANCE
Richard “The Toy Man” Derr, Owner of Learning Express Toys in Lake Zurich, Illinois, has been using Faire since 2021. The retailer also purchases from several other platforms including reps, Amazon, manufacturer portals, trade shows, and rep portals, citing Faire as a great way to discover and search for new and trending products and categories. With 60-day interest-free terms, free returns on opening orders, and other perks, retailers can offer families relevant products and keep up with social media trends, essentially testing the waters in a low-risk way.
On the other hand, Derr has worked with reps for 28 years — since the store’s opening — and recognizes the extra effort they make to help curate the selection and protect the area from saturation. “In our industry, just as we — the indie retailer — promote hands-on, demos, and touch and feel to our customers, so too do the really good reps with sampling, stopping by to show us new items, and hosting events,” he says. “The reps who add value by listening to what a retailer values the most and then delivering that value are frankly ‘invaluable.’ I have one rep I’ve known for all my 28 years!”
With a younger generation of retailers entering the toy industry, there’s likely to be a fresh perspective that combines innovative digital strategies with authentic, personal experiences.
“As a second-generation sales agency, we embrace the synergy between rep agencies and digital platforms,” Ludwig says. “This combination is the future of retail — blending the efficiency and reach of digital with the nuanced, personalized service that reps provide. We see these tools not as competitors, but as complementary forces. Rep agencies can bring the warmth of human relationships and an understanding of local markets, while digital platforms can offer vast selection and convenience. Together, they enable us to deliver exceptional value to retailers and brands.”
A version of this feature was originally published in The Toy Book’s 2024 Specialty Toys & Gifts Issue. Click here to read the full issue! Want to receive The Toy Book in print? Click here for subscription options!
