thoughts on EU distributor in reply to steverogers post below:
" Posted On: 02/26/2016 12:47:58 PM
Posted By: Steve Rogers
Re: Coujoe62 #3179
Question? How is this going to work? Will this top EU distributor act like CoreMark and Mccalne do in the US where if a retail shop learns of the product they can reach out to the distributor and have the product delivered? Because that isn't going to work in my opinion because the distributor doesn't have a vested interest as say the SMS dealers have. If the EU distributor will act like an SMS master dealer and sell franchise SMS dealers in EU then that sounds fantastic.
Any thoughts?"
i dont think it will matter the logistics/mechanics of distribution once the product hits the stores. the distributor/entity will be vested as they will most likely be buying the product up front due to differences in labeling/regulatory approvals. just as in Korea where the formulation and label is different - the company gets paid up front and the rest upon delivery. my assumption is any EU distributor will be similar due to there being different labeling requirements. if that is the case - the distributor is going to have a LOT more vested interest in moving this product (and/or making sure it is already spoken for) if they have to unload a container vs a pallet. that is what makes the international market more lucrative from a cash flow standpoint - essentially no terms.
if they do something similar to the SMS model in the US - they will either get all of the EU or will get a protected "territory" and be the primary seller. since their market is not near as distribution based as the US - I would assume HJOE would have a limited number of distributors/partner to cover the EU but that would depend on if they have multiple parties interested in the brands. i would also guess this is more recovery as i dont think LTCG is that prominent outside the US and Canada (i know a lot of Canadians and he is relatively popular up there). doesnt really matter as long as they are moving product.
while it is certainly positive -it will take awhile for this to develop. look how long it took them to move CK forward (2.5 years) and they are just now moving product again after 1-2 orders last year. they had several regulatory hurdles in Japan/Korea with certain ingredients (picamillion requires a prescription in Japan, Russia, and elsewhere). the EU can be rather arduous in the regulatory environment whether it is environment related or consumables. so - it could be end of 2016 or wellinto 2017 before they actually move product regardless of a signed deal/contract. still very positive news but the blown up hype pre SMS caused quite the negative reaction as the partner/path was not understood and VMB and others were pushing Glazers, Coke, etc.
i wont have time to research it until this weekend but for those with spare time/interest - i would look for companies that deal/seek emerging brands and work closely with individual retail outlets (as others mentioned). the cstore concept with 50-5000 locations doesnt really exist so a CoreMark type of entity would not really be a player (if others are more familiar with the market - feel free to correct. I know the industrial side - not convenience).
i went ahead and bought a couple hundred thousand at 15 and NITE immediately put up 1.5MM on teh ASK and where it currently sits. i still have BIDs in but they havent been touched as well as the others. with the announcements of new dealers and existing ones already taking reorders - i dont imagine the buyers will remain as patient. i think it will be an itneresting couple of weeks. they have another full training class in March and have announced a couple others. they should rapidly be approaching 50 dealers and may hit that by end of April. that would put them well ahead of their 100 dealer target by EOY 2016. right now - it is in the innovator/early adopter phase of the bell curve of the law of diffusion of innovation for the dealers.
if not familiar with the concept - take a look at this video. while i dont fully agree with the apple hype per se - it fits in with the talk. more importantly and specific to this thread is the how and why a company does things and how the market responds accordingly. while watching the video - think about HJOE and SM and their approach to the market (SMS, vending, etc). may give you a better idea why i and others are ardent supporters/investors in the company/brand.
https://www.ted.com/talks/simon_sinek_how_gre...anguage=en
give yourself time - video is 18 min long. while you can read the transcript - watching the video provides a lot more "depth" to the concepts. disclaimer - i am not a tedtalks fanatic. i have found some excellent topics and some that i thought were complete word soup, consultant BS. this one i think is pretty solid.
" Posted On: 02/26/2016 12:47:58 PM
Posted By: Steve Rogers
Re: Coujoe62 #3179
Question? How is this going to work? Will this top EU distributor act like CoreMark and Mccalne do in the US where if a retail shop learns of the product they can reach out to the distributor and have the product delivered? Because that isn't going to work in my opinion because the distributor doesn't have a vested interest as say the SMS dealers have. If the EU distributor will act like an SMS master dealer and sell franchise SMS dealers in EU then that sounds fantastic.
Any thoughts?"
i dont think it will matter the logistics/mechanics of distribution once the product hits the stores. the distributor/entity will be vested as they will most likely be buying the product up front due to differences in labeling/regulatory approvals. just as in Korea where the formulation and label is different - the company gets paid up front and the rest upon delivery. my assumption is any EU distributor will be similar due to there being different labeling requirements. if that is the case - the distributor is going to have a LOT more vested interest in moving this product (and/or making sure it is already spoken for) if they have to unload a container vs a pallet. that is what makes the international market more lucrative from a cash flow standpoint - essentially no terms.
if they do something similar to the SMS model in the US - they will either get all of the EU or will get a protected "territory" and be the primary seller. since their market is not near as distribution based as the US - I would assume HJOE would have a limited number of distributors/partner to cover the EU but that would depend on if they have multiple parties interested in the brands. i would also guess this is more recovery as i dont think LTCG is that prominent outside the US and Canada (i know a lot of Canadians and he is relatively popular up there). doesnt really matter as long as they are moving product.
while it is certainly positive -it will take awhile for this to develop. look how long it took them to move CK forward (2.5 years) and they are just now moving product again after 1-2 orders last year. they had several regulatory hurdles in Japan/Korea with certain ingredients (picamillion requires a prescription in Japan, Russia, and elsewhere). the EU can be rather arduous in the regulatory environment whether it is environment related or consumables. so - it could be end of 2016 or wellinto 2017 before they actually move product regardless of a signed deal/contract. still very positive news but the blown up hype pre SMS caused quite the negative reaction as the partner/path was not understood and VMB and others were pushing Glazers, Coke, etc.
i wont have time to research it until this weekend but for those with spare time/interest - i would look for companies that deal/seek emerging brands and work closely with individual retail outlets (as others mentioned). the cstore concept with 50-5000 locations doesnt really exist so a CoreMark type of entity would not really be a player (if others are more familiar with the market - feel free to correct. I know the industrial side - not convenience).
i went ahead and bought a couple hundred thousand at 15 and NITE immediately put up 1.5MM on teh ASK and where it currently sits. i still have BIDs in but they havent been touched as well as the others. with the announcements of new dealers and existing ones already taking reorders - i dont imagine the buyers will remain as patient. i think it will be an itneresting couple of weeks. they have another full training class in March and have announced a couple others. they should rapidly be approaching 50 dealers and may hit that by end of April. that would put them well ahead of their 100 dealer target by EOY 2016. right now - it is in the innovator/early adopter phase of the bell curve of the law of diffusion of innovation for the dealers.
if not familiar with the concept - take a look at this video. while i dont fully agree with the apple hype per se - it fits in with the talk. more importantly and specific to this thread is the how and why a company does things and how the market responds accordingly. while watching the video - think about HJOE and SM and their approach to the market (SMS, vending, etc). may give you a better idea why i and others are ardent supporters/investors in the company/brand.
https://www.ted.com/talks/simon_sinek_how_gre...anguage=en
give yourself time - video is 18 min long. while you can read the transcript - watching the video provides a lot more "depth" to the concepts. disclaimer - i am not a tedtalks fanatic. i have found some excellent topics and some that i thought were complete word soup, consultant BS. this one i think is pretty solid.
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