Learn to launch your Energy Drink Company and make money selling it

Published: 06th July 2008
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Are Energy Drinks Growing at the same rate as they did 5 years ago or 3 years ago? No, they are not. They are still growing fantastically but not as much as they did back then. The stakes are now high, more companies are acquired, and more entrepreneurs are getting the funding and then the big pay day of an acquisition. So sales are vicious at the convenience store level. More Energy Drinks are competing for the same space on the shelve or refrigerator, and the big boys like Coca Cola, Pepsi, Rockstar, Monster and Redbul are fighting back and getting for shelf space of their own.



Of the 500 contacts I get every single month most of them are from people wanting to start an energy drink. I get calls from distributors looking for them from manufacturers trying to sell them and from entrepreneurs looking to start their own brand.



All the suppliers are tired of people calling them all the time and not doing anything so now they charge to talk; they require higher production minimums and sometimes even a retainer to get started. Production prices are a bit higher now and distributors; well they are saturated with calls from people trying to sell them energy drinks.



What can you do to compete? What can you do to get more energy drink sales? Easy, the answer is support. If you have better support you'll have more sales.



So what kind of support do you need to get the best distributors and the best retailers to carry your product? You need two basic things, you need Bodies and you need Deals.



Your Bodies are people on the ground, opening accounts for your distributors and helping retailers sell products. Your bodies will visit accounts, open accounts, merchandise, place racks, point of sale material and sell. Your deals are what you give your retailers on the spot for taking your product. It can be a special price, it can be a refrigerator, sampling event, something. Just remember this, nobody cars if you have the best looking best tasting product. They care how much you'll sell for them.



The Energy Drink Business is still a great business to get into; more than 300 new Energy Drinks hit the US market last year. If you plan on going into this business do your research first. Focus your research on sales, marketing and distribution. Yes, positioning is a lot of fun, promotion and formulation are fun also, but getting money in the bank from sales is even more fun. You are not getting any money unless you make a lot of calls and sell a lot of product. So focus your research on sales and distribution.



Promotions are a large part of Energy Drinks and it makes them very exciting. You have parties, club events, games, sponsorships, fun, fun and more fun. Now, the real question here is How much will you get for your promotions? Notice I don't ask how much you'll spend in promotions but how much you'll get back. Please, please don't spend a dime without a plan to get it back in sales.



Once everyone in your town finds out you have an Energy Drink you'll be the most popular game in town. You'll get calls from newspapers, magazines, and especially radio stations, all looking for advertising. Not to mention all the requests for sponsorship you'll get. What to do? In a best case scenario you will know exaccly how much you should make before you spend a dime in advertising and marketing. Don't spend anything without distribution; please save your money until you know yourROI on the cash you will invest.



Don't fall into the Energy Drink Promotion Trap. You always have to remember that you do not spend marketing money without having retail placement in place. You do promotion to get the product on the shelves or because you already have product on the shelves. Use promotions as "The Deal"; giving sampling or other events to your distributors or retailers when they buy into your drink.





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Start your own beverage business by reading Jorge Olson's latest book or visit the beverage industry website to get consulting on bottling, development, sales and distribution.

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