Increasing profits with novelty and humor products
Did you hear the one about the party store that decided to forego humor and novelty items and missed out on an opportunity to increase profits? Not so funny, huh?
Party stores are all about celebration and fun, but selecting the right products at the right price for customers is serious business. Novelties come in a wide-range of prices and are an effective way to boost sales and ensure fewer shoppers leave your store empty-handed.
By nature, novelties are impulse purchases. "They're definitely an add-on," said Jack Steinfeld, president of ESCO Import Toys, a Texas-based toy and novelty wholesale company. "Customers won't go into a store just to buy a whoopee cushion."
Steinfeld believes there's room for novelty and humor items in all types of party stores. Even boutique shops can profit from adding novelty and humor items, as long as they're carefully selected. Steinfeld suggests letting the packaging be your guide.
To maintain an upscale feel, he recommends purchasing higher-end novelties in attractive packaging and taking time to consider your customer base and what items are right for your particular business.
"Our line focuses on steady items that are popular year in and year out," he said. Merchandise that can be sold throughout the year and also incorporated into holiday themes is not only cost-effective, it eliminates the problem of leftover holiday items that have to be stored or sold at a discount. For instance, items like rubber snakes, bugs and spiders are year-round big sellers that also work well for Halloween.
The Spice of Life
Although blue mouth gum, fake dice and screaming toilet seats are a staple at Del's Novelty and Party Supply Company in Morristown, N.J., owner Phil DelGiudice says the family business has evolved since its 1949 debut. In addition to the retail and wholesale novelties the company was built-on, they now carry a large inventory of costumes, and Halloween has become their biggest season.
"It would be difficult to go into the novelty business today," DelGiudice said. "To make a profit, you have to sell a lot of items that retail for a nickel or a quarter." While building a business based exclusively on novelties might be risky, he acknowledged novelties do make great add-ons for general party stores and recommends allocating a space for middle-of-the-road to low end novelties.
"This kind of item appeals to moms looking for party bag fillers and is also a magnet for young kids," he said.
Bill Hardgrove, owner of Akron Novelty and Merchandise Company in Ohio, said that after 50 years in the wholesale novelty business, the biggest mistake he sees retailers make is getting too narrow in their selection of novelties. He suggests storeowners put personal preferences aside and instead focus on their customer base. "Buy a wide-variety of novelty merchandise, don't lock into a particular area," he said. "Always remember to look for items that will appeal to the majority of customers."
And don't be afraid to make customers laugh. Party stores are most successful in selling humor and novelty products when they offer a large selection, as the consumer wants to choose.
Toy Talk and Sweet Spots
Bulk toys, like farm animals or bouncy balls, are great for children's parties. They typically come in boxes of 48 and can be sold individually or used as fillers for party bags. Toy novelties sell best when grouped together and most can be displayed and sold right out of the box.
"Girls tend to outgrow toys much quicker than boys," Steinfeld said. "For that reason, toys for boys are easier to find. There's a shorter window for girls. They hit 12 and they're no longer interested in toys, while boys will play with certain toys until about age 14."
Candy is a natural addition to party stores, said Terry Keenan, owner of Candy Concepts, Inc. It's available in a wide price range, but Keenan advises stocking a variety of lower priced candy as most party store buyers are not high-end and rely heavily on impulse sales.
"Individually wrapped candy works best because it's easily stored and doesn't require expensive display containers," Keenan said. "Wrapped novelty candies like Pixie Stix and Fun Dip are all the rage."
When incorporating candy into a party store, start with an assortment of at least 15 to 20 items and keep an eye on freshness dates, said Mike Bert of A & D Wholesale candy distributors.
"Candy should be kept in a separate section where you can control it, rotate it and manage variety," he said. "I also recommend starting with a four-foot section. If you go any smaller than that, no one will deliver it."
For the most part, Keenan believes party stores do best with products kids know, but he says there's nothing wrong with handling a small selection of nostalgia candy. Adults look for nostalgia products and may purchase it for kids.
Bins, Buckets, Racks and Stacks
No matter which novelties and candies are sold, how they're presented could mean the difference between success and failure.
"Display is to retail sales what location is to real estate," said Keenan, who notes his business was built on the 30 bucket spinning rack. While selling candy to party stores, customers showed so much interest in the spinning rack system, he added it to his sales. Now Candy Concepts, Inc. is approximately 90 percent display materials and 10 percent candy.
He suggests filling a single spinning rack with same-priced items to avoid confusion. That way, customers can fill a bag with an assortment of candies without having to track individual prices. Offering quantity discounts or pricing candy in groups of 10 or 25 also adds convenience.
"With wrapped bulk candy, you don't need expensive displays or large spaces," Keenan said. "Pick the least expensive method of display for the best selling product."
Popular candies like ring pops, push pops and bottle caps come individually wrapped, and can even be sold straight out of the box. Both products are often packaged in brightly designed boxes that provide instant display appeal and can be sold off of a tabletop. The two products do well in close proximity to one another.
"Displaying candy on one table with a second table for actual novelties is usually a successful, low-cost approach," he said.
Many basic magic tricks and novelties are individually packaged and designed for hanging. Most novelties that come in individual packages are rackable, and DelGiudice suggests placing items you want to promote on the counter by the register and opening a few packages to use as "try me" articles. The rest can be positioned on a nearby hanging rack.
Keep displays neat and colorful to entice shoppers to fill their bags, and remember to watch customer response to items and track which ones are best sellers. Replenish popular stock items, but don't forget to add new items occasionally, too.
Novelties can enhance sales, increase profit and add an element of fun for customers. And that's definitely something to smile about.
By Nita Crighton
Special to Party & Paper Retailer