Shane Nelson launched SLS Specialty as a distribution company based on the expressed needs of his former clientele as an independent rep for SideLine Sales, which was formed a decade ago.
“I was an independent rep, representing a lot of independent manufactures, greeting card designers, etc.,” Nelson said. “Five years ago I noticed a lot of manufacturers were frustrated with their distributors’ service and they asked if I’d be interested in acting as their distributor. That’s what started SLS.”
Brand has always been the thing that moves product forward, and investing in branding is the most important investment to make in a product.
SLS moved from representing brands to distributing them, providing retailers a true service — offering products with solid brand recognition.
“Brand has always been the thing that moves product forward, and investing in branding is the most important investment to make in a product,” Nelson said. “A strong brand will help a product last even with oversaturation in the category — but without that name, the product will fade away with the rest.” SLS has maintained its original business model, carrying a brand’s entire line, instead of limiting to a few products. “If there isn’t a foundational brand name tying the products together, SLS will not stock it.”
Nevertheless, Nelson said an exception is made for some of the heavier lines from the “Big Five” (CalExotics, Topco Sales, Pipedream Products, Doc Johnson and Nasstoys). “We won’t carry every single item from each. We understand the bigger brands all have products of value and are certainly sellable, but if we take it on it must have a thread tying each product together into a cohesive collection.”
According to Nelson, every year since SLS Specialty’s inception has brought a 100 percent sales year.
“We used to be a niche distributor for gay and lesbian markets, which is still a significant part of our focus. But now about 60 percent of our business is in heterosexually minded mom-and-pop adult stores with 40 percent directed to LGBT business.”
SLS may have expanded its client base by focusing on its relationships with customers and manufacturers it represents.
“We work with manufacturers as partners,” Nelson said. “We get a lot of customer feedback and we share that with our manufacturers at full disclosure. We have no problem divulging whom we sell to and whom we don’t, and it creates a level of trust.
“The relationship and customer services we maintain with each are what helps us keep them on board even during tough economic times that often break weak loyalty and send customers to work with whoever is offering the items cheaper. And if a client does leave, they often come back after a few months as they miss the hands-on service. We really care about their businesses and what they are specifically doing in their stores. A discount isn’t always a true benefit.”
Customer feedback has confirmed SLS’ value as a customer-oriented distributor that’s often preferred over working directly with manufacturers.
“Many can go straight to the manufacturer but choose not to because SLS has specific knowledge about what the retailer should choose from the product lines. We personally know what each retailer specializes in, whether it’s lingerie, toys, couples products, male, gay, lesbian, etc. We’re not going to pick up the phone with a gay fetish store and encourage them to carry the latest portable stripper pole — it’s not their market.
The catering to retailers doesn’t start once they’ve placed an order.
“We don’t blindly try to hock product to every customer — we also pre-sell, as we know what’s coming out and when, and we get our customers excited about them before they’re even out on the market.
“That’s where our marketing emails come in. Each is brand specific; a customer will never receive a ‘What’s New at SLS’ email newsletter with a list of 50 different items. Each email is specific to a brand and highlights each product separately so as not to bombard the recipient. These emails are of tremendous value to the manufacturers, too.”
While some email blasts from other distributors limit their content to photos of each item with an order code, SLS lists each item with detailed information about the product in order to help the customer make an informed decision. “Manufacturers who work with us know SLS spends as much effort marketing their product lines as we do distributing them,” Nelson said.
Each month’s newsletter from SLS features manufacturer-supported deals, typically joined by an additional 10 percent discount off the brand being showcased. “We make them humorous and fun to read – hence the “Deal-licious” label — and we often see triple or quadruple orders of that brand after the newsletters circulate.”
Nelson said SLS’ goal for 2011 is to stay focused and continue to broaden its reach.
“We just hired our first full-time sales employee — previously, even with all of SLS’ growth, it’s always been just me and my inhouse staff making it happen,” he continued. “We have the first six months mapped out as far as what direction we plan to take and are prepared for whatever the industry brings.
“I’ve been fortunate to have found staff that are as dedicated to the company as I am, and that motivation and skill has been of the utmost benefit to me. A company can only succeed when its staff understands and truly believes in the business’ philosophy and goals. We work well together as a team and that team is what connects SLS with our customers and the industry as a whole.”