Hiro Retailing Workshop

© 2008 TAHITIAN NONI INTERNATIONAL

HiRO™

Retail Distribution System

Dave BoydDirector of Global Retail Sales


Where does the

Fearless System fit in?

• Access Marketing• Business model designed to access the potential and

income dynamics of powerful marketing channels for TNI IPCs.

• All cornerstones of Access Marketing funnel benefits through our compensation plan

• Four Cornerstones of Access Marketing1. Fearless Income Building: Advantage Program

2.Consumer Business: TNI Rewards Program

3.Retailing: HIRO and other Ready-to-Drink

4.Incentives, Recognition, Rewards: Success Path


Fearless Income Building

The Fearless Theme:

“The concept of ‘Fearless Income Building’ is to take all the risk* and fear out of

building a TNI business so everyone has a platform to build a significant residual

income.”

- Kelly Olsen, President TNI

*Conditional upon signing up 3 new IPCs in 30 days


The Fearless Rules

• Rules for your Fearless business

1. Never use your own money to fund your

business expenses

2. Convert your life to Tahitian Noni Products

and always get your product FREE

3. Never use your Residual Income to fund

business expenses


• How do I do this?

– Three step system

Step 1: Get your business fully qualified (start-up)

Step 2: Be Cash Flow Positive through Active

Income activities (your product is free!)

Step 3: Build Residual Income


Step 2


• What does “Cash Flow Positive” mean?

– Cash Flow Positive means profitability

– Being Cash Flow Positive indicates that your

business earns more than it invests both at

start up and each month thereafter

– Being Cash Flow Positive allows you to build

your business from a position of superior

strength and without fear since there is no risk

Step 2: Cash Flow Positive

Monthly Focus: Generate business revenue

through your activities to cover your

monthly CAS product investment =

Active Income


$126

Pack and Case

Recruiting

CAS

Recruiting

Retailing

Customers

Tahitian Beauty Spa

Parties

Plan 40

Success Group


Never use your

to fund your business!

Residual Income

Step 2: Cash Flow Positive


Retail Distribution System



• 18 years retail product marketing, advertising, & sales

• Last 5 years – Pure Fruit Technologies

• New Role: Drive HiRO™ Retail

Sales for TNI Globally

Not HiRO Product Line Manger

Not HiRO Sales Support/RSM

I will help you place HiRO into Retail

Meet the New Guy


• Created to expand brand awareness of TNI in the Retail market through IPCs

• Built to allow IPCs to build wealth through RETAIL marketing - Access Marketing

• Wider brand recognition of TNI products in retail can result in more activity and sign-ups

• Find at least ONE RETAIL STORE selling 7 cans a day and get product FREE.

– 12 cases a month

HiRO™ - The inside Story


Hold On!!

The HiRO™ ride is just beginning.


• They SELL!! 33 Million* 8.3 oz. cans daily!!

• Red Bull® developed the energy drink category starting in the 1980’s

• Marketing Basis for Category:

– Improves physical performance and stamina

– Increases mental alertness

– Improves reaction time

– Improves ability to concentrate

* World wide (Data Source: Euromonitor International)

Why Energy Drinks


• Most common ingredients: taurine, B vitamins, guarana

• Most common price range: $1.99 - $2.19

• WW Consumers will spend $41 Billion this year on Functional Beverages. $20 Billion on Energy Drinks

• 2007 WW Functional Bev. Sales $37.1 Billion (+9.3%)

• 2007 US Functional Bev. Sales $16.4 Billion (+11.5%)

• 2007 WW Energy Drink Sales $17.8 Billion (+15.1%)

• 2007 US Energy Drink Sales $7.7 Billion (+21.6%)(Data Source: Euromonitor International)

(Functional Beverages: Sports Drinks, Energy Drinks, Elixirs)

The Energy Drink Market


Consumer Demographics

Energy Drink Consumers

China Japan United States Sweden Germany Norway

0-14 10% 12% 14% 12% 11% 13%

15-24 30% 26% 33% 31% 30% 30%

25-34 24% 26% 21% 21% 21% 22%

35-44 14% 21% 15% 15% 18% 15%

45-54 10% 9% 9% 9% 9% 9%

55+ 12% 5% 8% 12% 11% 10%

• 69% Male • 89% Urban • All income levels


• 350,000 Retail stores selling beverages in US (not counting vending-only locations)

• 285,000 work for Energy Drink sales

• 165,000 get products through distribution ONLY (Tiers 1-3)

• 100,000 are independently owned retail amenable to buy direct from productreps or brokers (IPCs) (Tier 4)

Retail Beverage Distribution


Retail Distribution Tiers

•National Distribution Point

•Require 4% - 6% marginTier 1

•Regional / Local Food & Beverage Distribution

•Require 25% - 30% marginTier 2

•Retail Chains

•Require 40% - 50% margin

•Buy primarily through DistributionTier 3

• Independent Retailers – BEST TARGET FOR MOST IPCs

•Require 40% - 50% margin

•Buy direct, through Distribution, or both

Tier 4


• Product Appeal – Do consumers want it?

• Profit Margin at all levels – Can it produce revenue?

– Retailer 40%

– Distributor 25%

– Master Distributor 5%

• Product Movement – What will you do to drive sales?

– Product Branding, packaging, convenience

– Advertising and Promotion

Retail Distribution Demands


• Product Differentiation

– How is HiRO™ better or different?

– To whom does it appeal? (target market)

• Quality / Safety (Science, studies, testing, comparisons)

• Product Stability / Shelf life

• Manufacturer Stability - Who is TNI? Will they be around next year?

• Broker (IPC) Stability - Who are

YOU? Can you keep us in stock?

Retail Distribution Demands


• Free Fill offer or Slotting Fees (Intro Deals) - IPC

• Marketing Commitments, Ad Dollars - IPC/TNI

• Product Demos - IPC

– Where, when, how many, how long?

• MCBs, case stack deals, expiring product - IPC

• Shelf sets, displays, product stocking – IPC

• Product manufacturing - TNI

Playing the Retail Game


• Guaranteed In-Stock and Available - IPC

– Shelf real estate is precious, requires healthy “turn”, and will not tolerate vacant space

– Broker rep (IPC) often required to set shelves

• Retailer/Distributor Paperwork

– Supplier Agreement

– Expectations, requirements

– Payment terms, stipulations




Liability Insurance

• $2 Million General liability

• $1 Million Auto liability

• $10 Million Umbrella coverage


• Ordering and Re-Ordering – Be Prepared

– IPC should order supply to keep ahead of demand

– Will Retailer carry all or some products?

– Order financing – payment terms

• Ongoing Support and Relationship building

– Intro new product extensions

– Supply ongoing sales and promotional materials



• Primary Retailer/Consumer Concern: Price

• HiRO™ is Not just another Energy Drink

• “Functional Beverage that gives you Energy”

• HiRO™ is the Elite Brand in the Category…– Premium product worthy of premium price – Dare to Compare!

– ONLY one in the category with the equivalent of at least one serving of TAHITIAN NONI® juice

– All natural with added vitamins and minerals, lightly carbonated

– Low calories – only 10 calories per can

– Sustained energy - NO CRASH and Burn!

HiRO™ Positioning


• Product – What you have to sell

• Price – How much it costs

– SRP (Suggested Retail Price)

– Retailer margins

• Place – Where the product is best positioned to sell and Why

• Promotion – Where and How you will persuade consumers to purchase

Retail 101 – “The Four Ps”


• Is Wholesaling HiRO™ right for you?

• Long-term commitment of TIME and EFFORT

– Selling to Retail should be “In addition to”, NOT “In place of” TNI business

– Beware the “one-time sale” mentality

– Must continually service the retailer

• Keeping product in stock and shelves full

• Promotions and demos with product

– Realize revenue grows withvolume over time

Realities of Retail


• Financial commitment

– Think # of retail locations x ___ cans per day

• 1 location x 9 cans per day = 270 cans/month (12 cases)

• 2 locations x 6 cans per day = 360 cans/month (15 cases)

• 10 locations x 6 cans per day = 1,800 cans/mo (75 cases)

• 16 locations x 8 cans per day = 3,840 cans/mo (1 pallet)

• YOU CAN DO THIS!!

• Make it your goal to build retail business to justify pallet orders to be highly profitable

Realities of Retail


HiRO™ Pricing Chart

Qty $ per can Wholesale CV/QV

24 $2.70 $65 35

72 $2.56 $185 110

144 $2.43 $350 220

288 $2.34 $660 440

1-4 pallets $2.15 $8,260 per pallet 5,860 per pallet




100+ pallets $1.39 $5,299 per pallet 3,264 per pallet


• Call ahead – set appointment with “functional beverage” buyer or store owner

• HiRO™ is the “Product Line” Thermo™ is a

Product

• Meeting Preparation

– Samples – Supply a can of each product

– Literature – Product info/comparison charts

– Retailer/Distributor Paperwork• Liability Insurance info

Pitching the Product


• Meeting Preparation (continued)

– Promotional Support

• In-store : brochures, window clings, shelf tags, posters

• Product Displays: Cooler barrels, mini fridge, large product displays, case stacks

• Product Demos: in-store sampling demos

• Advertising: Radio ads, billboards, print ads, store flyers

– Price and Terms

• Ongoing direct sales and supply through IPC (Preferred)

• COD, 2% 10 net 30, net 30 - IPC

• Consignment - IPC



• Appearance and Professionalism

• Think and speak “retail vernacular”– Broker rep / manufacturer rep

– SRP, SKU, profit margins, payment terms

• Avoid “Network Marketing vernacular”– IPC, Independent Distributor, CV, QV, Personal Rebates

– Up-line, down-line, sponsor

– Beware Rewards Membership



• Role Play the sales call with a friend

– Personal Confidence – Believe in the product

– Build Credibility - Ask questions

• How robust are your sales of functional beverages?

• How many cans a day do you consider “good product turn”?

– Introduce Product, Price, Promotion

– Assess interest – Ask “Don’t you think Hiro would be a fantastic addition to your store?”

– Address concerns (case studies)

Role Play and Rehearse


• Most important part of the presentation:Ask for the sale!

• “How many cans of each product do you think you would need for a first-time order?”

• “What requirements do I need to meet to get an order placed today?”

• “How soon can I bring in Product to stock your shelves?”

• “Would you like to start with a case of each SKU so we can see which product appeals most to your customers?”

• Let’s Role Play

Role Play and Rehearse


• Selling to Tier 4 (Mom & Pop)

– Retail Price Point $3.59

– Wholesale Price $2.49 (30% or $1.10)

• Profit Analysis– IPC Price at 288 can rate: $2.34

– Profit per can $.15 can / $3.60 case / $43.20 (12 cases)

– Personal Rebate (20% or $.88/can) = $0.305 can / $7.32 case / $87.84 (12 cases)

– Gross Profit = $0.455 can / $10.92 case / $131.04 (12 cases)

• Minus freight, time, travel, etc.

Tier 4 - Independent Retail


• Selling to Tier 4 (larger independent)

– Retail Price Point $3.59

– Wholesale Price $2.154 (40%)

• Profit Analysis– IPC Price at 1-4 pallet rate: $2.15

– Profit per can $.004 can / $15.36 pallet

– Personal Rebate (20%) = $0.305 can / $1,171.20 pallet

– Gross Profit = $0.309 can / $1,186.56 pallet• Minus freight, time, travel, etc.

• Minus free-fill or slotting

• Minus sales and promo tools

Tier 4 - Independent Retail


• Selling to Tier 3– Retail Price Point $2.99


• Profit Analysis– IPC Price at 50-99 pallet rate: $1.79

– Profit per can $.004 can / $15.36 pallet

– Personal Rebate (20%) = $0.25 can / $960.00 pallet

– Gross Profit = $0.246 can / $994.64 pallet

Tier 3 Retail Chains




– Regional/Local $1.3455 (25%)

• Profit Analysis– IPC Price at 100+ pallet rate: $1.38

– Profit per can -$.0345 can / -$132.48 pallet


– Gross Profit = $0.1355 can / $520.32 pallet

Tier 2 Reg/Local Distributors




– Regional/Local $1.3455 (25%)

– Tier 1 Price $1.278225 (5%)

• Profit Analysis– IPC Price at 100+ pallet rate: $1.38

– Profit per can -$.101775 can / -$390.816 pallet


– Gross Profit = $0.068225 can / $264.984 pallet / $26,198.40 per 100p

Tier 1 National Distributors


• IPC Requirements– Order at 50+ or 100+ Pallets

– Must be selling to 100+ stores

– Freight costs

– Slotting fees or Free Fill

– Match Co-op Advertising funds

– Create and execute marketing campaigns

– Distributor rep incentives for new store placement

– Employee assistance

– Vehicles with wraps

Tiers 1 & 2 Distributors


For big energy and enhanced performance. A healthier alternative to crash-and-burn sugary energy drinks and sodas, HIRO Energy draws on the power of guarana, B vitamins, and taurine to give you the boost you need.**– Noni, to enhance health and vitality**

– Guarana, a natural caffeine, to give you energy

– High levels of B-vitamins

– 1,000mg of taurine, a powerful antioxidant

– Low in sugar and just 10 calories

– Fantastic taste

HiRO™ Energy – Key Selling Points

**These statements have not been evaluated by the Food and

Drug Administration. This product is not intended to diagnose,

treat, cure, or prevent any disease.


HiRO ™ Vitality – Key Selling Points

Packed with nutrients that help support and maintain a healthy immune system, HIRO Vitality is perfect for travel, work, vacations, or anywhere you need to give your immune system a boost.** Noni, powerful antioxidants, and vitamins and minerals help your body maintain a healthy state.

- Noni, to enhance health and vitality- Vitamins and minerals essential to a healthy immune system- No added sugar- Only 10 calories per serving- Terrific flavor


Drug Administration. This product is not intended to

diagnose, treat, cure, or prevent any disease.


HiRO™ Mobility – Key Selling Points

Do more than just get around—live every moment on your own terms. HIRO Mobility is the only joint support beverage in the world that combines the power noni, glucosamine, chondroitin, and MSM.** It delivers powerful, mobility-enhancing nutrients to your body to help ensure you move the way you need to.

- Noni, to enhance health and vitality - 1,500mg of glucosamine- 1,000mg of MSM- 500mg of chondroitin- Supports healthy joints** - Great-tasting flavor





HiRO™ Thermo – Key Selling Points

Now there’s a great-tasting product that burns calories while delivering the natural health and proven benefits of Tahitian Noni ingredients. Hiro Thermo harnesses the demonstrated science of EGCG and caffeine to help the body release heat through a chemical reaction within cells to burn calories (thermogenesis). Studies have shown that EGCG combined with caffeine increases metabolic activity.** - Burns calories- Increases Thermogenesis- Contains EGCG, a powerful source of antioxidants and

thermogenic enhancer - Boosts metabolism- Contains high levels of antioxidants- Tastes delicious





• Noni Office – Developing more robust HiRO™

Beverages section

– Developing common Q&A

– Training Presentations for IPCs

– Product and Sales Presentations for Retailers

• Webinars for IPCs

• Developing Retailer Intro Kit

• Regional retail sales trainings

• Helping close large deals (ICB)

Sales Tools and Training


By phone at x3606

By e-mail: [email protected]


Retail Help - I am here for YOU!

mailto:[email protected]