How you can profit from Dollar Tree! ~ Stacey Parks

This article was sent to me via newsletter by Stacey Parks. Stacey is the Author of “Everything You Need To Know About Distribution”. She is also the founder of Film Specific.com. Great articles, mp3 downloads, newsletters and more. Stacey’s site is a MUST SEE! 

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I want to share with you some new information I learned last

week over coffee with an executive of a U.S DVD distributor.

It was really eye-opening for me, and being that I always

want to deliver you guys the TRUTH of what’s happening out

there in the world of distribution, I thought this

would be important to share.

 

Basically he was explaining to me the reality of the VALUE-

priced DVD. And I’m not even talking Wal-Mart and Target

here….I’m talking Dollar Tree, 99 Cents Store, and Krogers.

Apparantly the profit margins that distributors make on value-

priced DVD’s ($1.99-$2.99 price points) far surpasses what they

make at the more ‘premium’ retail outlets like Best Buy,

Borders, and Barnes & Noble.

 

Why?

 

The answer lies in volume sales. Serious volume sales. For

example, a place like Dollar Tree may place an initial order

of 100K to 250K units, while a Best Buy might place an order

of say 5K units. So while the profit per unit is stronger at

the premium retailers, the overall profits are much

much higher with the value retailers.

 

And therein lies the future of DVD retail distribution! If

DVD distributors can earn higher profits by selling

to the value chains, then they’re going to be acquiring more

and more products that are appropriate for those outlets.

You may be wondering what genres do best here? He told me: Childrens,

Fitness, Educational, Animation – anything that can be an

impulse buy right next to the cash register that MOMS would

toss into the cart.

 

Oh, and here’s something else that shocked me – to keep costs

low for these massive orders of 250K units, they’re

manufacturing the discs in China for as little as 10 cents

per disc (the profit margins are usually 30-40 cents per

unit…you do the math). I left my meeting with this guy and

immediately started thinking of what Children’s program I could

produce to get into the Dollar Tree!

 

Anyway, of course not all DVD distributors are heading into

the Value arena, but you’ll notice on most DVD distribution

agreements these days they reserve the right to ‘value

pricing’ – and now you know what it means.

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Written by Stacey Parks
Film Specific

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About REEL Ladies

A Networking Community & Organization for Women in Film & Entertainment! View all posts by REEL Ladies

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