The first myth they would have business owners believe is that you have
to be a Fortune 500 company to do business with Wal-Mart and others. In
Wal-Mart's case, they have 61,000 United States suppliers and thousands
more international suppliers, so they can't all be large companies.
Small companies still need to meet their vendor requirements, but if
you are applying under their "store of the community" program, you can
start by supplying only a few stores and don't have to meet the same
financial requirements as a national vendor.
The second myth is that Wal-Mart in particular will beat vendors
down on price so much that they will not be able to make any money.
While it is true that some suppliers don't make any money, those are
the suppliers who are selling a commodity and whose products are
identical to their competitors so it all comes down to price. In that
situation, the lowest cost producer may be the only one to make money.
Although all of Joe's products were in established categories, they
were also unique and different enough so that he was able to make good
profit margins even dealing with Wal-Mart and Target.
The third myth is that major retailers don't pay on time and will
make vendors wait 6 months to get paid. That's not true. As long as
vendors follow their published procedures, they'll get paid on whatever
time is negotiated when being set up as a vendor. Joe was able to get
paid in as quick as 10 days from Wal-Mart and in 30 days from Target.