Marani Brands Inc. (MRIB)

[Matthew Berg]

Three bottles here, four bottles there... No restock in preparation for a successful promotion? Sounds an awful lot like a clearance. It will be interesting to see how much, if any, Costco restocks. You have to understand the way these tests work. Not all the deals are the same but general policy for tests are co-op based. The company pays $X amount for the space as a slotting fee, sometimes in cash, sometimes in product or combination. Costco issues a recourse PO for the initial order. If the product doesn't sell out it generally gets pulled and remaining stock gets put on clearance and/or sent back to the vendor. No vendor wants to take back product especially if it represent less than positive sell through nor do they want to be on the hook for the cash value of the return and subsequent credit so they will usually do a steep discount to try and complete the sell through. The fact that it seems non of these stores were adequately supplied is not a miraculous weekend of sales but clearance of the remaining balance of the initial order that had two months to sell and didn't. It will be interesting to see if Marani is on the shelves next week especially at Fullerton and Burbank. One other odd thing to me is that ere was no Marani on the shelf, just the four bottles on the table. That's not usually how the promotions go. The promotion is suppose to drive people to the stocked shelved product. Instead Marani got replaced by another SKU, probably because they started with less than a fully stocked shelf which Costco will not do!