MEMO FROM ERIC
Memo to: Steven Hess
Hello again –
I received the following questions from a shareholder. The answers are provided here rather than on the FAQ because of the goal to keep the FAQ focused on questions that remain conceptually and factually relevant for a longer period of time. I have removed the name of the shareholder to protect their confidentiality.
My response was as follows:
In preparing responses to your questions, it became apparent that answers to your questions about related issues were already provided indirectly in a number of the existing FAQ answers at www.WinningBrands.ca Therefore, instead of providing new question postings to the FAQ section, I will summarize for you below specific responses/clarifications for your convenience. My comments and responses are in blue below your own comments and questions. They are not confidential and may be shared as appropriate.
I have recently begun investing in your company, started with a small investment of 4mil shares and have several questions
Thank you for becoming a shareholder. A vibrant community of retail shareholders is in everybody’s interest, including the shareholders themselves. We at Winning Brands understand that investors have many investment possibilities to choose from. We never take it for granted that an investor would select Winning Brands over another stock.
1) It seems products are starting to hit store shelves recently. Is there any specific stores that carry your products
We have introduced a Store Locator feature on our website. It is located on the lower left hand side of the Home Page navigation bar at www.WinningBrands.ca Some of the stores listed are still new – not all staff of these stores recognize the product name. Also, not all outlets of a participating chain have taken delivery yet. Therefore the Store Locator feature is still a work in progress. The greatest challenge is for the manufacturer to learn from the distributor which of the distributor’s retail accounts have taken on the product. Distributors are not always equipped to update such information and are not always keen to let go of what they consider proprietary information. As a practical matter, the Store Locator feature is a good starting point. If a consumer is unable to obtain Winning Colours Stain Remover from a named store, the consumer is welcome to contact us for further assistance (and sometimes does).
2) The products seem to be competing directly with obvious large companies that are integrated in the market place. How are you going to get people to try your products?
Large brands are well established and serve as benchmarks for quality and performance. Consumers today, more than ever, have extremely fluid “brand loyalty”. This makes it much easier to “get tried” and also easier to be replaced by the next good idea. Therefore, Winning Brands strategy is to ensure that it only releases products into mainstream distribution that have a clear competitive advantage that remains current and relevant through on-going adjustments in the performance/price mix. Secondly, by focusing on niches which are not yet large enough to justify full dedication by a consumer packaged goods giant, Winning Brands can accumulate aggregate sales that are attractive for Winning Brands for the foreseeable future. Careful niche marketing makes it much more likely that word of mouth recommendation within stores and amongst consumers will work in the background to increase exposure. Once a product “catches on”, the regional and ultimately national advertising is likely. Until that point however, in-store merchandising awareness strategies are more cost-effective in stimulating spontaneous buying at points-of-purchase.
3) At what point if any are you planning on expanding into regional or national stores?
There are discussions on-going with well known banners, however these retailers prefer that their interest is treated confidentially until such time that their position on a listing is definite. Rather than raise expectations amongst investors, Winning Brands management practices a policy of low-key factual news releases that describe things realistically. This means that that releases describe things which are definite or already known to be the intention of named parties, rather than being optimistic in tone.
4) Is any of your products for industrial use?
Yes, most of our products can be acquired in commercial use size containers.
