How Retail Buyers Actually Think

The German grocery market is worth over 250 billion Euros, controlled by four retail groups. I spent 16 years inside three of them, the buying director at Adica, Eva and Liedel. This is the coding German retail, what nobody tells you. So there is a conversation I have with almost every new client at some point, usually pretty early in our work together and it goes something like this. They say, "Yeah, I just don't understand what the buyer rejected us. The product is great, the margin was good, and honestly the meeting seemed to go really well." And I always, always, ask the same question back, I say, "Tommy, what do you think the buyer was doing in the 30 minutes before you meeting?" And there's this pause because they have no idea, they don't have a clue, they've never thought about it. They've been on so focused on preparing their own pitch, perfecting their own story, rehearsing their own numbers, that they completely forgot to think about the person they are telling all of this too. And that is, right there, that is where most market entry strategies fall apart, not on product, not on pricing, but on a fundamental failure to understand how the human being on the other side of that table actually operates day by day. Now, in the previous episodes, I've described the German reach of system from a pretty structural perspective, how the shelf works as a machine, how money flows through the three profit levers and how categorical management operates as a power structure. And all of that is essential knowledge, genuinely. You need to understand the system before you can work within it. But today, I want to do something different, I want to zoom in, not on the system, but on the individual, the person, the buyer. Because at the end of the day, systems don't make decisions, people do. And people, even highly trained and analytically monitored people, are shaped by their environment, by their incentives, by their stress levels, and by their career history in ways that most supplies never stop to think about. So let me tell you what it's actually like to be a buyer in German retail. And I don't mean the job description version, the one you'd find on career pages in summer. I mean the real version, the version that I've left and seen for 16 years. Alright, so the first thing you need to understand, and I mean really internalize, is the sheer volume of decisions that a buyer has to make on any given day. Because from the outside, it might look like the buyer's job is to sit in meetings, evaluate products and make thoughtful decisions about what goes on the shelf. And yes, that's part of it. But it's maybe, and I would say 30% of what actually happens. A typical buyer or category manager at a major German retail is responsible for somewhere between 800 up to 1200 individual skews. Let that numbers sink in for a moment. Every single one of those products of those more than 1000s skews has a performance history that needs to be monitored, a margin profile that needs to be maintained, a promotion calendar that needs to be coordinated and a self-conditions that needs to be renegotiated at least once a year. On top of all that, the buyer receives, on average, about 20-25 new products, new proposals every single week. That's over 1000 new ideas a year, of which maybe optimistically, 5 to 10% will actually end up on a shelf somewhere. And here's the part that most people from outside the industry really don't appreciate. The buying teams are structurally understaffed. In general, the FTE quarter, so the full-time employee quarter in most German retail buying departments is roughly 40% below where it would need to be, would need to be to handle the workload properly. Well, it's all about efficiency at the end of the day, sure. But what does it mean? It means in practical terms that every buy is doing the job of about 1.5 people constantly. The average meeting slot is 45, maybe 60 minutes. And then at that time the buyer needs to understand your product, evaluate your pricing, assess the category fed, consider the implications for the existing assortment and form at least a preliminary view of whether this is worth pursuing. If you spend the first 20 minutes on your company history and your farm vision, you've just used more than a third of the buyer's decision making window on information they cannot do anything with. And the rest of the buyer's day, the buyer is not sitting in meetings. I can tell you that. Its internal performance reviews reporting to their category director, coordinating with logistics on delivery issues, firefighting with a supplier cannot deliver on an action promotion, sending internal presentations where they have to justify every single decision to their superiors. When you walk into that room with your beautiful pitch deck, you are one of many, many demands on a person who is already operating at a maximum cognitive capacity. And if you don't respect that reality, you're not just wasting your their time, you're actively working against yourself. Okay, so now I want to share something with you that I've developed over 16 years of observation and it's a classification system for buyer types. Now I want to be clear. This is not an academic framework from a textbook somewhere. This is what I've personally seen, sitting in those rooms, negotiating with these people, having those as colleagues and later managing teams of them. And I think it's genuinely useful because understanding which type you're dealing with can make the difference between a productive conversation and a complete waste of everyone's time. So there are roughly five archetypes and they tend to correlate with experience level, although not always perfectly. The first type is what I call the junior, the rookie, typically one, two, three years in the room, full of energy eager to prove themselves and very, very focused on following the rules. The junior will evaluate your product exactly by the book, margin check, rotation forecast, category fit analysis, competitive landscape review. It's almost algorithmic. And if your numbers don't take every single box on that checklist, you are out. Not because they don't like you, but because they don't have the confidence or, frankly, the authority to make exceptions. The upside, they are predictable. If you prepare well and you know that they're going to ask which at that point in the podcast you should know, you can pass their test. It's a test by the way, that's genuinely how they think about it. The second type is the operator. I call it the operator because three to seven years of experience is what they are being based on and they've they've been around long enough to develop their own shortcuts and heuristics. They know which rules can be bent and which ones cannot. They are more pragmatic in the junior. More willing to take a calculated risk on a product that does not check every box but has something interesting about it. But they are more cynical. Save, hurt, every saves pitch in existence. They can smell overselling from across the room and they have zero patience for it. With the operator honesty and directness work much better than publish. Just tell them what it is, what it costs and what it'll do for their category, no fluff. And the third type is the tactic and the tactician. And this is where things get started to get let's say more complex. Seven to maybe 12 or 15 years of experience, the tactician has fully understood that negotiation is psychology. They know how to create pressure, how to play suppliers against each other and how to extract maximum value from every single conversation. And they are not above using information as a weapon. If a tactician tells you your competitor just offered us 5% more margin that might be completely true or it might be a calculated bluff designed to make you panic and improve your offer. And honestly, you probably won't be able to tell which one it is in the moment. That's the whole point. The fourth type is the strategist. 15 years plus in the business. And talking to a strategist feels fundamentally different from the first three types. Less adversarial, more exploitory. They ask questions that seem casual but are not. They are thinking three moves ahead. They develop suppliers over time. They orchestrate multi-vendor strategies where different manufacturers serve different roles in the category and they build dependencies deliberately not to exploit them immediately but to have leverage when they need it. Every conversation with a strategist has a purpose. Even when it feels like you're just having a friendly chat about the market, especially when it feels like that. And then there's the fifth type and this is rare. Maybe five percent of all buyers or buying directors in charge ever reach this level. I call it the master. The master can shift between charm and pressure, between partnership and hard negotiation. Sometimes within the same, the very same meeting. Sometimes within the same sentence. They've been through every negotiation school. Shrana, Harvard, Camp, you name it. They know all the frameworks. They can identify them when you use them. And they know exactly when to throw all of that out and go purely on instinct. The master is formidable not because they follow rules but because they've transcended them. And if you ever find yourself sitting across from one, the best thing you can do is be prepared, be honest and be very, very clear about what you actually want. Now, the point of all this is not to put people in neat little boxes. People are more complex than that, obviously. The point is that this way or their way, you pitch to a junior should look fundamentally different from how you pitch to a strategist. The data you lead with, the language you use, the pace of conversation, the level of detail, all of that should adapt to the person across the table. And if you walk in with the same presentation for every buyer, regardless of who they are and where they are in their career, you're essentially leaving your success to chance. And in a system as structured and as competitive as German retail, chance is not your friend. All right, so beyond the individual archetypes, there are few universal truths about what drives buyer behavior in Germany. And these apply across the board regardless of whether you're talking to a junior or to a master. They are all connected to incentives and internal pressure. And once you understand them, a lot of buyer behavior that seems irrational from the outside suddenly makes perfect sense. The first one is performance tracking. And I mean constant granular, relentless performance tracking. Every deal of buyer closes is documented and measured. Margin targets category growth versus last year, promotional effectiveness, year over year comparisons against peers in other categories. The buyer is on a scorecard and that scorecard is reviewed regularly and everyone knows everyone's else numbers. So when a buyer pushes hard on price in your negotiation, it's not always because they genuinely think your product is overpriced. Sometimes it's because their internal scorecard demands improvement this quarter. And your negotiation happens to be the one where they need to deliver a result that they can show to their boss. That's not personal, that's systematic. And understanding the difference is crucial. The second universal truth is something that psychologists call loss aversion. And it's incredibly powerful in this context. But simply, the fear of making a bad decision is much much stronger than the desire to make a good one. Listing a new product that fails after three months is worse for buyer's career significantly worse. Then they're never listing that product at all. Because the failed listing is visible, it shows up in the data, it gets discussed in the review and it reflects poorly on the buyer's judgment. Whereas the product that never got listed, nobody ever talks about mis opportunities. Well mostly, there's no line item for great products we should have listed but didn't. So the buyer's default, especially in a risk of us, risk of us corporate culture, is to say no. And more precisely, to say very interesting, let me think about it. Which, as we all know, usually means no. And the third universal truth, and this one is often overlooked, is turnover. Buyer turnover in general return is significant. The average tenure in a specific buying role is somewhere around two to three years before people move on either to a different category within the same company to a competitor or out of purchasing or buying entirely. So this turnover is not about sales. It's about fluctuation. The burnout rates in category management and buying have tripled since 2015, which tells you something about the pressure these people are under. And it also refers to one of the first points I just stated in this episode that they're due to high fluctuation. It's kind of a scarcity of buyers present concerning the FTE framework pattern. And what this means for you, practically, is that the person who spent months building a relationship with the one who finally understood your product and was starting to champion it internally. That person might not be there when it's time for your listing to be renewed. And the new person who takes over has no memory of your conversation. no emotional investment in your product. They only see your numbers. And if those numbers are not strong enough to speak for themselves, you're stunning from zero. So what's the practical takeaway from all of this? And I want to make it really concrete because this episode has been quite let's say psychologically dense. The takeaway of this is this and it's deceptively simple. Before you prepare your product, prepare for the person as well. Find out who you're meeting with. And I don't mean just their name and title in order to write them or address them directly. I mean, how long have they been in this role? What categories have they managed before? What's their buying philosophy and are they data driven or related driven? Are they under particular pressure this quarter? Maybe because of mistarget or a category review? Is there team fully staffed or are they covering for someone who left? All of this information is available if you look for it. Maybe through LinkedIn, through industry contacts, through trade publication, through maybe a distributor, through the simple and remarkably underused act of asking someone who knows them. What is this person like to work with? The brands that consistently succeed in general retail are not and I really want to emphasize this, the ones with the best products. There are the ones that understand the person across the table better than that person expect to be understood. And that's an advantage that no competitor can copy from your packaging. That's not something you can buy at a trade show or put into a PDF. That's preparation. That's empathy applied strategically. And it's the single most underrated competitive advantage in this market. If you're preparing for a specific buyer meeting and you want to understand exactly who you're sitting across from or they care about and how to tailor your approach to their specific style, that's the kind of preparation I do with my clients, not generic advice, but specific meeting level preparation. Details on the website. Thank you for listening today. If you're constantly planning your entry into the German market or you're already in conversation with buyers and something doesn't feel quite right, that's exactly the kind of situation I work on with my clients. You will find everything at www.fr-advisory.com. If you liked this episode, share it with someone who might like it as well. And if you didn't find it useful, send it to someone you don't like. That works too.