Wholesale Questions... please help.

[Former_Member]

I was approached for a B&M retail store for a wholesale order, but I'm so new at this I don't know where to start. This is something that I would like to do, so I don't want to give terrible terms for wholesale, so if anyone is willing to help, I'm ready to listen...

What are typical wholesale policies? What should these policies include.?.. I'm thinking like a sliding-scale for % based on number of products ordered.. or maybe straight 50% if 5 or more are ordered..

And what other terms should there be? What is typical turn around time? Any advice is much appreciated.

[Former_Member]

Prices just determines how much it takes you to make the products. Normally wholesale is like a 60/40. I would have them purchase a X amount of products. Turn around time 2-3 weeks. Then each additional order could be maybe 100.00 or 150.00 to reorder. HTH.. I would do a search on here for wholesale I know it has been talked about quite a bit. Also do a google search. HTH

[Former_Member]

Lollie,
I've been approached twice by stores looking to do wholesale with my sock monkies and honestly it's never worked out for me. Wholesale is very appealing but whatever you do with prices just make sure you're actually getting paid for your time and materials on each item. I think wholesale is really tricky on handmade unless you are selling prints or something where you can get a break on printing if you print a higher volume.

If I make one sock monkey or 15 each one takes the same amount of time. I would have to inflate my prices in order to allow price breaks or a sale for that matter.

So I guess i'm not a great one for advice on this subject, just make sure you don't shortchange yourself just to get the order because it can be tempting to do that I think. But at the end of the day if you figure you're getting paid peanuts per hat it's probably not worth it. Your party hats are awesome by the way.

Good luck!

[Former_Member]

heidibg--- Thanks for the compliment..I love your green argyle sock monkey .

this makes a lot of sense. ... my hats may look simple, but they take hours to make. It will take me literally all day to make 3... and I don't want to slave away for that many hours just to make maybe $30 minus materials.

Perhaps this is what I needed to figure out... sounds different in the brain and looks much clearer in black n white...

[Former_Member]

This is a tricky one for me for a different reason. I make lampwork beads primarily, so most of my orders are for what amounts to supplies. In order for my customers to make a profit on what they make from my beads, I have to charge what amounts to wholesale on them. It takes me slightly less time to make the 50th bead than it did for my first, but not a lot less. Since the standard formula is cost of materials + labor (I figure a measley $10/hour) x 2 for wholesale, I have mixed feelings about this.

Carpol

[Former_Member]

I recently had a wholesale order and I was completely at a loss on how to price my items in order to make a profit while still offering a discount.
Luckily it was on an item I had not underpriced and I could afford to do wholesale.

The person I dealt with was really kind and understood that wholesale for handmade items is a tad more than wholesale from a manufacturer, so I was lucky in that aspect.

First and foremost decide whether offering about 40-60% off your items leaves you with enough profit to make you happy. If those price points leave you with enough profit for your work, then I suggest making a table.
making a table with different price points really helped me feel organized and helped me visualize how much profit I would receive per quantity.
for example I offered something like
0-20 items for 6.50
21-40 for 6.00, etc.

Wholesale can be a great opportunity and it's definitely encouraging to keep doing what you do. So I wish you the best and I hope you can find a price that works for both of you.
Good luck! :]

[Former_Member]

LolliBlossom,

lovely hats and cookies!!! :)

I've approach for wholesale so many times and I always refuse. You have to think if this is something you want to develop into a bigger plan where some factory in China may start producing your lovely hats and you get the percentage of the profit, or you keep it your personal little (well, not 'little' as in little, but rather 'cute') shop where YOU are the only one to give out orders and make rules on the pricing etc.

As someone else said, it's difficult to decide for handmade items, because most of us work really hard and dedicate ourselves for the passionate bussiness, and so to think of doing the same thing for half the price (even if 20 of them) seems unacceptable.

I think wholesale works if

* your retail price is high enough
* you don't spend hours creating one single item
* the materials are fairly cheap

If made all my items in 10 minutes, I would do it. Sadly its so much more than just 10 minutes. Hope this helps in some way.

[Former_Member]

I make work ranging from $10,000 to $20. The expensive stuff is stricktly gallery only. Then there is one of a kind hand made items some high end others mid range. I've recently started working on a wholesale line of work. In order for wholesale to work you must re-work it for wholesale. If I made something that took hours and hours and I sell it at a $10 per hr profit, there is no way I could sell it for less.

Your items must be able to be made quickly and consistently. If it can't, it won't be worth while. The trick is to figure out how to make an item quicker, consistently, but still have the quality and feel of the "higher end" stuff.

Most people start with the idea that each peice is one of a kind, handmade, and price it on the lower end thinking I just want to sell it. But if things start to go well, it's harder to do wholesale since the profit margin is even smaller. This also makes it harder, sometimes, to raise prices if customers are already use to that price. Also, if you charge more for the wholesale items, making them have to sell it for more they wouldn't like the fact that you are undercutting them.

Wholesale is a trade off and you have to decide what you are comfortable with in terms of poduct and your profit.

[Former_Member]

LollieBlossom your items are stunning!!

[Former_Member]

Thank you for all of the advice. The different view points and have cleared things up for me.. although it is tempting to make a sale, the last thing I want to do is undercut myself.

I feel that my items are priced appropriately for the amount of time I spend on them, and taking less than that probably isn't a good idea... Now if I could come up with a less time consuming project like springmontes suggests... this could be possible in the future.

Thanks again for all the input. :)

[Former_Member]

AndiaCreations- You're so sweet. :)

[DecorativeDesignWKS]

Just my two cents: having spent the last 15 years as a buyer of wholesale products for resale, many of them being custom made items, I don't think you have to completely shy away from it just because you have hand crafted and time consuming items.

Your things are beautiful and whimsical and I can see why a store would want to carry them! Let's think about it this way: your little girls' princess crown with roses is a perfect item for a shop. Appealing to a wide range of moms and grandmas and aunts who have a little girl in the family and like to buy her unique gifts from their heart. You sell it here for $28.00. Do a google search for dress up princess crown and you will see there are some pretty expensive dress up items on the market. Say a tutu and tiara for $89. Yes there are cheap ones too - but nothing like your product so that does not matter.

So, depending on your local market and the type of shop that approaches you, there is still room for mark-up on the buyer's end if they have a shop that brings in clients who are looking for something other than whatever is cheap. I could see these selling for $40 in the right setting.

Plus, you could perhaps simplify and streamline your process for this item when you intend to sell it wholesale. Perhaps you put slightly fewer flowers or beads. Perhaps by cutting all the items at the same time for 4 or 6 hats, you save a bit of your time. So now you might feel as though you could sell six pieces at $20 each rather than $28. (Or somewhere in between.) And so we now have a price you can make money at, and the buyer can still mark up 100%. (Which is a typical mark-up for gift shops. Of course with hand crafted goods they may take slightly less as they see the benefit of having it in the store.)

Obviously this is just an example and I made some assumptions that may not actually work out in real life - but I am just trying to show that there might be a way for you pick and choose a design or three that you can try at wholesale and you would have a chance to try to get more business and the shop will be very happy as well to have such a unique item. Of course you may just not have time to do wholesale at all - but if you can get a good price it might be worth while and you can always control how much and how often you make the product available so you can "work it in" along with your regular production.

Not going to work in every case but I wouldn't discount it altogether - no pun intended!

Your work is so great, and I wish you luck!

Tamara