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  • Wholesaling

    Hi,
    I have a shop possibly interested in stocking my candles.
    They have asked to buy them at 50% off the retail price ~ does this sound about right? I know I am not going to make much on wholesale orders but would like to know they are offering a fair price.
    Any advice would be great.
    Thanks, Louise

  • #2
    Originally posted by burning_it_at_both_ends View Post
    Hi,
    I have a shop possibly interested in stocking my candles.
    They have asked to buy them at 50% off the retail price ~ does this sound about right? I know I am not going to make much on wholesale orders but would like to know they are offering a fair price.
    Any advice would be great.
    Thanks, Louise
    Hi Louise
    That seems a huge amount to me. I suppose it depends on what your profit margin is.
    I would have thought it better to sell wholesale at retail price less 50% of profit. That said, when it comes to business I'm very naive.

    Isabel

    Comment


    • #3
      Wholesale can be a bit of a double edged sword. One one hand it means you making candles that you know will return very little (if ANY) profit and that's no fun. But on the other hand, it's great exposure.

      Make sure your website details etc. are clearly shown on the packaging and foot traffic through the shop will turn into online shoppers where all the profit will be yours. Think of it as advertising.

      Comment


      • #4
        Originally posted by Spencer101 View Post
        Wholesale can be a bit of a double edged sword. One one hand it means you making candles that you know will return very little (if ANY) profit and that's no fun. But on the other hand, it's great exposure.

        Make sure your website details etc. are clearly shown on the packaging and foot traffic through the shop will turn into online shoppers where all the profit will be yours. Think of it as advertising.
        I don't mind making that at 50% off because as you say, its good to get them out there and I hope most sales will be direct anyway.
        My packaging has my logo and website on

        Comment


        • #5
          Hang on a mo. In your retail price there should be an element to cover your costs for selling them. That's the bit you are letting the wholesalers 'have' as they'll have to pay their sales staff to sell your candles.

          At the moment you are the maker and the seller. If you become just a maker you still need to make a profit.

          There are two ways of looking at this. They are your candles. You make up the rules. Don't let them bully you on price.
          Or ...... it is common for a retailer to double the price they bought their stock at. A deal is a deal. Some money is better than no money.
          Just remember they might come back for more. You don't want to get cross with yourself for working for nothing.

          A PS - the advertising costs component should be in your price somewhere. It's not there for you to give it away to the shop. You have used it up getting the shop to notice you.

          Comment


          • #6
            When I was running a baby equipment shop the mark up varied with each product, but commonly it was 30%. This fits with the calculation:

            Production cost x 3=rrp

            Which allows everyone to make a profit.
            Please come see me on:

            Facebook
            Twitter

            Or on my blog Candles From Home

            Comment


            • #7
              Could you offer them, say, 60%?

              Another option is to say 70% of your retail price but if they take over a certain quantity you'll let them have it for 60%?

              I think the retailer would also have to charge VAT which puts their price up further so they'll be keen to drive you down. I would take a bit off but 50% sounds a lot.

              but fantastic - well done you!

              Marion

              Comment


              • #8
                I believe that retailers want to make at least double on the products they sell. I have just spoken to a couple of friend that by products wholesale and one said they buy products at 40% to 50% off the retail price and the other says half or little less than half.
                I know wholesaling isn't that profitable, its just tough at where to put the price. I am going to ask someone I know who wholesales her beauty products what she does. Will report back.

                Comment


                • #9
                  I'll be at the Spring Fair at the NEC this week and the wholesalers there will be expecting their products to be re-sold in retail outlets for at least twice what they sell them for. We have trade customers who we wholesale to and we look at supplying them at production cost x 2, and they then double that to retail. We therefore set our retail as at least 4 x production costs (as long as the market can take it - which it usually can).

                  Just don't undersell yourself and the size of the order is worth it.

                  David
                  www.panachegifts.co.uk

                  http://www.facebook.com/pages/Panach...60271863992797

                  Twitter @PanacheGifts

                  Comment


                  • #10
                    Originally posted by rosecottage View Post
                    I'll be at the Spring Fair at the NEC this week and the wholesalers there will be expecting their products to be re-sold in retail outlets for at least twice what they sell them for. We have trade customers who we wholesale to and we look at supplying them at production cost x 2, and they then double that to retail. We therefore set our retail as at least 4 x production costs (as long as the market can take it - which it usually can).

                    Just don't undersell yourself and the size of the order is worth it.

                    David
                    Thanks for this ~ it is really useful.

                    Comment


                    • #11
                      Originally posted by burning_it_at_both_ends View Post
                      Hi,
                      I have a shop possibly interested in stocking my candles.
                      They have asked to buy them at 50% off the retail price ~ does this sound about right? I know I am not going to make much on wholesale orders but would like to know they are offering a fair price.
                      Any advice would be great.
                      Thanks, Louise
                      Another thought - I would expect to pay more for a candle bought from a shop (especially if it was a lovely shop) than direct from the maker. So maybe you could say to them the shop retail price would be higher than direct from you.

                      Not sure if that helps though - 50% markup is a lot for you to lose.

                      Marion

                      Comment


                      • #12
                        Originally posted by rosecottage View Post
                        I'll be at the Spring Fair at the NEC this week and the wholesalers there will be expecting their products to be re-sold in retail outlets for at least twice what they sell them for. We have trade customers who we wholesale to and we look at supplying them at production cost x 2, and they then double that to retail. We therefore set our retail as at least 4 x production costs (as long as the market can take it - which it usually can).

                        Just don't undersell yourself and the size of the order is worth it.

                        David
                        So instead of 3 x production cost you would recommend 4 x?

                        You could also market research your competitors and see what they are wholesaling at, and be guided by these prices.

                        Don't undervalue yourself and remember what you need to earn from your hardwork, if they push you to far walk away,they weren't the right place for you anyway (be brave).
                        Please come see me on:

                        Facebook
                        Twitter

                        Or on my blog Candles From Home

                        Comment


                        • #13
                          Originally posted by Anna Rose View Post
                          So instead of 3 x production cost you would recommend 4 x?

                          You could also market research your competitors and see what they are wholesaling at, and be guided by these prices.

                          Don't undervalue yourself and remember what you need to earn from your hardwork, if they push you to far walk away,they weren't the right place for you anyway (be brave).
                          That's what we look to achieve on products that we wholesale on but obviously it depends on your market and who you are selling to. If we can sell an item only at 2 x production costs we won't wholesale it as I don't believe in working for nothing! We also won't do sale or return but that's perhaps another question.

                          Good luck

                          David
                          www.panachegifts.co.uk

                          http://www.facebook.com/pages/Panach...60271863992797

                          Twitter @PanacheGifts

                          Comment

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