Thursday, February 7, 2008

Wholesaling is Complicated


My head hurts. And I don't have a headache. I was recently (finally after two previous attentions) accepted on - an online venue for artists to display their work for potential buyers.

I thought I had a good grip on the whole wholesale thing - but oy. Reading comments from retailers made my head spin. They have an entire forum for retailer to artist discussions. I'm grateful for their expertise but it means that I have to reexamine some of my pricing and payment policies.

"Big things should cost more than little things. When it comes to retail customers, size matters. We know that you spend every bit as much time and effort on those puny little things, but please, please average your costs out across your line so that the teensy, weensy little thing isn't the same price as the big one even if your cost is the same. "

I get that and it makes sense. It can be hard though when small things can be more time consuming, and sometimes even require more expensive materials.

"Don't price like you're the retailer. Your pricees should be in whole dollars or perhaps have an occasional fifty cents on the end. We have the MULTIPLY your prices by our markup and THEN make the price sound like a "real price". If you start out with 29.95 as if you're retailing, we end up with some pretty weird numbers."

I stopped using the .97 or .95 ending awhile ago because it made my life crazy trying to figure out tax at shows. But I can only imagine how confusing it becomes for retailers.

"Before you establish a price, try multiplying it by 2.25 and 2.5 to see what your customers are going to end up with at retail. If you're just over a "normal" price point, we'll ofen be forced to round down rather than up. We hate this. If we're coming up with $81 rather than 79.95, we just lost a dollar and can't really justify going to 84.95. However, if we go over that perceived price point of $80, it will affect our sales volume negatively. Sometimes just a tiny change in the wholesale price could actually increase your wholesale sales."

It is SO hard to price my work appropriately and I know I'm not the only artist who feels this way. I want to be able to sell directly to customers (though this is not recommended by some of the retailers on this board either - but I'll address that later) and be able to offer wholesale accounts. This means that I MUST price each piece high enough to allow a significant price break for a retailer. It is a tricky balance.

Getting advice directly from a retailer is invaluable to me so I am trying to take all their words in but there is a lot of information out there and some of it is conflicting. I'll try to take it all in and do my best.

1 comment:

capitolagirl said...

Great blog post! I can't wait to read more. I'm just getting started as an online jewelry seller, and think your article makes some great point. Thanks for sharing! And, since you're a Posh Mama, I'd like to invite you to join the Jewelry Making Mama's group at: