Question Hi
I just received a request about my handmade crafts,i currently only have one of these necklaces and have been asked if i will consider selling wholesale,i am really not sure what this would entail,any advice much appreciated.Regards.
Answer Dear Violet,
Selling wholesale is a great way to sell your products. Some of the many advantages are (1) You make to order knowing the products are already sold (2) You sell more than 1 item at a time (3) there is a potential for re-orders and developing a relationship with a store where they will want more products from you (4) Make a set of samples and take orders from showing that set (5) Batching your orders for raw materials so you can purchase everything you need wholesale at a better rate.
There are also many other advantages - but in my opinion the best way to grow a business to make a profit is to sell items wholesale.
Also you will need to price your product correctly for selling to stores. So you have to price your item correctly since they will at leas double your price for selling to their customers. This make take a little research on your part to come up with a good price.
It is best to start with your cost of goods. This is determined by adding up all of the costs involved with making your product. In your case it is necklaces. Create a spread sheet and write down all the materials in the necklace - such as beads, clasp etc. and determine what the costs are - (please bear in mind that you need to know the wholesale costs that you will be spending. So if you use 10 beads at $1 wholesale each then your cost for beads is $10. Once you have all of these items - go back and make sure you add in other costs involved such as shipping charges that you paid to get the materials. Next you want to pay yourself or someone else for labor. If you are making the necklaces yourself then you need to determine what you would have to pay someone else to make the necklace. DO NOT leave this blank! Some people do not pay themselves and this is something that must be included in your cost of goods.
Once you know your cost of goods - this will be your starting point for determining your wholesale price. There is no exact formula. You will need to do research to determine how much a necklace similar to yours will sell in the retail market. To understand this you need to look at similar products and go shopping. You may already know this - but it is important to get a fresh point of view.
Now that you have all this information make a decision about what your wholesale rate is going to be - working backwards from the RETAIL price. For example - if you find other necklaces similar to yours that are retailing for $85 and you know that the retail store would have to be able to purchase it from you for no more than $42.50 (and maybe less) to sell at the $85 price - and your cost to make the necklace is a total of $20 then you know that you could easily sell it to the store for $40 and everybody wins! On the other hand if your costs to make the necklace are $60 then you either have to get your raw materials for less or change the style or decide not to make the piece.
I hope you have found this helpful. Please sign up for my free report and my newsletter as I think I have lots of information that will be helpful to you as you continue building your business.
Love %26 Success,
Jane
Jane Button
The Product Mentor
www.Design2MarketSuccess.com
"Secrets to Product Development, Manufacturing, Marketing, Sales and Profiting from your wholesale or retail creative product business."
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