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View JoeyG's profile

Fair Commissions

by JoeyG
posted 790 days ago


26 replies so far

View Monte Pittman's profile

Monte Pittman

13221 posts in 934 days


#1 posted 790 days ago

That’s a standard here as well. I think it is excessive also. But they don’t negotiate.

-- Mother Nature created it, I just assemble it. - It's not ability that we often lack, but the patience to use our ability

View KoryK's profile

KoryK

229 posts in 1285 days


#2 posted 790 days ago

I’m just starting down this road and negotiated a deal with a shop owner out of Tennessee. We agreed I set my own pricing and we do a 70/30 split (started with a 60/40). The big difference is she pays for all advertising and promotions. She has already scheduled an interview with two of the local papers to highlight my work and in turn her shop. She is also trying to get my work in other shops at a wholesale price, but we are still talking about that. Like I said, this is my first attempt so I don’t know if its a good deal or not. We will see, but it seemed fair and I don’t know if any other shops would be willing to do it. Don’t hurt to ask?

-- If you not making sawdust, your probably wasting your time. Kory

View jaykaypur's profile

jaykaypur

3252 posts in 1005 days


#3 posted 790 days ago

I have 2 places that want me to bring them some stuff. We have not discussed any monies/percentages but I am just honored that they asked me…...........J

-- Use it up, Wear it out --------------- Make it do, Or do without!

View Douglas Bordner's profile

Douglas Bordner

3960 posts in 2660 days


#4 posted 790 days ago

My only attempt at local giftshop placement was a 60/40 split. 40% for me. Couldn’t do that.

-- "Bordnerizing" perfectly good lumber for over a decade.

View kepy's profile

kepy

151 posts in 870 days


#5 posted 790 days ago

I have never paid more than 25%. Also, be careful of the shop. One I was in disappeared along with my pieces.

-- Kepy

View Mainiac Matt 's profile

Mainiac Matt

3830 posts in 925 days


#6 posted 790 days ago

Just surfed your projects again Joey…. you’re really cranking out the boxes and they look terrific.

I can’t comment on what’s a “fair” commision, as my wife’s uncle “taught” me long ago that “fair” is where you take your little pet pig to get a blue ribbon :^) (little dysfunctional family humor there)...

I will suggest that the shops have fixed overhead costs and typically no other way to cover them. And they are actually bringing something very valuable to the party…. a paying customer!

Where I work now, we have several brokers selling products that we manufacture and often they make more on them than we do…. and we have all the material cost, labor and more importantly THE RISK associated with employing people in a factory envirionment. None the less…. they are making the sales.

I think what’s more important, is the question…”are you making what you think you need/want to make?”

If the answers is yes…. I’d suggest you not worry about what they’re making.

-- Pine is fine, but Oak's no joke!

View Jamie Speirs's profile

Jamie Speirs

4085 posts in 1453 days


#7 posted 790 days ago

That is fair

I pay 35%

But make sure you get prominent display as

shipowners will sell the goods first that they

have laid out there cash for

No good your money sitting in the back on a bottom shelf.

Jamie

-- Who is the happiest of men? He who values the merits of others, and in their pleasure takes joy, even as though 'twere his own. --Johann Wolfgang von Goethe

View Greg The Cajun Box Sculptor's profile

Greg The Cajun Box Sculptor

4930 posts in 1905 days


#8 posted 790 days ago

33% seems fair and reasonable. Some wholesalers will want to purchase work at a 50% discount and some galleries want 40% consignment commission. Choose the galleries carefully and get a written contract of their policies. If your state has a local crafts guild and a retail store it can be another option.
there are some co-op galleries also that sell artists work for around 25% commission and you have to volunteer to work in the gallery a few days each month. You have to find the best option for your needs.

-- Every step of each project is considered my masterpiece because I want the finished product to reflect the quality of my work.

View Nate Meadows's profile

Nate Meadows

1067 posts in 803 days


#9 posted 790 days ago

Joey,

Remember that they have to pay rent, utilities and their employees. That money helps them. Sure they are not actively selling your product but it is taking up space so you are renting space and when the clerk rings it up, you are paying the clerk. You are also paying the employee to keep it clean and presentable. Your paying to keep the store nice and comfortable, the lights on, etc. It seems high but anything around 35% is fair, in my modest and humble opinion. Now if they try and go above that, they are eating into your money!

Very Respectfully,

Nate

-- "With a little bit of faith, and some imagination, you can build anything!" Nate

View MyChipCarving's profile

MyChipCarving

463 posts in 1721 days


#10 posted 790 days ago

I think Nate has hit it right on the mark. 33% is fair as it helps to put yourself in the store owners shoes.

-- Marty, https://www.MyChipCarving.com, 866-444-6996

View crank49's profile

crank49

3336 posts in 1567 days


#11 posted 790 days ago

As a retailer I’ve always expected key (100%) markups to be standard.
That’s the posted price, before discounts or sales.

Applied to the terminology being used here that would be a 50/50 split.
I have always, on any product I made for someone else to sell, expected I have to be able to make it and sell it for 1/2 of what it will be retailed for.

As far as 35% being excessive, I don’t think so.
In my retail store, If I can’t make a 27% margin I don’t even break even.
The cost of doing business has increased over 12% in the last 3 years due to paperwork and regulations.
Just had gubmint snoops in the store twice in the last month.
Got cited for not having a “No Smoking” sign on the back door.
My back door is only an exit. Can’t be entered from outside.

-- Michael :-{| “If you tell a big enough lie and tell it frequently enough, it will be believed.” ― A H

View Puzzleman's profile

Puzzleman

327 posts in 1541 days


#12 posted 790 days ago

I second crank49. I sell to over 500 retail stores, website and catalogs and they all at least double the price that I sell to them at. As long as they can sell it at that price, i don’t care as I make the price that I need.

Another way to look at is that if you didn’t have your product in their store, how much time and expense would it take for you to sell that same item? Does it take time away from the shop? Would you rather be making product or selling it?

They will reach people that you don’t know about as they have a clientele that will buy from them. I would also continue your direct selling to customers as well. This way you can make full price from your customers and the extra sales from the stores will be extra money for you.

-- Jim Beachler, Chief Puzzler, http://www.hollowwoodworks.com

View learnin2do's profile

learnin2do

866 posts in 1448 days


#13 posted 790 days ago

If they can sell your items at a high enough price that your percentage is satisfactory, then all is okay!

I get 40/60. One store doesn’t seem to be able to fetch enough to get us both what we need. The other is just too high end -i don’t think people want to pay that much for my things. I enjoy seeing the check i get in the mail. I just need to figure out what sells there that i can make fast enough to actually fetch me a decent hourly for my work.

-- christine

View Earlextech's profile

Earlextech

901 posts in 1287 days


#14 posted 790 days ago

It’s really not your concern how much they make “off me”. As long as they sell your wares and you are getting the money you need. But to that end I would hold them to a reasonable schedule. Maybe, after three months with nothing sold, the commission changes or you change items. You can’t let them run your business any more than they should let you run theirs.
There is no fair.

-- Sam Hamory - The project is never finished until its "finished"!

View JoeyG's profile

JoeyG

1233 posts in 1222 days


#15 posted 790 days ago

Thanks everyone. You guys have opened my eyes to look at it from a different point of view. I think I will give them the price I need and if it sells with their mark up that is great. If not then I will try something different. I have had a few pieces in a local shop with this set up and it worked fined for me, and they made theirs as well. Sometimes it just takes someone else saying what we already know. What does it matter what they make as long as I am able to make what I need to.

-- JoeyG ~~~ http://www.facebook.com/JHGWoodWorks

View JoeyG's profile

JoeyG

1233 posts in 1222 days


#16 posted 790 days ago

I should have chosen my wording more carefully. Instead of saying fair, what I meant to say was reasonable.

-- JoeyG ~~~ http://www.facebook.com/JHGWoodWorks

View mikema's profile

mikema

175 posts in 1182 days


#17 posted 790 days ago

I think it seems reasonable, when you think about what a retailer has to pay to put that item on their shelf:

Pay for employees
Electricity
Advertising
Government fees
Building maintenance/rent
And yes, a little bit of profit

Plus if an item doesn’t sell quickly, it is taking the shelf space away from another item that potentially could sell quickly.

-- Mike ---- Visit my woodworking blog: http://sawdustnewbie.com

View Jim Jakosh's profile

Jim Jakosh

11055 posts in 1702 days


#18 posted 790 days ago

It seems high to me, but if they put 33% on top of your price and you sell it, you don’t lose- you get your price. If you are selling products at a price you think is fair for the item and they take 33% off that, I’d reconsider if I want to market them that way. I don’t like to work for cheap if I can help it.
My 2 cents worth…...........Jim

-- Jim Jakosh.....Practical Wood Products...........Learn something new every day!! Variety is the Spice of Life!!

View waho6o9's profile

waho6o9

4744 posts in 1173 days


#19 posted 790 days ago

33% is a gift, be grateful for it. They make a little, you make a little, and the customer gets a custom JoeyG product. That’s harmony.

Unless of course you want to open your own store.

The Padauka dot box should sell quickly, it’s beautiful.

View canadianchips's profile

canadianchips

1831 posts in 1593 days


#20 posted 790 days ago

Know what YOUR costs are.
YOU supplied the material.
Your overhead (electrical, shop supplies,etc)
It was YOUR tools that built the item.
It is your labor doing the work.
You likely delivered the product to their door.
If they are willing to buy your item and then mark it up, it doesn’t matter how much they make.
BUT if they just want a commission…..33% is to much.

-- "My mission in life - make everyone smile !"

View Dan Lyke's profile

Dan Lyke

1468 posts in 2721 days


#21 posted 790 days ago

Yep, I’ve always figured that every time a product changes hands on the way to the customer, the price doubles. Standard markups in small retail have to run in the 40-60% of the sale price if the store is going to stay in business. In this case you’re carrying the risk of not selling and the cost of carrying the inventory, so you’re getting an extra 17% of the final sale price.

-- Dan Lyke, Petaluma California, http://www.flutterby.net/User:DanLyke

View degoose's profile

degoose

6968 posts in 1951 days


#22 posted 790 days ago

Are they adding the 35% to YOUR retail? Or are you wholesaling then adding the 35%?
Rule of thumb is… wholesale X 2 equals retail…
So to be fair… you sell at 200 retail… you wholesale at 100 and they re sell at retail of 200…so that is 100% mark up…
If as I read it… your are selling to them at full retail of 200 and then they are adding 35%.. that is 270…very good deal if they can sell at that price..
JMHO :)

-- Drink twice... and don't bother to cut... @ lazylarrywoodworks.com.au For lovers of all things timber...

View Philzoel's profile

Philzoel

270 posts in 940 days


#23 posted 789 days ago

On consignment % is a negotiated. I have got 75/25 to 50/50%. 50% is standard for gift shop items. Set what you want and let them mark it up. That is there business.

The deal of 25/75 was very good I thought. I set the price at $80 and would get $60. But they marked it up so I would get $80 and charged $106. I did not think they would sell there at $106, so I reduced my take.

I made 15 or 20 end grain cutting boards. Put 7 on consignment in 2 places and sold 3 at xmass and none since. Made $120 or so. I am glad I do not need the money. I did it to see if they would sell. Gave the rest away as presents. They were very much appreciated. Most people won’t spend $100 on a pretty board or box unless they are gifting it.

-- Phil Zoeller louisville, KY

View woodworker59's profile

woodworker59

560 posts in 798 days


#24 posted 789 days ago

I just stopped at a local shop up here in Rhode Island not far from me in Conn. they wanted a 50/50 split which I didn’t think was fair.. so 33% would have been pretty good sounding to me. I also had some stuff diisappear with the shop it was in.. only a couple pieces, but they were bigger than boxes and I figure I lost about 3 bills in the process. Can’t find her anywhere.. Live and learn.. so be careful, get it in writing and keep an eye on the shop.. good luck..

-- Papa@papaswoodworking.com

View wooded's profile

wooded

291 posts in 868 days


#25 posted 789 days ago

Although it is true that all they are doing is putting an item on the shelf for you which seems like very little, the fact is, we don’t have that shelf ourselves. Therefore, we could rationalize that they are providing a service which is to provide the display. Pay em. I have been a painter for many years and 40% is the the norm in most galleries that I ever delt with. 90% of the paintings I sold were through stores and galleries. I think one of the big tricks here is to (Through experience) find the max you can sell your stuff for…..................;-J

-- Joe in Pueblo West, Colo. jdelong264@msn.com

View stefang's profile

stefang

12541 posts in 1931 days


#26 posted 789 days ago

That sounds like a pretty good deal to me. They need about 30% just to cover their overhead costs. In fact I think it is exceptionally good.

-- Mike, an American living in Norway.

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