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Wholesale and consignment pricing?

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Forum topic by drpdrp posted 131 days ago 583 views 0 times favorited 10 replies Add to Favorites Watch
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drpdrp

150 posts in 642 days


131 days ago

It looks like I am going to pick up some specialty retailers to sell my stuff. I am looking for advice on how to adjust my prices?

Because I am trying to maximize my prices when I sell I think I charge about what the market will bear. If this is true, the retails will charge about what I charge right? Hence, I need to offer them a much lower wholesale rate… So, if retail will be 100 (for easy maths) what should I charge the store?

If they would rather do consignment I guess I get more than the wholesale rate, but still less than retail?

Thanks guys,
T


10 replies so far

View Monte Pittman's profile

Monte Pittman

13222 posts in 935 days


#1 posted 131 days ago

In most cases for me, they get 30% of your normal price. If you charge $100, they get $30.

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

View FellingStudio's profile

FellingStudio

35 posts in 279 days


#2 posted 131 days ago

My understanding of the retail/consignment game is that the retailer will want 30-50% of the sale price of the item. If they can move the product, this is generally a good deal. (Of course, they have to be able to move the product!)

So, in your example, you will be charging them $50-70 depending on your agreement.

Wholesale is another beast altogether. It depends on your ability to make large quantities of your product, and your buyer will be buying outright large lots at much lower prices that will be negotiated. You will probably get less per item than with the retail/consignment shop, but the upside is that you have a guaranteed sale of a sizable run of a piece.

Also worth noting for you is that the specialty retailer/consignment shop will not want you competing with them on price. So, they may have verbiage in their agreement that prohibits you from selling the same piece for a lower price than they have in their shop.

-- Jesse Felling - http://www.fellingstudio.com

View DrDirt's profile

DrDirt

2355 posts in 2339 days


#3 posted 131 days ago

~50% is what seems most common. Then they can mark it “20% Off” and still make money at it.

the term is Keystone pricing.

If the Retail price will be a hundred – - they are buying at 50 from you.

Definitely note fellings warning – - regarding “non-compete” clauses.
just make sure you can live with it. They are wanting to make sure that the item they have for 100 dollars wont be in your craft fair tent a block away for 89.99 on the weekend.

-- "If we did all the things we are capable of doing, we would literally astonish ourselves." Edison

View drpdrp's profile

drpdrp

150 posts in 642 days


#4 posted 131 days ago

Oh I guess I was using the term wholesale wrong.

These will pretty much all be one of a kind art pieces… And I am hoping to do this so I don’t need to hawk stuff on my own.

Thank you guys.

View Woodendeavor's profile

Woodendeavor

210 posts in 1203 days


#5 posted 131 days ago

I have worked with a few different places, are they going to buy the work from you and then sell or is the work going to be sold on consignment? Very different scenarios

View CharlesNeil's profile

CharlesNeil

1112 posts in 2467 days


#6 posted 131 days ago

Having been in this business for over 40 years, I can tell you consignment rarely works. They take your pieces, use them for displays, and have litte respect for them. I have also had them increase the sale price, to the point it priced it out of the market, and it didn’t sell. Ihave gotten them back all scratched up and damaged. Be very careful and make sure you have EVERYTHING in writing and visit your goods regulary .. and always drive your truck when you do , you may well need it .

View gfadvm's profile

gfadvm

10538 posts in 1287 days


#7 posted 131 days ago

Unfortunately, I have had the same experience as Charles Neil. Plus smaller items got stolen and the consignment shop’s response was: “stuff happens and we aren’t liable”.

-- " I'll try to be nicer, if you'll try to be smarter" gfadvm

View Puzzleman's profile

Puzzleman

327 posts in 1541 days


#8 posted 131 days ago

Whenever you asking about pricing, MY first question is what is your costs? By this I mean what is your cost of your studio/shop, tooling, materials and most important your labor hours at a fair rate. Huff did a real good blog about this. Check it out. Search the blog section for Huff.

This costing should be your floor price and move your pricing up from there. But you MUST know your costs and minimum price. Of course, this is only if you want to make a profit. If you are doing this for a hobby and fun, then price it at whatever. If you don’t know your costs and don’t care about them, then just shoot them a price.

Bottom line of this post is: You should never have to ask anyone how to price something. If you know your costs, you know your price.

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

View Jim Finn's profile

Jim Finn

1638 posts in 1518 days


#9 posted 129 days ago

Consignment selling rarely works for me. I have sold to retailers as a manufacturer. In my case, I negotiated a price and after receiving payment shipped the items to them. I have done this only twice with two different retailers and looking for more.

-- In God We Trust

View tomd's profile

tomd

1725 posts in 2367 days


#10 posted 129 days ago

For several years I have been selling through an art gallery and they take 40 per cent. The advantage is they do the selling and collecting of taxes but more important is they have the clients.

-- Tom D

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