Expansion Ideas Needed! :)

piglet25

Hi all I have a small, very small, business which has regular customers, repeat orders and is brand loyal to those who have purchased, ( so hard trying to describe it without giving it away :O ). My items are a very good price and unique to me as I make them. What I am stuck on is how to break into a larger market? I am thinking places which are mainly used by females, such as salons, spas etc and also independent stores. My problem is I do not know how to approach them initially, I did have two sale or return shop deals but found that my stock was damaged and removed it, so wish to avoid this in future. What sort of mark up would tempt a retailer?
Any advice much appreciated xx

shegirl

Hard to say without knowing what you make!

You should already have a retail and a 'wholesale' price -retail being the price you sell at to customers (and shops will sell at) and the wholesale being the price you sell to shops. As a general rule of thumb, some things are sold to shops at 50% of retail.

All this should have been considered and accounted for when doing deciding on your pricing, so you ensure both give you profit

Mistral001

By "very good price" do you mean lower than the competition?

shegirl

Mistral001 wrote: »

By "very good price" do you mean lower than the competition?

That's something I wondered when I woke this morning (quite random, I know!)

'very good price' on something unique and handmade generally isn't good..

paddyrg

It may be possible that the nature of the product does not scale well, for instance cupcakes and homemade Christmas cards. Somewhat tricky to tell without knowing what the product is!

PasturesNew

shegirl wrote: »

Hard to say without knowing what you make!

You should already have a retail and a 'wholesale' price -retail being the price you sell at to customers (and shops will sell at) and the wholesale being the price you sell to shops. As a general rule of thumb, some things are sold to shops at 50% of retail.

All this should have been considered and accounted for when doing deciding on your pricing, so you ensure both give you profit

OP, what has been said here is the key. The starting point is to calculate these future markets into your pricing. As has been said, it's typical to offer a wholesale price and the shop gets that price.

You also shouldn't put your stuff into shops without them paying for it. If they aren't prepared to pay for stock, then find somebody who will.

You and they need to have a good mark-up, they mustn't feel you're undercutting them on the retail market. They also need to value your goods, which you don't get on a sale or return basis.

You approach them through good market research, done on the ground - see who they are selling to and their price point.... then get yourself geared up with samples/a website/PoS material/order forms etc and go door-knocking for an appointment.

Mistral001

PasturesNew wrote: »

You also shouldn't put your stuff into shops without them paying for it. If they aren't prepared to pay for stock, then find somebody who will

Surely "sale or return" is a recognised method of getting your goods into shops especially if they are unique and do not have proven record of sales. Many crafty and tourist shops get much of their stock that way I believe.

shegirl

Mistral001 wrote: »

Surely "sale or return" is a recognised method of getting your goods into shops especially if they are unique and do not have proven record of sales. Many crafty and tourist shops get much of their stock that way I believe.

It's common with galleries and some shops. It always carries risks though and a good contract needs to be prepared by you. It's always better to sell to the shops than to go by a sale or return basis,although with galleries it's pretty much a given that it'll be sale or return.

A big yes to Pastures comment on undercutting too,both ways. You and shops should be selling at the same price.

Don't be surprised for a request of wholesale price at 50% of your retail price. If you have priced correctly you should still profit on this.

piglet25

Some very good points and ideas made, thank you I will be looking to slightly increase the retail cost of the product so I can offer a better profit margin at the wholesale level, and am working on an information pack for wholesale too

shegirl

See how well your increased price goes down with customers before trying the shops then. Guessing you haven't priced correctly in the first place so see how it's taken.

piglet25 wrote: »

Some very good points and ideas made, thank you I will be looking to slightly increase the retail cost of the product so I can offer a better profit margin at the wholesale level, and am working on an information pack for wholesale too

Mistral001

No matter how highly the product is regarded by present customers, many will be put off if there is a price increase no matter how small that increase is. It is human nature I am afraid.