Wednesday, February 27, 2008

Selling Wholesale - Part II

We continue the article on Selling Wholesale - Look in our archives for Part I.

When you sell wholesale you are going to sell in quantity. You determine that quantity. It may be determined either in number of pieces or a minimum dollar amount. For example - wholesale order is a minimum of 12 pieces. This means the retailer must by 12 pieces from you at the same time. If your work is uniquely one of a kind for each piece then these 12 might be completely different. If you make earrings and bracelets you may require that the order be 12 pairs of earrings or 12 bracelets, but not mixed. If you wish to offer them mixed you might do that as well. If you can duplicate items and make several the same then you could offer the order as 12 of one design. This is all up to you as the wholesaler. You set the terms. The other example is by dollar amount - wholesale order is $100.00. The retailer may buy anything that they want from you at wholesale as long as they purchase a minimum of $100 in merchandise.

It is this bulk buying that can make it easier for the craft artist to lower the price needed for any item. Often you can make two items in the same time that you can make one. You have the same tool and work area set up time, the same equipment to set up, etc. but you now can use that one set up for two items - you have just cut your labor time by a significant amount. Sometimes you can make three or four or even six items in almost the same time as you could make one or two. Now you have decreased your labor time even more. Supplies in bulk often cost much less than supplies purchased a few at a time. You have just reduced your materials costs to fill a bulk order. See where this is going. Of course, with some things you are not going to save very much time or expense money, but whatever you can trim on your end will help you offer your work at a wholesale price that is attractive to a retailer. Also keep in mind that the time that you put into selling your work is time that may not be compensated for. By selling in quantity you are putting much less time and effort into selling a dozen items at one time than selling each of the 12 one at a time. Here it is worth your while to make that wholesale sale - even if your prices are a little lower than you would like. (Don't lose money, however. No sale is worth losing money over.)

Now that you have established good wholesale prices you are ready to make wholesale offers. I am not going to go into finding retailers to sell to here. Rather, I am going to concentrate on retailers who find you and ask if you will sell your work to them wholesale. Before we go on, understand the difference between wholesale and consignment. A wholesale sale is an outright sale - you receive the money for the goods up front, deliver the goods, and the transaction is over. A consignment arrangement is not a sale - it is the opportunity for a sale. When you sell "on consignment" the retailer takes your goods and you get no money until each item sells. You will then get a percentage of the sales price - which is generally 40 to 50%. You need to offer your work to the consignment shop at full retail and then you must be satisfied with the 60% or 50% of that price as your sale. Consignment is a whole other complex area and we will go into it in detail in a future article.

So, a retailer contacts you and says that he/she would like to buy from you wholesale. What do you do? First, you want to make sure that this wholesale offer is from a legitimate retailer with a sales venue - either a brick and mortar store, an established catalog, or an active internet sales site. You want to verify that this is not someone who is just looking to buy your work at a discount. If this is a store that is local to you visit it. If this is a catalog retailer, get a copy of the catalog. If this is an internet site, check it out. When you speak or email with this shop get as many details up front as you can. Always be polite. Never be demanding. Try to be as diplomatic as possible. Flatter them and be discrete at finding out what you need to know. If this is a brick and mortar shop and you can see it you do not need to ask anything - your proof of legitimacy is in the concrete - as long as it is a store that actually sells the things that you are wholesaling. If you sell jewelry it is unlikely that a plumbing shop is going to be selling jewelry retail. So just be cautious and you won't be scammed.

When you are satisfied that you are in a legitimate situation, present your wholesale pricing and minimums to the retailer. If this is a local shop you might answer the initial inquiry by making an appointment and going in to meet with the wholesale buyer. If not, then you are doing this by email, mail, or over the telephone.

If you are dealing with a retailer in your state and you are in a sales tax state, you are going to also present to the retailer that you require a signed copy of their business's sales tax form. This will cover your wholesale sale obligation with your state's sales tax requirements. If the store buyer has a problem with this there is something seriously wrong with this transaction. This is standard retail buying procedure. It is expected and any buyer who is unaware of this or refuses to provide this is doing something wrong. This is a warning signal to walk away!

When you present your prices also present your shipping and "handling" prices. This should not surprise the retailer either. They are seldom offered free shipping and expect to pay shipping costs as a day to day cost of business. Shipping in bulk is cheaper than shipping one item at a time. Know what it will cost to ship your items before hand including the costs of your packaging. You may be able to "sweeten" the deal by offering free shipping if you need something to close the sale. Keep in mind that what you establish on the first order may effect future orders so if you cannot afford to offer free shipping do not - or establish up front that future orders will require shipping charges.

Your retailer may ask you about reorders. Some wholesalers offer no minimums on reorders. Some offer no minimum on reorder but raise the wholesale price if less than X is ordered. This, again, is up to you the seller to determine what you will offer. For example - on one item that I wholesale I offer free shipping on quantities of six but on reorders if less than six are ordered the price is slightly higher and I add shipping charges. It is worth the retailers while to reorder six or multiples of six at one time.

When should you get paid? If the retailer is a major business - a large department store or a known business you should be safe accepting payment by check after the shipment is received. With a big business you know that they will not run away and they really cannot hide from you or your attorney (if it ever came down to that). To protect yourself always have something in writing - a sales agreement that they sign and return to you (with that sales tax form) or an email that clearly states the agreement of the sale and the name of the person who is making the arrangements for the store. Get this no matter how big the business is! Your agreement in writing is what is known as a "Letter of Credit". This is something else that real businesses are fully aware of and have no problem with.

If you are dealing with a small business - even a brick and mortar store - especially one that is out of your local area, get paid up front before your ship. Tell the business that it is your policy to be paid on all first orders (or all orders) before delivery. If they have a problem with this, find out why. Do they not trust you? Should you then not trust them? Do they not have the money right now? You are not in the business of making loans. Be sure that you are paid - and when you get the check, deposit and make sure that it clears before you send your shipment to them. You may also want to place into your written agreement that bounced checks will require a $25 fee. Your bank is going to charge you a fee if you deposit a check and it bounces. Cover yourself in advance. Stores have no hesitation to have this policy when they take your check.

What happens if you are dealing with a local brick and mortar store and they want to hand you a check when you hand deliver the items. For the most part you are going to just take the check and hand over the merchandise and take a chance. Here is another example of knowing absolutely where they are and that you and your lawyer can find them if need be. Let's hope that shops have some integrity. Most do!

So you have made your first wholesale sale! You now know what to do and the best thing is that usually you will hear from that shop again wanting more!

Sunday, February 24, 2008

Featured Artist

We have an illustrator to introduce you to - and she will be appearing on television in 2008 on HGTV! Let me introduce you to





Here is our interview with the artist -

Briefly describe what you make?

I create colorful children's illustrations, unique plush characters, and humorous bee ornaments.

What mediums do you enjoy working in most?

All of my paintings are in gouache. For me, it's an easy medium to work with, and I love the intensity of the colors. I also enjoy working with different fabrics, polymer clay, and acrylics.

How long have you been creating craft?

I've been crafting in some form or another my entire life! My mother is extremely crafty. She's dabbled in nearly everything from quilting to book-making, so she was able to keep me and my sister busy with projects when we were growing up. I also started writing and illustrating little stories on scrap paper when I was 6 or 7.

How did you get started?

I have a BFA in illustration from Rhode Island School of Design. In college, I took a couple sewing and apparel-related wintersession courses. That was probably what led me into experimenting more with more 3-D work in my illustration classes. After graduation, I started making quirky little objects and stuffed animals as gifts for friends. It just sort of expanded until I became involved in RISD Alumni Art Sales, and eventually began selling online.

Where does the name of your shop come from?

It's pretty uncomplicated, actually! "Honeydew" is the name of the color I painted my studio.

What would you most want people to know about your work?

With the obvious exception of prints, every single thing I create is 100% hand-made and hand-painted. Even when I recreate a popular item (like a particular stuffed animal, for example), no two items are ever exactly alike.

What words of advice do you have for other artists?

Loving what you do has to be your driving force. The market is absolutely saturated with talented artists, and it can be really hard to get noticed. Don't give up and promote, promote, promote! The more you get yourself out there, the easier it will be to people to find you. Networking with fellow artists and craftspeople is really helpful too. It gives you the support you need and a great community for feedback.

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That is great and so is the work! Make sure to keep looking at HGTV's "That's Clever" to see this artist. And don't forget to visit this shop at Etsy!

While you are at Etsy you must see the new photos that I am offering in my shop.


Wednesday, February 20, 2008

Selling Wholesale - Part I

The question often comes up from new craft artists. What do I do if I am asked to sell wholesale? This is the ultimate in craft sales. This is what every craft artist should want! At wholesale you will sell in quantity and you will have the potential for continued wholesale orders - if your item becomes popular at the retailer's shop.

I have had success at selling wholesale to shops and to catalogs. It is a wonderful feeling to know that your work is being sold in stores. To sell wholesale there are a few things that the craft artist must know.

In anticipation of any wholesale sales the craft artist needs to determine the wholesale pricing of their work. When a retailer sells an item the retailer generally doubles the price paid at wholesale for that item and that becomes the retail price. Some retailers triple their items. Amusement parks are known for tripling wholesale prices on souvenirs and other things that are sold in the park. When a retailer is looking to purchase items at wholesale the retailer is looking to see that your prices are able to be doubled (in the industry this is called "Keystoning") and that the wholesale price that you are offering is below the price that the item is currently selling for to the general public. Pricing is a difficult issue for many artists and craftspeople. They tend to devalue their work and place lower than market prices on their work. There is a whole psychology of this that we will not go into here, but it is important to understand the basics of pricing.

To price an item you need to take the costs of all materials, supplies, and expenses that make up an item and then add that to an hourly rate that you as the artist must determine that your labor and talent are worth. Start with the minimum wage and work up from there. You should certainly be paid the minimum wage. Of course, you should be paid more than the minimum wage. It is up to you to decide what you are worth per hour. Multiply the number or fraction of hours that it took to create your item. Add that item to your costs. Your wholesale price should be the result.

You are not finished yet. To sell that item on your own you may have other expenses. If you are on an internet site that charges fees you now need to add those fees. If you sell at a craft show the table space will cost you money. You need to proportion that into your prices. If you take credit cards or use Paypal you must pay fees. Those fees need to be added into the price. Ideally when you are done you are at or near doubling that wholesale price that you came up with a few moments ago. (See why retailers double your wholesale price - they have these expenses too, only greater if they have a brick and mortar store.) Many craftspeople will feel that their item will not sell at double that initial price and feel uncomfortable about offering the doubled price when they try to sell the item on the internet or at a craft show. Eager to make sales they often offer their wholesale price to the public. This is a problem when it comes to selling wholesale. As I said earlier, retail shops do not want to compete with you and want to see that the price that they are paying wholesale is significantly less than your usual prices.


TO BE CONTINUED!

Sunday, February 17, 2008

Featured Artist

Here is an artist who creates clothing for both children and adults. Come and meet -



Here is our interview with the artist of LaMadeleine, Madeline -

Briefly describe what you make?

Primarily I make clothing for women and children, most of which is vintage inspired or made using vintage materials.

What mediums do you enjoy working in most?

Cotton is, by far my favorite medium. It is a fabric that you can trust. It irons, washes, and wears well. It's crisp and reminiscent of summertime.

How long have you been creating craft?

I have been creating, something at least, as long as I can remember. Even as a child I was always trying my hand at different crafts, sometimes successfully, other times, not. It wasn't until about 3 years ago (when I was a junior in high school) that I really started sewing clothing.

How did you get started?

I got started, a few years ago, when mother and I first started selling on e-bay. We sold a lot of different things but specialized in vintage sewing patterns and fabric. There were always a lot of vintage sewing supplies around the house, just begging to be used. I started out painting pictures of the illustrations on the covers of the patterns, and eventually decided to try making some of the designs. It turned out to be a lot of fun, and I've been doing it ever since.

Where does the name of your shop come from?

The name of my shop is derived from my real name "Madeline". I just played around with different spellings and ideas and decided the French article "La" and the extra "e" in the middle made it sound more distinguished.

What would you most want people to know about your work?

I make a lot of items on request, for people who have a certain idea in mind, for a dress they would like, and ask me to make it for them. The thing I love most about making clothing on etsy is doing custom orders. I love making dresses for people, that are one of a kind and made especially for them. People really value having something that is truly unique and their's alone, and I get a lot of joy from making that happen.

What words of advice do you have for other artists?

The best advice I can give is to know and explore your options. It's a big world out there and it just keeps expanding, in terms of knowledge and possibilities. There are countless tools and venues to be used and explored. Talk to other crafters, see other people's work, share ideas, search for inspiration, look around in internet-land to see what other people are doing with their skills. Most importantly though, love what you do.

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Great things to be found at LaMadeleine

While you are at Etsy please come take a look at my latest creation. This is something different that I have been getting into and would love your opinions. Take a look at Flora Pura.

Sunday, February 10, 2008

Featured Artist

Our featured artist does not paint, draw, or make jewelry. Our featured artist creates creams and lotions. And now for something completely different -




Here is our interview with the artist, Crystal -

Describe what you make?

I make cold process soaps, whipped body butters, body lotions, sugar scrubs and body sprays.

What mediums do you enjoy working in most?

I enjoy working the most with different butters, such as Shea, Mango and Cocoa butter. I love how many products I am able to create out of these butters and the different texture and feel each one offers to my products.

How long have you been creating craft?

I've been making soap and body butters for about 3 years.

How did you get started?

I first began creating soap after my children were born about 3 years ago, I had decided to stop working and wanted a hobby that interested me. I have always been a bath and body junkie and when I started looking throught the ingredients of the products I had in my bathroom I was shocked at the ingredient list, I coudn't read most of the ingredients and had no idea what they were. So I began researching different products, basic recipes and the benefits of the more natural ingredients used in body products. After many experiments and my family and friends being my test monkeys, they finally convinced me to start offering my products for sale at local crafts shows and eventually online.

Where does the name of your shop come from?

Domaly came from my two children. My son Dominic and my daughter Alyssa.

What would you most want people to know about your work?

The products I offer in my shop are products that I love and use on myself. I want people to enjoy using my products as much as I enjoy making them.

What words of advice do you have for other artists?

Don't give up! Sometimes things don't always work they way they are suppose to, but the more you try and the more effort you put into your craft the better the outcome!

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Interesting - you can purchase Domaly's creations at her shop.

I also invite you to come to my main website and come see the different media that we work in!

Sunday, February 3, 2008

Featured Artist

This is an interview with a felt artist. I find this work fascinating and it is something that I would personally love to try. Here is our interview with the artist, Tara of




Describe what you make?

I'm a fiber artist who makes all things felt and functional. Felt is made from taking wool fibers and rubbing them together to create a durable fabric material.

What mediums do you enjoy working in most?

Wool of course! But I also love paper. There are so many cool types of paper out there now a days. I love to visit my local scrap booking store and just unload money on paper for no reason. I hope to one day open another etsy paper shop.

How long have you been creating craft?

I have been creating since conception it seems. I have experimented with all sorts of mediums from, watercolor, pencil drawings, clay, jewlery, copper sculptures. The list goes on and on.

How did you get started?

Felting was a accident. I decided that a purse I crocheted from wool needed washed. And so out came my purse from the wash 10 times smaller and very thick. I wasn't sure what was going on till I told my mom and she said that I felted my purse. I googled the term and the rest is history. I was hooked ever since.

Where does the name of your shop come from?

Project Felt actually wasn't my original etsy shop name. When I first signed up for etsy my name was funky by tara. I sorta grew out of that name and decided I wanted something a little more professional. I redesiged my whole image, products, pictures, everything. People always ask me what I'm doing and I would always say " I working on a project" and so that's where Project Felt came from.


What would you most want people to know about your work?

The time it takes to make. I'm not the fastest crocheter in the world and I'm not the slowest either. But what people don't realize is when you felt something, it shrinks ( a lot) so this means that you have to crochet a peice about three times the final size before you felt it. It takes time. Not to mention the three to four washing cycles it takes to actually get a good felted piece

What words of advice do you have for other artists?

Don't give up. There is always someone out there who will fall in love with your craft. Knowone said that thinking outside the box or even being different was easy. Starting a business isn't easy. Marketing isn't easy and if you think so then you better ask to be pinched because you are sadly mistaken. I work my butt off. I have a dream and goals in mind. I encourage all crafters who want to make a business doing what they love to never give up. And most of all don't give up on yourself.

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Tara has some great things in her shop
You must come and see her work!

Photography

I have been a photographer for many years. I have just started offering my photos for sale - some as greetng cards on Etsy and some as prints and framed prints at my new store front at lulu.com.

I had an opportunity last week to do a photo shoot at an event at a garden nursery that not only featured a fabulous array of tropical and domestic house flowers, but also had birds of prey from a local wildlife preserve. I got some wonderful pictures that I have just started to process. I must say that the results so far are fabulous. I am sure that you will agree.

Come see my prints at
www.lulu.com/qbranchltd

and come see my photo greeting cards at
www.qbranchltd.etsy.com

Be sure not to miss this one!
But before you look - that one is for adults only!